Each year, it is estimated that domain name sales generate between $250-$500 million. With so much money in the industry, buying domains online has turned into a lucrative business for many. Although, the majority of domain sellers are trusted and revered, there have been some reported visible domain scams/fraud. With this in mind, We have collated 6 top safety tips to consider when buying domains online:
#1. Look at the Email Address
Most domain sellers will trying contacting buyers using email. But, nowadays in this day where spam and fraudulent emails are rife, it's difficult to determine which sellers are trustworthy. If you find a domain that you're interested in, check the seller's current email address. Is it a personal, random or business email address? The majority of legitimate sellers could have their own bespoke current email address with their associated website. However, if you aren't sure, you can always ask the owner to email you against their business email account or provide further information about their business and background.
#2. Seek information
Like any potential purchase, do your research beforehand. It is worthwhile reviewing the website, testimonials and any online reviews. A successful seller would be happy to share their testimonials and direct you towards any references. Thorough research allows you to make a decision about whether you want to do business with the seller.
#3. Read Terms & Conditions of Sale
Read and clarify all terms and conditions of sale. Domain sellers are obliged to offer full transparency within the terms of sale. Make sure that you understand and accept all terms in keeping with purchasing the domain(s).
#4. Negotiate and Agree a cost in Writing
All final negotiations, agreements and payment terms should be confirmed in writing. The written correspondence can be a legal contract that you simply enter with the domain seller. If there is any dispute, your correspondence will behave as evidence to the agreement in place. We would recommend that you review all correspondence just before accepting any terms to actually are entering a legal contract that you completely understand and except.
Extra Tip: Make sure that there are no hidden costs included.
#5. Use an Escrow Service
Escrow services are alternative party companies, which collect, hold and release funds online, based on transaction terms arranged by the Buyer and Seller. All trusted Escrow services are government regulated and licensed escrow companies, which adhere to Escrow law.
Through using Escrow services, both buyer and seller are protected from potential online fraud. In the case of domain sales, payment is collected and cleared from your buyer prior to the change in a domain name. Following the transfer of the domain name, the buyer has a number of days (usually 3 or maybe more) to accept the name before any monies are let go to the seller. We use Escrow.com - Learn more about buying domains online on the Buying Domains Online page.
#6. Accept your Purchase
If you are using an Escrow service (see tip 5), then once you've completed the change in the domain in your control, you will enter in the 'Review' period. This period generally is a minimum of 3 days, but may be longer based upon your arrangement with all the seller. During this period, there is a opportunity to review your new domain(s) and ensure that you are completely happy with the transaction. If you find that the domain or terms are don't match your agreement, it is possible to raise a dispute with all the Escrow company, who will suspend the release of the payment before matter is resolved.