What to do? A default in a domain name holding transaction

Opinions

So I need your opinion on an ethical matter. I sold a domain name using the Escrow.com domain name holding transaction service for about $10k.

The buyer agreed to purchase my domain name with a down payment and 24 monthly payments in the summer of 2017.

He has made 20 payments, sometimes with a bit of a delay, including the down payment. So he has 5 more payments to make at $277 each.

He made the last payment in March 25. After that he missed 3 payments and he was about to miss another one.

2 weeks after he missed the 3rd payment in a row I started the 7-day cure period. A cure period means that Escrow.com officially notifies the buyer that is he does not make his account current then he will default the transaction and the domain will be transferred to me the seller.

3 days after the cure period started he sent an email saying that he is “actively working on securing full payment for the outstanding balance.”. He also said that he would send another email 3 days later.

Escrow.com sent me and the buyer 11 emails asking the buyer to make full payment before I got the name back.

So about 2 weeks later without any money sent or any email the domain was transferred to me and the Escrow.com domain name holding transaction was closed.

On the next day (25th of July) and the day the 4th of the remaining 5 payments was due he sent an email saying that his email was hacked and that he had just sent a payment for the remaining 5 payments.

What should I do? I know that he has defaulted in his payments and he can’t legally object to this.

Now Escrow.com has secured the last 5 payments ($1385) and is asking me what to do.

Should I transfer the domain to the buyer?

Has this happened to anyone else? I mean he was very close to completing the whole transaction…

I think I have made my decision but I would like to hear from as many people as possible.

Sold.Domains

About Konstantinos Zournas

Konstantinos studied Computer Engineering and Computer Science in London and lives in Athens, Greece. He loves domains and building websites. He is online since 1995, learned about html in 1996 and got into domains in 2002. He started the OnlineDomain.com blog in 2012.

37 comments

  1. If escrow.com has secured the remaining payments to reach the agreed upon price, I would honor the sale.

  2. I would just go ahead and transfer the domain and be done with it.

  3. I would be understanding and let him have the domain.

  4. Honoring the sale would be the right thing to do.

  5. Since Escrow.com have secured the funds and considering all the facts, I would honor the sale.
    Thanks!

  6. Honor it – you are doing the right thing. Being pissed that it took so long is a valid feeling

  7. Transfer the domain over to him.

  8. You Already know the choice your going to make.
    Your a stand up guy and correct thing to do is finish the transaction.

  9. Hi..

    There is no legal angle in this…as the buyer is well aware of the result.

    I think if you have no problem and already Escrow secured the remaining payment amount…you transferring the domain back to buyer will be a great favor for him and shows some values.

    A little overlooking will be a not so little help for the buyer.

    Thanks,
    Ravi.

  10. That sucks. What an unfortunate circumstance for the buyer. I guess i can see it happening though especially if he lost control of his email account. Although after a month or (2) of not making your payment to escrow.com you would have to think, oh shit i havent made a payment on my domain name to escrow recently. I know i am in breach of conttact and i can lose my domain name i am buying. I have to make a payment and make sure the domain im purchasing doesnt get taken away and make sure i didnt just waste 7 or 8k.

    Whatever the buyers actual story is, the buyer definitely fell on hard times one way or another and is now basically paid up.

    10k is a lot of money to most people. Im guessing this is an important domain name to the buyer for them to finance it.

    Hopefully this buyer develops it and changes the world a little for the better.

    Kon, you are someone many domainers look up to. It could end up as a very good, positive story that we dont see often in domaining.

    I agree with the other commenters here. I would honor the transaction.

    #Karma

  11. Echoing the overwhelming majority, I would honor the sale. There was best effort and good intent by the buyer, and probably some genuine hardship. I am pretty sure the “do unto others” test makes the decision easy.

  12. Me too, Honor the sale!.

    Good Weekend.

  13. Honor the sale, and send him a thank you card.

  14. I would honor the sale.

  15. You won’t want to be known as someone who took back a domain when it was pretty close to being paid for, so completing the transaction seems better. I had to confront a slow payer at Escrow just weeks ago too.

    • What I meant to say was, because the buyer DID send the balance, it looks better to complete the sale. If he hadn’t, that would be different.

  16. Yes, honor the sale.

  17. Transfer the domain. The remainder of the amount due has cleared, so it’s yours now.
    While the buyer has caused inconvenience to you, I am not sure he deserves the punishment. It would be a different situation had he stopped making payments early on in the process.

  18. Be the ‘better man’ (than you legally nerd to be) and complete the transaction

  19. I would complete the sale, good karma.

  20. I would honor the deal.

  21. I’d honor it.

    But be careful that everything is legit. Sometimes when unusual things happen, or someone puts us in a different mood, escalating our emotions, it’s an attempt at social engineering. On the side they may be spoofing escrow emails or the buyers account may have been hacked by someone else who read emails and found an angle to get something of value by having you transfer the domain to them… who knows? But I’d just be extra cautious and confirm everything with escrow.

    I actually had a similar thing with a .nyc I sold for $2500. Payments stopped after the first two, months went by, slow responses about payment coming. Turns out the person went through a horrible chain of events that I’ve verified. Some really bad stuff happened and they just completed the payments.

  22. Andrea Paladini

    Kostas,
    I would honor the sale.

  23. Common sense—just honor it and move on!!

    You will come out as the GOOD GUY…the honest Guy

  24. Honor the sale. You’ll feel better about yourself and he won’t seek unscrupulous revenge.

  25. The buyer breached the contract and you have given ample grace to catch up.
    You have every legal right to return the last, pending payments and keep the domain name.
    As much as I despise the current system of buying and doing donation names (esp cybersquatting), we have rules for a reason. We have contracts for a reason. To renegotiate the rules mid-transaction does nobody any good unless one party was coerced or taken advantage of. In other words, you do not right any wrongs by letting the other party bend/break the rules.
    If you think you can sell the domain name elsewhere, then do so. If that buyer wants to buy it again, then charge the full price.

  26. How incredible!
    Seeing all this comments has brought a tornado of fresh air, this is what many in this industry
    are and should grow to be every day more, sincerity & Honesty.

    Many people go through situations in life and we all have had our share in one area or another,
    he had paid the majority of the domain, doing payment for a long time.

    Happy to share in an Industry with generous people with kindness and consideration

  27. Someone who has been paying an installment each month 21 times does not need any payment reminder.
    It has become a routine and has no excuse to miss 3 monthly payments in a row.
    So for me arguing that his email was hacked is simply a lack of honesty.

    Personally, in the same situation, this depends on my mood and my relationship with the buyer:
    – I may accept the remainder money and give him the domain.
    – Or suggest a penalty to cover my time, hassles and stress the situation generated. Maybe a symbolic extra installment to at least educating the buyer that agreements need to be followed religiously.

    On a side note, delay on payments happen too often:
    This is why even for full money down purchase I suggest specifying a deadline and cure period in the agreement to avoid to be waiting for weeks without know if the buyer will proceed.
    And for sure, do not allow any payment delay from the beginning, otherwise the buyer will assume he can repeat.
    There is too often communication problems with buyers during escrow so I also suggest adding in the agreement the email, phone and cell of the buyer to have multiple ways to contact him if a problem occurs.

  28. It is great to see so many saying to honour the deal.

    So if I read that right, we has now paid the whole thing EARLY.

    I am pretty brutal on things, if there has been a cost to me (of having to chase payment) I value my time at $100 an hour.

    I would also look at any interest lost on the late receipt.

    If total of the above exceeded $100 I would g

    I do not believe the nonsense about the email being hacked.

    However, there is this thing called KARMA

    Also consider that he would be likely to tell everyone that would listen and post everywhere about his experience with you.

    I think you know what is right thing to do.

  29. I’ve had a few cases where someone has paid for the domain (single payment, not installments) and then they haven’t completed the transfer. And months of reminders…

    Frustrating. And I remind them in the emails that if I get hit by a bus they’re going to have a hard time getting what they paid thousands for… Eventually they use the auth code or accept the push.

    I even had a case where someone bought a domain, it was expiring a year later, I reminded them, it dropped, I registered it again, emailed them to say if they want it – let me know. They did and I transferred it back for free. I can eat the $20 renewal for the good karma I received and I made a great profit the first time I sold the domain – and that was an easy no haggle deal.

  30. I concur with the consensus here to deliver on your side of the contract given that the person on the other side delivered on their side, albeit rather sloppily at the end.

    I did a DomainSherpa show recently (might be out tomorrow, I’m not sure) about a domain name that I had a previous buyer default on payments totaling $10,000 at Escrow.com. Made first 3 payments but defaulted on the final balloon payment. Gave him an extra three weeks after the last payment due date. Absolutely no communication back from the buyer to me or Escrow.com. Escrow.com asked me to green-light the cure period, so I did. Still no response from the buyer. Got the domain name back and retained all previous payments. Sold it again a year later for $12,000, with a different buyer making a lump sum payment, no problems. Throughout all of the above Escrow.com handled the transactions professionally and speedily, no problems.

  31. Your first problem was selling a domain at $10k and giving him 2 years to pay for it. You should have expected this type of behavior. Especially when the down payment was an issue. I would reject the funds and start a new transaction, above the previously agreed and make him pay in full.

    When people see that they can jerk you around like this, it makes you look desperate and word travels that you’re a push-over. A domain at $10k is a one-payment purchase. $100k+ – that’s payment over time, maybe. All depends on who is buying it. $1million+ definitely offer payment over time, IF they need it. Anything else is a time-suck and you’re asking for problems from small players.

  32. I am glad you posted this article. I think it helps to show publicly what many in the industry have long known, it is made up of good people who try hard to do the right thing even when they do not have to. I would also do the same and deliver the domain.
    It is and has been my experience that the domain community is made up of many really good people who try and help each other and the people they do business with. I’ve witnessed countless things like this, or where someone had legitimately purchased an expired domain only to sell it back for their exact purchase price to someone who accidentally let it expire somehow, or how open people in the industry are to help one another succeed. All of these things if looked at objectively hurt the individual, in the short term at least, financially. Time and again though you see people in the industry sacrificially giving of themselves to help others. This is one big reason I am happy to be a part of this industry and it is refreshing to see this shown so clearly in the article today.

  33. I would say accept the remaining payment and honor the deal. Not only is it good karma but also good business.

  34. Yes, I’d honor the transaction/sale.

  35. What happened at the end? Was domain returned?

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