Closing a domain sale and using escrow
Closing is where a domain deal is won or lost twice. Neither side wants to move first, and escrow exists to remove that problem rather than to add ceremony.
An agreed price is not a sale. Between agreement and completion sit a payment, a change of control at a registrar, and a period during which one party is exposed. Escrow, meaning a neutral party that holds the money until the name has moved, is the standard answer, and every serious buyer expects it.
Put the terms in writing first
Before any payment, both sides should have the same short written record. It needs the exact domain including the extension, the agreed amount and currency, who pays the escrow cost, the deadline for funding, the transfer method, and what else is included. That last point causes more disputes than any other: a sale of a domain does not automatically include the website, the content, email archives, social media handles, or any trademark rights in the term. If any of those are part of the deal, they belong in the record; if not, say so.
Where the name resembles an existing mark, both sides benefit from stating that no trademark rights are being transferred, since the buyer's own risk position depends on their use, not on the domain, as screening for trademarks sets out.
How escrow runs
- Both parties agree terms and one opens the transaction with the escrow provider.
- The buyer funds the escrow account. Nothing should move before funds are confirmed as received, not merely as sent.
- The escrow provider notifies the seller, who then starts the transfer.
- The buyer confirms receipt of the domain in the account named in the terms.
- An inspection window runs, after which the funds are released to the seller.
The cost is small relative to the risk and is commonly split, though the deal terms decide. A payment service that offers buyer chargebacks is not a substitute: reversing a payment after a domain has moved leaves the seller with neither. Tappaya offers an escrow service for payment and handover alongside its marketplace, and a selective mediation service exists for higher-value names on a success fee basis.
Transfer mechanics, by route
There are three ways a domain changes hands, and they differ in speed and reversibility.
| Route | How it works | Speed |
|---|---|---|
| Account push at the same registrar | Seller moves the name to the buyer's account at the registrar where it already sits | Fastest, often immediate |
| Inter-registrar transfer | Seller unlocks the name and supplies an authorisation code, buyer initiates at the gaining registrar | Days, subject to release and locks |
| Registry-specific change | Country code registries use their own procedure, such as a transfer token, a transfer code or a change of the registrar tag | Varies by registry |
The push route is preferred where both parties can hold accounts at the same registrar, because it avoids codes, locks and waiting. The mechanics per extension, including which registries use codes and which use other systems, are listed in the extension table.
Locks and timing
Generic top level domains are subject to ICANN transfer policy, which imposes lock periods after a new registration, after an inter-registrar transfer and after a change of registrant, during which a further transfer is refused. The lengths of those locks have been under revision, so the safe practice is to check the current position at the registrar before promising the buyer a completion date. A lock discovered mid-deal, after funds are in escrow, is the most common cause of a closing that drags.
Country code registries apply their own timing. Some issue a code valid only for a short window, some require the losing registrar to release the name within a set number of days, and some treat a change of holder as a separate procedure from a change of registrar. Country code differences are covered in more depth in the country code spotlight.
Checks before release
The seller should confirm that the amount held in escrow matches the agreed figure before touching the domain. The buyer should confirm three things before releasing funds: that the domain appears in an account they control, that the expiry date and extension are as agreed, and that the name is not locked in a way that blocks its use. Where nameservers were pointed at a sales page, they need changing, and DNS changes can take time to propagate, which is not itself a sign that anything is wrong.
After release, the seller should remove the name from every listing and sales page, and keep the escrow record and the written terms. A dispute raised months later is settled by those documents and by nothing else.