The Nuts and Bolts Of How To Buy And Sell Websites: Part 1 of 3

How to Buy and Sell WebsitesThe majority of the posts I publish on this blog are written with the assumption that the reader has “some” experience on how to buy and sell websites, or is at least familiar with the concept. I take it for granted that there are actually a lot of newbies to website flipping who are reading this blog and are being introduced to this online business model for the first time.

Sometimes it takes a flood of emails from folks asking specific questions on how to buy and sell websites to realize I may have been overlooking the basics and ignoring those new to this industry. For that, I apologize for being a knuckle head and will strive to be more balanced with the topics I’m writing about.

With that said, I am going to write a three-part series that covers the nuts and bolts of how to buy and sell websites. Specifically, I’m going to cover the actual process of the deal itself. Here are the basic steps of the process and what I’ll be covering in each part of this series:

Step 1: Buyer & Seller Agree To A Deal
(Part 1 of the series)

Step 2: Buyer & Seller Agree To A Payment Method
(Part 1 of the series)

Step 3: Getting The Domain To The Buyer & Determining The Hosting Arrangement
(Part 2 of the series)

Step 4: Handing The Keys Of The Site To The Buyer OR Transferring The Site
(Part 3 of the series)

Step 1: Buyer & Seller Agree To A Deal

When you buy and sell websites, the first step of the process is obvious – buyers and sellers have to agree to a deal. The seller puts a website up for sale and a buyer steps forward and agrees to buy it. This can be done through a public marketplace like, or it can be done directly via a private deal. The bottom line is, the buyer and seller agree to move forward with a deal.

Step 2: Buyer & Seller Agree To A Payment Method

After a deal has been made, the buyer and seller need to agree on a payment method. There are essentially two ways for the buyer to get the money to the seller. One way is to use an escrow service and the other way is to do a direct payment via PayPal, bank wire, or even check or money order.

Using An Escrow Service

For deals over $1,000, I strongly advise using an escrow service. The most popular escrow service for website flipping is The company has become so popular that it is now even integrated into the Flippa marketplace. There are some that argue isn’t the best option for website transactions but I disagree. I’m not going to get into that debate here as that would be another post entirely. The point is, you should use an escrow service you are comfortable with. I prefer myself because they are much cheaper than I have used both services with success and I have never had an issue with either service.

Regardless of the escrow service you choose, you will need an account at the escrow service you’re going to use. It’s quick and easy (and FREE) to create an account at and I can’t speak to the charges and the processes involved registering an account at other escrow services so you’ll need to do your own leg work if you’re not comfortable with these two companies. Whether you’re going to be flipping one website per year or several, you should have an account with the escrow service you are comfortable before you do any deal so that you can familiarize yourself with the service.

How The Escrow Process Works

Every escrow service will have its own process but for the most part, they are all very similar in how they work. Here is a diagram that outlines the escrow process:

The Escrow Process

Escrow Process

Let’s tackle the process in greater detail. For the purposes of this post, I am going to assume or will be used. Here are links that outline the process and the process. After an escrow service has been selected by the buyer and seller, they will enter into what is a called a “transaction.” Both and allow either party to initiate the transaction. The buyer and seller will just need to discuss who will initiate the transaction. It will be that person’s responsibility to then initiate the transaction and to detail the terms of the deal.

After the transaction has been initiated and the terms of the deal have been outlined and agreed upon by both parties, the buyer will fund the escrow account. Both escrow services offer different methods to fund the account. You’ll note that the seller hasn’t transferred anything to the buyer at this point!

After the escrow account has been funded by the buyer, the escrow service will verify those funds. If the funds come from a bank wire or electronic transfer, the funds are instantly verified when the money arrives. If the account is funded by a check, then the funds aren’t verified until the check clears. Once the funds are verified, then and only then will the seller proceed to transfer the domain, website, and anything else to the buyer.

After everything has been transferred to the buyer, the buyer will essentially notify the escrow service that everything has been received as per the terms of the deal. At that point, the money held in escrow will be released to the seller. The seller will then be able to get the money via bank wire or check from the escrow service.

Dispute Resolution Process

In the event the buyer doesn’t receive all the goods as per the deal, the buyer can file a dispute via the escrow service’s dispute resolution system. Both parties will attempt to resolve the dispute and if it is, then the transaction will move forward and the funds will be released to the seller. If the dispute can’t be resolved, the transaction will be canceled and the goods and money will be returned to the respective parties.

Doing A Direct Payment

When you buy and sell websites, I don’t recommend a direct payment unless both parties have flipped at least one website and have a great deal of trust with each other. Even then, I personally won’t do any deal over $1,000 directly. That is my personal comfort level but you may have your own.

If you decide to do a direct deal, I advise using PayPal as it’s the easiest way to transfer money online these days. If you do elect to use PayPal, be sure to read my post about how to protect yourself when selling websites via PayPal. You can also do a bank wire, personal or certified check, or even money order.

The process of a direct payment deal is similar to using an escrow service except there is no dispute resolution option. As a result, there is little to no protection for either party. The buyer and seller are doing the deal strictly based on trust and hoping nothing goes wrong.

As for the actual process of doing the deal directly, the parties will ideally draft a contract that will be agreed on and officially signed. For big money deals, I consider a notarized signature an “official” signature. At the very least you want both parties to sign off on a written contract – with or without notarized signatures.

The contract doesn’t have to be written by a lawyer either. Remember, you should only be doing small money deals directly anyway so there is no need to involve the expense of a lawyer. You just want to outline, with as much detail as possible, what each party will do and what each party will get in the deal.

After the deal as been officially agreed upon, the buyer will send the money to the seller. Once the seller receives and verifies the funds, the seller will proceed to transfer everything to the buyer. Since there is no formal dispute resolution option when doing a deal directly, I recommend a 50/50 payment structure. Under this arrangement, the buyer sends 50% of the money upfront and the seller transfers “some” of the goods. For example, the seller might transfer the domain only and some files associated with the website. After that has been completed, the buyer sends the remaining 50% and the seller transfers everything else.

Now that you understand the first two steps of the deal when you buy and sell websites, it’s time to move on to the next step of the process – getting the domain to the buyer and determining the hosting arrangement. Continue to part 2 of this series…

Which Is The Best Online Escrow Service?

best online escrow serviceIt’s important that you find the best online escrow service when you are flipping websites priced at $1,000 and above. When you start flipping websites at that level, it’s imperative that both buyer and seller are protected. Outside of hiring a lawyer, using an online escrow service is the next best thing, but which service is best? Most website flippers and domainers will say, but I’m going to buck the trend and recommend

I’ve used both of these online escrow services and have had good experiences with both but I use Safefunds whenever I can because they are much cheaper and the escrow process goes so much smoother with them. Here is why I think so highly of them.

Buyer Funding Options

Safefunds allows you to fund your escrow account by bank wire, electronic funds transfer, or by check. Unlike, they don’t accept funds from PayPal or credit cards. For that reason you may think that is the better online escrow service but think again. If you look closely at’s terms, you’ll notice they only allow PayPal and credit card funds if you use their Premier Service (which is twice as expensive as their standard service) and there is a transaction limit of $5,000. In addition, the funds are subject to’s approval.

Unless your transaction is under $5,000 and you absolutely must fund the purchase via PayPal or credit card – and you’re willing to spend almost double the escrow fees – then I concede is the best online escrow service when it comes to funding options. However, I don’t think that many people fall into that category. If you are o.k. with a standard bank wire, EFT, or check then Safefunds is the way to go.

Seller Payment Options

Safefunds allows sellers to withdraw their funds either by electronic funds transfer (inside the USA), international wire transfer (outside the USA), or by check. Withdrawing by check is free while the domestic electronic funds transfer at the time of this writing is only $12. offers all the same withdrawal options including check by overnight courier , but with the exception of the check via regular mail, which is free, all their withdrawal options cost more than Safefunds. As an example, at the time of this writing you’ll pay $20 for a domestic electronic funds transfer – $8 more than Safefunds.

Online Escrow Service Fees – Where Safefunds Really Shines

Safefunds, like, doesn’t charge anything to open an account with them. There are no fees for the buyer and the seller fees are a flat fee based on the value of the transaction. Let’s say you’re selling a website for $3,500. If you use, you’ll pay 3.25%, or $113.75. At Safefunds you’ll pay just $48! While the buyer technically doesn’t pay any escrow fees with Safefunds, as a seller you can always split the fees with the buyer. In my example, if you and the buyer agreed to split the fees 50/50, you’d pay just $24!

Compare the fees of these two online escrow services yourself. Click here for Safefunds complete fee schedule. Click here for’s fees. You’ll notice the fees for’s “Premier Service” is almost twice that of their standard service.

Defining The Terms of the Transaction

Both of these online escrow services are similar when it comes to allowing the buyers and seller to define the terms of the transaction. There are no restrictions with either service. The buyer and seller have complete control and flexibility in defining how the transaction will proceed and when the funds will be released.

Buyer and Seller Protection

Safefunds provides the same protections for buyers and sellers that does in the event there is a dispute during the transaction. If at any time during the transaction there is a problem, you can file a dispute. Safefunds will get involved immediately to help resolve the dispute and the funds will be held securely in escrow until a resolution has been met between the buyer and seller.

Customer Service

Safefunds customer service is simply amazing. If you send them an email with any questions or concerns before, during, or after the transaction you will get a personal response within a few hours. I can’t say the same with There have been times when I have sent them an email and I didn’t hear from them for a day or more! I have always been impressed with Safefunds responsiveness. I encourage you to test both of them. Send each a general inquiry via email and see which one gets back to you sooner. If I was a betting man, I’d bet Safefunds would be first to respond.

As I said at the beginning of this post, both and have been good to me and are two escrow services I have used and would recommend. I have never had a problem with either service. However, given the advantages I’ve outlined, I believe is the best online escrow service and I use them every time I can.