Buying a website from a stranger on the internet means one side has to trust the other: the buyer does not want to pay before getting the site, and the seller does not want to hand over the site before getting paid. Escrow solves this. A neutral third party holds the money until both sides have done what they promised. This guide explains how escrow works in a website sale, step by step, what it costs, and how to use it safely.
What escrow is, in one sentence
Escrow is a licensed or trusted intermediary that receives the buyer’s payment, confirms it to the seller, waits for the assets to be transferred and accepted, and then releases the funds.
The escrow process step by step
- Agree on terms. Price, assets included, inspection period, who pays the fees, and the deadline for the transfer.
- Open the transaction. One party creates it with the escrow service; the other accepts the same terms.
- Buyer funds escrow. The payment goes to the escrow service, never to the seller directly.
- Escrow confirms funds. The seller receives confirmation that money is secured.
- Seller transfers the assets. Domain, files, accounts and everything on the asset list.
- Inspection period. The buyer checks that everything was received and works.
- Buyer accepts. Or raises a problem within the inspection period.
- Funds released. The seller is paid, minus any fees agreed.
The transfer itself is covered in detail in the website ownership transfer checklist.
Who pays the escrow fee?
| Option | When it is used |
|---|---|
| Buyer pays | Common when the seller has many interested buyers |
| Seller pays | Common when the seller wants to make the offer more attractive |
| Split 50/50 | The most neutral option, often the default |
Fees usually depend on the deal amount and the payment method. Confirm the exact fee with the service before opening the transaction, and write who pays it in the agreement.
The inspection period
The inspection period is the time the buyer has to confirm the assets. It should be long enough to check the domain, the site, admin access, analytics and revenue accounts, but short enough that the seller is not left waiting. A few days is common for small sites; larger deals may need more. Agree on it before funding.
What happens if there is a problem?
If an asset is missing or does not work, the buyer reports it during the inspection period. Most disputes are solved by the seller fixing the issue. If not, the escrow service follows its dispute process, which can lead to a refund once the assets are returned. This is why a precise written asset list matters so much.
Escrow mistakes to avoid
- Paying the seller directly, even a small deposit, outside escrow.
- Using an escrow site suggested by the other party that you cannot verify independently. Fake escrow sites are a known scam.
- Transferring the domain before the escrow service confirms the funds.
- Accepting delivery before checking every asset.
- Leaving the inspection period undefined.
Frequently asked questions
Is escrow necessary for small deals?
The smaller the deal, the more tempting it is to skip it, and the more common scams become. Use escrow whenever you do not know the other party well.
How long does escrow take?
Funding can be quick or take a few business days depending on the payment method. The full process usually follows the time needed to transfer the assets.
Can the seller cancel after funds are in escrow?
The terms accepted in the transaction apply. If the seller does not deliver, the buyer’s funds are returned under the service’s rules.
Key takeaways
- Money goes to escrow, never directly to the seller.
- Assets move only after funds are confirmed.
- Define the asset list, fees and inspection period in writing.
- Verify the escrow service yourself.
Selling? Prepare your file with documents you need before selling a website, or request a free review.