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The guy seemed to be very experienced in domain transactions, and immediately offered to pay by PayPal. I declined and set up an escrow transaction, which he agree to but never completed payment. I'm about to cancel the transaction because I believe that "Buy it Now" means buying in less than 2 weeks, which has already been exceeded. He thinks he's done what he should have because he offered to pay for it originally with PayPal.
My question is this: Is PayPal an acceptable method of payment for a major domain purchase? Keep in mind that PayPal does not guarantee non-tangible product purchases, so if I took payment via PayPal and transferred the domain, he could for no reason at all dispute the purchase and PayPal would refund him in full, and I would have no recourse, NONE AT ALL, except maybe take him to court, and he lives in another country.
So is PayPal an acceptable method of payment for a major domain purchase?
The inability for a buyer to do a PayPal chargeback even includes outright fraud by the seller, i.e. seller say's domain gets 100 uniques/day but it really only gets 6/day. Even if seller admits in writing he lied about the stats PayPal still is on his side in the dispute. Experienced that first hand a few mos ago :(
Did the escrow company notify you the Buyer had made payment, but they were in the process of verifying that the funds were good?
No, according to the escrow company he never started the payment. He only selected which payment method (wire transfer) he was going to use.
Sellers do not need to worry much as a buyer can not win a PayPal chargeback in those cases.
I don't understand what you are referring to. Anyone who makes a purchase through PayPal can dispute the purchase, and it is up to the seller to provide proof of shipping, which of course with domain names, there is no shipping... and whois information isn't accepted. At least that's how it's worked with us in the past.
Most of my larger sales ($5k+) have been via brokers but for direct sales of that size I've used escrow.
Perhaps the key point is your sale listing should have specified how you accept payment. It's not something that should be decided after a sale is agreed. Paypal is just about standard, unless something else is mentioned.
I don't understand what you are referring to. Anyone who makes a purchase through PayPal can dispute the purchase, and it is up to the seller to provide proof of shipping...
Totally incorrect information. Domains and other electronically delivered non-tangibles are simply NOT eligible for any buyer protection. Proof of shipping and receipt of the item is only applicable on tangible goods.
Yes, the domain or electronic service buyer can always file the dispute but nothing will happen until 20-days later when it elevates to a claim and PayPal sends out email to notify the domain buyer they lost the case for the reasons stated before.
PayPal will not look at the Whois or even ask if ownership changed. In fact, they will do absolutely nothing. All they care about is the fact electronic items have zero buyer protection (even if fraudulent marketing is involved, which they do not investigate or even look at that aspect involving non-tangibles).
The exception where the buyer can win is if he lies and say's his PayPal acct was used without his permission and he never ordered the domain.
The exception where the buyer can win is if he lies and say's his paypal acct was used without his permission and he never ordered the domain.
Trader, thanks for those insights. It sounds like sellers do have cause for concern using PayPal. How well could a fraudster play that card? Can anybody (3xVince?) identify the dangers with wire transfers? I stopped accepting wire transfers this year because of the fees and delays, but I'm also leery of giving out bank numbers.
After what you said, Trader, I can much more easily imagine a buyer talking PayPal out of the money transfer, than I can imagine a seller talking Godaddy out of a domain transfer.
I would be careful using PP for large domain transactions - maybe it's safer if you can make sure they pay using their PP account rather then funding the transaction using a credit card.