I’ve had a couple of sales on DAN.com since the last week in March. One sale was a straight-up purchase after a negotiation on the platform, and the second sale was a lease to own purchase using a three year payment plan. I thought I would share a few things I learned about DAN after using the platform for these two sales.
For what it’s worth, I have 271 domain names listed for sale at DAN right now. I started listing late last year with just a handful of domain names. I have added about 250 names in the past month or two.
A few observations and things I learned about DAN:
- After the negotiation concluded on the first sale, I experienced very good communication from DAN to facilitate the transfer of the domain name. The domain transfer was seamless, and I was paid quickly. I can’t think of anything that would have made the transaction happen more smoothly.
- When you sell a domain name with a payment plan, DAN takes a 9% commission. If the buyer pays over one year, the purchase price increases by 10%. If the buyer pays over 2 years, the purchase price increases by 20% in what is called the “long term markup.” I was not aware until after I closed the lease to own deal, but DAN’s commission is 50% of the long term markup amount, in addition to 9% commission on the base price. For instance, if you have a BIN price of $10,000 and a buyer chooses the lease to own option over 13 months, the commission is 9% of $10,000 plus 50% of the additional $1,000 markup.
- Sellers may wish to keep this extra commission amount in mind when pricing their domain names and setting the maximum length of a lease because it will affect the monthly lease fee and the payment amount. In addition, the markup % is taken from every payment, so if a buyer opts out after month one, DAN will still earn a percentage of its longterm markup commission.
- What I shared above is NOT to say that I think this is unfair. In fact, the escrow services I have used all charge an annual fee for managing the deal. I did not educate myself first to understand the fee structure. Unless I missed something, I think the explanation about the commission fees could be a bit more clear. That said, I have added quite a few more names to my account with this lease to own payment option because of the ease of use.
- Setting the price is very important when offering a payment plan on DAN because there is no option to submit a lower offer. I wrote about this previously, but I think it is important for users to understand.
So far, I have had a good experience using DAN, and I have added more names to my account there. Most are standard low to mid-value inventory I have in my portfolio that have BIN prices on GoDaddy already. For people who directly navigate to my listings with BIN prices, I feel like it may be helpful in closing a deal more quickly without the need to negotiate or get involved.
Importantly, I think it is pretty clear already, but DAN is a sponsor of this blog. It’s a banner placement deal, and I am not compensated per lead or per action. Put simply, whether you decide to use DAN or not, I am not compensated more or less.
I have 100 names on Dan. Quick question….I don’t believe there is an option to allow the “lease to own” on just some of your portfolio….seems to me it is all or nothing. I have the “lease to own” on all my names, but I believe there are some that I’d like to exclude. Does anyone have an answer? Thanks. Fred.
On your portfolio dashboard next to the names, there are 4 circles with letters in them. Click the blue “IN” button next to the names you do not want to offer the least to own option on, and the popup has a button to “disable.” You can also choose from the dropdown on the popup to customize the number of months you are willing to offer.
Perfect. Easy, and thanks Elliott.
I’ve tried that multiple times but inevitably it reverts back to the mass setting of all included, for me at least.
Right now, I am testing the all traditional financing option, which limits financing to 12 months or less only.
on the reselling, i dont see where the language prevents someone form “offering to sell” the domain name
and then the resale, if cosummated, would close out the lease transaction.
obviously if the buyer of one of your names doesnt get “clear title” til paid off, they could never offer clear title to a buyer. yes i see how they could possibly “rent” the name
for me, buying a name on payments to then resell has been a good strategy and does provide some liquidity to the market
“10.7 If the Parties entered into the Rental agreement, the Rentor is prohibited to sell or rent the Domain Name to a third party, to pledge the Domain Name as security if such pledge frustrates the (performance of this) agreement, or to act in any other way which is in conflict with this agreement or which may cause damages to the Third Party and/or the Rentee, after the deposit of the domain. If the Rentor violates this clause, the Rentor shall be liable for all the actual damages caused to the Third Party and/or the Rentee.”
From my non-lawyer read of this, renter is not allowed to try and sell a domain name during lease term. If he does and there are legal repercussions, he is responsible for any damages. For instance, if you (the renter) try to sell my domain name before you pay it off and a third party sues me for cybersquatting or files a UDRP as a result of your attempt to sell the domain name you are leasing, you are responsible for damages.
I believe this language prohibiting a sale of a lease to own must have been updated in the terms since the newer lease to own payment structure was put into place. To my knowledge it wasn’t present in the terms previously, with the original structure (before the sliding scale price increase). I know because I sold a domain under payment on the old system last year to what turned out to be another investor who subsequently pointed the name to their own for sale lander, so I re-read the terms to make sure. I can see why it’s now prohibited and I was a little hesitant about it myself, but as Page points out, it could be fruitful to both parties in some cases by improving liquidity provided both parties agree. Not sure how feasible it would be but perhaps there could be too for an additional clause for both parties to agree on whether or not the name can be resold during lease. A contract is simply an agreement after all.
I do like Dan’s system and kind of surprised to learn about 50% cut by Dan of the markup…..I think it is HUGE. It doesn’t excite my to then offer lease plans as I thought before. Also I don’t think it’s clearly explained by DAN. I then rather offer BIN withOUT lease.
Also DAN doesn’t have much inquiries unless you point your DNS to DAN on all your domains. For example, Afternic send me double digit inquiries daily without even using their DNS.
I sold 1 domain few months ago at Dan; just regular sale withOUT lease.
I received $25 less in my bank account than what I was supposed to get (after Dan’s 9% commission).
My bank (Chase bank in US) said they dodn’t charge any fees to receive the money and told me that they paid me exactly what Dan (and Dan’s bank) sent.
I contacted Dan and they said they sent full payment but my bank could have deducted $25.
My bank kept telling me that they didn’t deduct anything at all and told me to contact Dan.
Dan kept telling they sent full amount.
I wasted a lot of time contacting Dan and going to my bank many times but they both kept repeating the same thing. After few weeks, I just gave up and took $25 loss.
I don’t know if it has happened to others.
It was a huge wastage of time. It’s not about 425 because it’s not a big amount but it’s about clarity and business ethics.
Perhaps others or Dan can finally clarify it.
I can clarify that I have never had this issue with Dan. Sounds like the bank is charging a fee; or, it’s a misunderstanding on your part.
No misunderstanding on my part but $25 lost in the transit from DAN to my bank nut no one admits there is an issue. 🙂
My bank even showed me their initial receipt and it was exactly $25 less than what DAN said they sent (and were supposed to send after 9% commission).
Not blaming anyone but something is amiss somewhere.
Depending on the route, there could be an intermediary bank taking their toll.
My bank charged and admitted charging me $25 due to , somehow, an international payment.
Very general question but… how is Dan better than DomainNameSales?
I haven’t used DNS for automated payment plans (if they have them), so I can’t offer a comparison.
Dan offers self-service financing services for the buyer whereas DomainNameSales/Uni Market do not. It makes it easier for the buyer to buy.
DNS is linked to escrow.com which offers that type of service.
I like the automated nature of DAN. I set the price and the max lease term and people can buy the domain name or choose a payment plan. I only need to push/transfer the name to DAN. No need for a broker to communicate with me or a prospective buyer.
Are your nameservers set to DAN?
Yes for most. On a few, I link to the DAN listing under the “for sale” message on the PPC landing page.
Thank you Elliot
I dont agree with you. DAN is not good place to sell domain names, honestly.
We had a very bad experince with them:
Buyer agreed to buy domain name in 20 months instalments, then Buyer paid first instalment, after that Buyer did not pay and changed his mind to buy the domain name. So what happened, guess it ?
DAN did not sent Buyer first instalment to domain owner, yes. They did not send it, they said, agreement cancelled by Buyer and that is why they keep the first instalment, lol.
We are not rely on them. If you are happy with them, that means they know you and you are lucky.
They are not professional at all.
I have sold one domain at Uniregistry using an Escrow.com payment plan and another using Uni’s proprietary payment plan. Both proceeded perfectly.
Here is part of Uni’s description of their system:
“In order to administer and manage a payment plan, Uniregistry charges a setup fee which is 0.45% of the purchase price or $125 USD, whichever is greater, and a monthly $40 USD service fee.”
“The setup fee is required to be paid along with the first payment and the service fee is due with each payment made. If a Buyer decides to pay the remaining balance early, they are not required to pay the outstanding service fees.”
I really like the Uniregistry system. It’s a win-win-win.
The buyer can literally buy time to pay for their domain yet is able to use it straight away. WIN.
The Uni Market collects some extra revenue as payment for all the work they do in administration and disbursement. WIN.
The seller also wins because the deal is saved (otherwise the buyer wouldn’t proceed) and above all you likely receive the full BIN asking price. WIN.
Whenever I receive an enquiry on my domains (which all have a BIN plus a “submit enquiry” option) this invariably leads to some negotiation and if a sale happens it might typically be 20 percent lower.
But with a payment plan, the expectation is that the buyer pays the full price – the trade-off being time to pay.
My payments were automatically disbursed to my bank account in exactly the same way that BIN sales payments are received.
This article has been valuable to me as I use DAN as my default sales platform. I took action immediately disabling all installments for my BIN listings to reduce the risk of non-payment, 50% fee on markup and more. thanks.
It appears that in “DAN 2.0”, when a lease-to-own option is there, there is now the ability for a buyer to make an offer on the domain, even though there is a BIN option. I don’t know if the buyer submits an offer & they come to terms if it is strictly a “pay now” or if the lease-to-own option is still on the table.
Dan is effectively charging 9% plus 15%, total 24% on “lease to own” deals. This is highest commission charged by any domain name brokers. This is just pure rip off. STOP this nonsense. Do not use Dan.
Hi, trying to sell some first domainnames -> which broker can you recomend? Thanks for any hint!