Plus, there is always the flip side. If your buyer fails to pay the second payment and you get your property back by default are you sure it will be the worth the same?

Imagine this scenario…

Last year you received 2 offers for a mortgage lead generating website. Offer (A) is $1M and offer (B) is $1.5M except the $1.5M offer includes 3 annual payments of $500k.

Fast forward to today’s market – buyer probably would default and you couldn’t sell it for even close to last years price.

Result, you’re sales price is now effectively $500k less than option (A) and you hold an asset which may have substantially less value in current markets. Yes, you still have the website but then there’s the question of how the other party used it during the last year.

Was the brand tarnished?
Did the traffic entirely die off?
Were old systems replaced with new?
Did the domain get banned from search engines?

Remember, cash is not the only element. Once you transfer use to another party – you not only take the risk of default for future payments you are also betting on continued successful use of the business until your other checks clear.

Going further, assume the buyer and seller use different currencies at home. I know a few people who still have generous amounts (over 500k) pending from transactions involving multiple payments. The assets they sold could be worth more or the same today but instead they are losing money daily as the dollar gets rocked – Ending up with 20-25% less than originally planned when converted to their home currency. In the case above the $500k second payment is no longer 500k – more like 400k and still dropping. The factor here is not the buyer – it’s something that’s entirely out of your control and not even an attorney can help (unless a currency provision was included in the original contract which is highly unlikely)

It comes down to a matter of choice and whatever lets you sleep at night

Am I missing something?

For #2 offer, the domain should have been put in escrow until paid in full with the understanding that any payments made are yours (Seller’s) if the Buyer fails to complete the purchase.

The Buyer could have used the domain but not obtain ownership until paid in full.

Monies paid to date cover usage and taking domain off the market.

Agree?

Disagree?

Patrick

I look forward to the next one.