Milestone and Service Transactions on Escrow.com
What is Escrow?
Escrow is the name given to a financial arrangement that uses a third-party to hold and regulate any payments between the two parties of interest. It can help improve the security of online payments and transactions, and it can help to reduce the risk of fraud and scams when people buy and sell goods or services online.
Using Escrow for larger financial transactions isn’t anything particularly new; people have done it for decades in the property business. However, to be able to use a service like this, a person would need to visit a bank or lawyer.
With Escrow.com, this functionality is now within the easy reach of anyone who wishes to use it. So, if you want to buy or sell a used car online, or any other type of product where payment needs to be made online; then Escrow.com can help you do that in a secure and affordable way.
For more information, and a quick step-by-step explanation, take a look at this page about how payments with Escrow.com actually work.
What are Escrow Milestones and Service Transactions?
When we refer to a milestone or a service transaction on Escrow.com, they are actually the same thing. A milestone transaction is when a payment is made in lieu and held until such a point the service or product is delivered or carried out.
Milestone transactions divide a transaction into multiple phases. Milestone transactions can be used for a transfer of goods, services, or a combination of both goods and services. For instance, let’s say you are hiring a freelancer to do some work for your website. You can arrange the milestones in such a way that you can release 50% of the payment when the draft is complete, and the remaining 50% upon final completion.
Buyers are required to fully fund milestone transactions at the start of the transaction before any goods are delivered or any work is completed by the Seller. Sellers receive funds as they successfully complete each milestone within a transaction.
As the transaction details are established, the Buyer and Seller will need to agree who will pay the fees or if they will be split 50/50. For a normal transaction, you can select Buyer, Seller, or 50% Buyer / 50% Seller. The option to select who will pay the Escrow fee will depend on the type of transaction you are creating.
What are the Benefits of Using Milestone Payments?
One of the greatest advantages of using milestones with Escrow.com is that they benefit both the Buyer and the Seller. Here’s a summary of the reasons why millions of people from around the world have already used this service.
- The Seller can see the payment is held in Escrow, boosting their confidence in the transaction and the Buyer
- It can be used for a range of goods and services
- The Buyer knows their money is safeguarded by a third-party
- There is a lower risk of fraud when using milestone payments
- Inspection terms and conditions can be set and agreed upon with ease
- Escrow.com is a trusted and fully licensed Escrow company
Apart from being incredibly easy to use, both Buyers and Sellers get peace of mind, reduced risk of fraud, and can feel completely confident and clear about the terms. Click here to learn about the Step-By-Step process for milestone transactions.
Please see our Frequently Asked Questions for additional concerns related to Milestone and Service transactions.