Real Estate

15 Habits for Success in Real Estate Investing

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1) Develop Successful Habits

Success is a result of successful habits.  We all have the same twenty-four hours in the day; take the opportunity to replace bad habits with successful ones.  Every moment is an opportunity to make a difference.  Turn off the television, eliminate frivolous gossip.  Allocate fifteen minutes or an hour a day to make progress on your goals.  When the time you set is over, stop.  A little effort goes a long way, so there is no need to burn yourself out.  After his descent from Mount Everest, one climber was asked how was he able to conquer the tallest mountain in the world.  To which he answered, “One step at a time.”

 

 

2) Prioritize Your Time

Predictions of Nostradamus, a purple booklet with gold sparkling stars, caught my eye one Sunday while I was waiting in line at the grocery store.  From ancient soothsayers to existentialists, from Einstein to H.G. Wells, humanity has invested volumes of discourse on the subject of time.  Notwithstanding the efforts of the most brilliant thinkers, most people are still frustrated by their time constraints.  A few lucky people, however, movie stars and millionaires, seem to have escaped the hands of the clock.  Their lives are not a nine-to-five treadmill, but a leisurely stroll with time to “smell the roses.”  The truth is we have more control over the hourglass than we realize.

 

Someone once said that the dividing line between success and failure can be expressed in five words: “I did not have time.”  Have you really no time?  None?  Pity you!  Perhaps your idea of having time is not having some time to yourself, but having all the time with nothing to do.  Do you really need all the time?  One of the most important lessons you will ever learn is that time is your most valuable resource.  Time is non-replenishable, and successful people are people who use that precious resource most efficiently.  Learn to see every moment as an opportunity.  Never waste a step, a word or a gesture.

 

Do you know the value of minutes?  I once read about a man who’s wife kept him waiting a few minutes every evening before dinner.  After a while, it occurred to him that eight to ten lines could be written in that interval, so he kept paper and ink nearby for that purpose.  In a few short years, during those long minutes, he finished several volumes of spiritual meditations.  How do you pass the time in taxis or trains?  Are you like most people who hate waiting because they get bored or are you a productive person who relishes extra time for thought or work?  The latter lead the rest.

 

Think of all the ways you can find time to reclaim.  If not from work or family, reclaim it from pleasure that really gives no pleasure: television, indulgent social activities, wasted trips, and especially empty talk.  Have you ever wasted time with “The Drain Person?”  In his book Looking Out For #1, Robert Ringer describes this character who steals away your time, draining your insights and offering nothing in return.  Discriminate between kindness and weakness.  Don’t hesitate to reclaim your time from idlers.

 

Using a schedule or a “Do List” is another great way of maximizing your free time.  With her background in industrial engineering, Mrs. Parrish, my wife, is an archetype of efficiency.  She sections her days into an efficient series of actions by grouping related activities.  For example, if her week involves several activities downtown, she will arrange them all into a single trip.  De-fragment your schedule by grouping your appointments back to back, each with a time to begin and a time to conclude.  Make sure to honor the efficiency of your schedule by being punctual and ask the same from others.

 

Your successful habits are based upon priorities, one of the hallmarks of a successful lifestyle.  Recently, a friend asked when I plan to replace my Jeep with a Beamer or a Mercedes.  “Would it be more frugal to spend $60,000 on a new car, or invest that money at 15%?” I answered.  According to the best-selling study of America’s millionaires, The Millionaire Next Door, most millionaires believe that financial independence is more important than displaying high social status.  Don’t be “all show, no dough.”  Don’t trade your bank account for shiny metal and glossy tires.  Prioritize your wants and needs.

 

 

3) Recharge & Refuel

A paper published in a popular science journal revealed that most Americans are sleep deprived.  The body and mind function at optimal performance when they are properly rested.  Schedule an ample number of sleeping hours and stick by them.  You will have more energy throughout the day, be more productive, and enjoy a more positive outlook.  Did you know that Winston Churchill, Malcolm X, and many top professionals who have been interviewed about their personal habits claim to maintain their energy by taking naps?

 

Supplement your regular sleep schedule with proper eating (and drinking) habits.  If you “don’t have time” to eat breakfast (or lunch), make time by waking up fifteen minutes earlier.  Also, give your body plenty of the liquid it needs to keep you happy and healthy.  A noted university study explained that most Americans suffer from dehydration; in fact, they found that thirst causes swelling of the brain which actually leads to headaches, tiredness, joint pain, disorientation, and even depression!  Instead of drinking coffee and soda which dehydrate the body, try water.

 

Nutrition, hydration, and sleep lend themselves to healthier emotional states.  Although mention of them may seem trite, they are the foundation of successful, clear-headed, motivated individuals.

 

 

4) Work Out

With your body properly fueled, you can harness the power of exercise.  It isn’t necessary to join a health club.  Exercise is free!  Simple things like jogging in place for five or ten minutes, walking around the block or doing 25 jumping-jacks in the morning will increase your energy throughout the day.  When you have energy, you’ll feel good.  When you feel good, you’ll be positive, and people will notice.  Are you ready to be noticed?

 

 

5) What it Means to Dress “Professionally”

In negotiation, we strive to create a connection with the other party such that they see us as someone who understands, someone with whom they can identify.  In his books Dress for Success and The Woman’s Dress for Success Book, John T. Malloy explains that one of the secrets of successful dress is to mirror your environment.  He explains that the right choice of attire can help bridge your connection with the other side.  For example, wearing a suit to negotiate with a farmer on Maryland’s Eastern Shore might actually make him suspicious or mistrustful.  I disagree.

 

That good old Eastern Shore farmer who’s been huntin’ and farmin’ for 50 years, is not going to be fooled by a city slicker who thinks he’s going to create a connection by throwing on some jeans and plaid shirt.  I just can’t see the farmer hopping down from his tractor to say, “Ooh!  You’re wearing Wranglers?  Wow, me too!  Where did you get that flannel?  The Gap?  Oh my God, we have so much in common, let me sell you my farm!”  To me, part of being professional means dressing professional—even if that means dressing “above” your prospect.

 

As Mr. Malloy explains, negotiation IS about creating a connection between the parties involved.  However, you are NOT what you wear.  From the first moment I meet a prospect, I begin bridging a connection using my words.  It is okay if my prospect perceives (through my attire) that I am successful and knowledgeable about real estate, because I make sure that they also perceive (through my words and actions) that I am fair and sincere.

 

In fairness to Mr. Malloy, I agree that it is okay to adapt your attire slightly depending on the situation.  For example, when speaking to a labor unions the President of the United States will abandon his suit jacket and tie, and neatly roll up his sleeves.  Still, his uniform is essentially a suit, adapted.

 

Your Message Matrix

Effective communication is crucial to successful negotiations.  To be an effective communicator you must uniformly coordinate your words, dress, and body language so that your intended message will be understood.  When your verbal and non-verbal communications are synchronized, listeners are more likely to receive and buy in to your message.

 

Baltimore sports journalist Gerry Sandusky once shared with me a system he uses to communicate effectively on television.  He calls it “The Message Matrix.”  Using Gerry’s Message Matrix diagram below, ask yourself:  Am I speaking on the same level as others?  Is my tone of voice in line with my point?  Do my facial expressions show impatience or interest?  Does the posture of my torso convey confidence or tiredness?  Am I maintaining eye contact?  Does my attire help or hinder my message?  Only when your personal Message Matrix is packaged uniformly, will you be ready to communicate effectively.

 

[DRAWING 4] The Message Matrix

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Your professional wardrobe should consist of a few contemporary suits and polished shoes.  A professional uniform is neutral, does not offend, and demonstrates to others how you value yourself.  Complement the power of your attire and show your worth by grooming yourself properly.  Be neat and clean, but not slick or overdone.  Be a class act.  Gum-chewing, cigarette smoking (or smelling like an ash-tray) are dead giveaways of an amateur or someone who just doesn’t care about making the right impression.

 

 

6) Organize

If you ever hear yourself saying, “I forgot” or “I didn’t think,” you’re probably wasting time retracing steps.  You will hardly ever forget, fumble, and revisit mistakes if you cultivate two easy habits: foresight and order.

 

To foresee means to imagine in advance.  People who visualize future events have an advantage in the present, because they’ve already been there in their mind!  A quarter of an hour can be saved by knowing where your car keys will be in the morning.  Time and fuel can be saved when running Saturday errands by planning a driving route.  A couple minutes of bookkeeping every week can save hours—even days—at tax time!

 

Order, the sister of foresight, means a place for everything and everything in its place.  But don’t mistake order for tidiness!  A friend places loose documents in a basket on his desk.  “Neat and manicured,” he says—but wait!  Where is the water bill?  A rustle in the basket uncovers letters, some opened, some in envelopes, bills, tickets, invitations, and other papers!  His clean and tidy pile is as ineffective as if the papers were scattered on the floor.

 

Stop and approach with order: unopened letters go on the desk to be opened, paid bills are filed, magazines go on the coffee table, slips of papers with phone numbers go in an electronic organizer or planner, and the rest goes into the wastebasket.  “But cleaning out my mail basket only takes me thirty minutes,” he argues.  I see a half of an hour wasted by not being methodical.  Even worse, the same clutter in his mail basket was also in his mind and in his life.  He loses time because of it, it makes him inefficient, and less effective.

 

 

7) Create a Workspace

As a productive person, your workspace is like a shrine.  There, you will concentrate your energy on creative thought, and focus on progressing toward your goals.  Set up a quiet place to work, away from distractions such as radio, TV, and other people.

 

Your workspace should be clean and organized.  Popular speaker and investor Dr. Albert Lowry once told me that he uses bright colors such as red and orange near his workplace in order to stimulate thinking.  Plants are also useful because they fuel the brain with oxygen.  Other necessary tools include:

 

[INSERT 3]

Workspace tools:

telephone                                             answering machine

fax                                                       pens

pencils                                                 highlighters

computer with an Internet                  printer

plenty of white paper                          colored paper

bright reading light                             file cabinet

file folders                                           stapler & staples

tape                                                     white-out or correction tape

dictionary                                            thesaurus

trash can & bags                                  water container

 

 

8) Make Yourself Lucky

From time to time in life, we are lucky enough to hit a home run.  Sometimes in real estate a profitable transaction or a free house just “falls in our lap.”  I’m a firm believer in luck.  It’s funny, the harder I work, the luckier I become.  If you’re willing to work hard, you have the power to make yourself lucky too.  Think of luck as the crossroad of preparation and opportunity.

 

You can prepare yourself to be in the right place to find opportunity.  Instead of looking in the newspaper for real estate opportunities, for example, my students avoid the competition and use lesser-known methods such as tax sale, escheat, pinks, and others.  It is no coincidence that by going where motivated owners go, by preparing ourselves to be in the right place at the right time, we frequently get “lucky.”

 

Success is not a destination, it is a process.  Success involves hard work, tough decisions, and problems too.  Knowing how to negotiate will not help you avoid hard work, but it makes your hard work more likely to pay off.

 

 

9) Be Sincere

When negotiating, it is a good policy to be sincere about your intentions.  It may seem obvious now, but it may not be so easy to be sincere in the field.

 

When we negotiate, we seek something:  profit, love, sex, material gain.  Whatever it is, it is best to be up-front about your desires.  By confronting the object of your negotiation squarely, you can eliminate suspicion about your intentions.  When buying real estate for an example, I tell my prospects that my intention is to make a profit.  With my intention out in the open, there are no hostile feelings about any hidden agenda.

 

Also, be sincere in your desire to help others and let your prospects know about it.  Being kind is the best way to show that you care about others.  Disarm your prospects with open-hearted gestures.  Comfort your prospects with kindness, generosity, and selective honesty.  Offer them something to drink, ask about their family, spouse, kids, likes, hobbies, walk them to the car, etc.  When you are sincere in your desire to help others, the limits you set in your negotiation will be seen as nothing more than your limits, and not an attempt to “get over” on your prospect.  Remember, a tactic perceived is no tactic at all.

 

 

10) Be Confident, Not Hesitant

If you have ever dealt with a salesman who’s selling showed, you know how painstaking it can be, like watching a tired dog circling ’round and ’round before finally plopping down.  As prospects, when we become aware of the selling process, the magic vanishes and we feel begin to feel mistrust and contempt.  Don’t play the role of the tired dog!  Don’t allow hesitation to get in the way of your dreams and desires.

 

The opposite of hesitation is confidence.  For example, a Captain and an Ensign enter their ship’s mess hall for a snack.  “What’ll it be Cap’n?” asks the cook.  Without pause the Captain responds, “Black coffee, hot, and a slice of pecan pie,” and moves down the line with his tray.  The Ensign, on the other hand, needs a moment—apparently to weigh his options, consider the menu, his tastes, his mood.  “You’ll never make Captain like that,” the cook interrupts, “The Captain always knows what he wants, whether it’s pecan pie and coffee or full throttle and power to weapons.  That’s what makes the Captain a successful leader.”

 

Confidence means decisiveness, boldness and enthusiasm.  Confidence elicits an opposite psychological response in a prospect than does hesitation.  Whereas hesitation puts obstacles in your path, confidence eliminates them.  Whereas hesitation makes your prospect aware of your intentions, confidence leaves no time for reflection or awkwardness.  Confidence can strike fear and create authority.  The confident have “presence.”  They draw attention and power.  People can not keep their eyes off the confident, they cannot wait to see their next move.

 

 

11) Be Enthusiastic

Negotiation takes place on both verbal and non-verbal levels, and often more important than what we say, is how we say it.  Stirring the right emotion has more power to close a transaction, than does presenting sound logic.  No matter your mood, it is critical to begin all negotiations with confidence and enthusiasm, because the opening moment sets the tone for the entire meeting.  Open your meeting on a dull note, and the mood will hang over the table like a grey cloud.

 

“To be enthusiastic,” the motivational Dale Carnegie said, “act enthusiastic!”  Harness the power of positivity, because anything worth doing is worth doing well.  You can experiment with the power of enthusiasm by speaking with clerks, coworkers, and others.  Anyone who makes eye-contact presents a perfect training ground.  Try using a sincere compliment to initiate conversation.  See where your enthusiasm takes you.  Eventually, your attitude will be rewarded with discounts, favors, special treatment, maybe even a date.  You will be someone that other people want to be around.  Moreover, you’ll be a better negotiator.

 

 

12) Be a Don’t Wanter

Everyone has experienced the power of a crush.  In high-school, when the freckle-faced girl found out I had a crush on her, she played hard-to-get and exercised special powers over me.  When you negotiate, you can prevent the other party from playing hard-to-get by developing your “power posture.”

 

Your power posture is your figurative negotiating stance.  The most successful negotiators develop the “Don’t Wanter” posture.  Don’t Wanters are friendly, but disinterested; they know that there are too many available opportunities to settle for mediocre terms.  For example, whereas novice negotiators try to convince sellers to sell, Don’t Wanters let sellers convince them to buy.  The Don’t Wanter’s philosophy is that he can take his cash and go somewhere else.  Being a Don’t Wanter means letting the other side sell you.

 

As if you were donning a top hat, slip into your Don’t Wanter power posture.  Develop an attitude:  you have what they need, and you have limited interest.  Your face should be a chalkboard; write nothing unless you want it to be read.  Be friendly, but maintain your emotional distance.  Empathize, but redirect the conversation to your needs.  Like beauty, power is in the eye of the beholder.  Power is the seller’s perception that you can help them or hurt them.  Power begins with you.  If you think you have it, you have it.  If you don’t have it, fake it ‘til you make it!

 

Half of your power as a Don’t Wanter is derived from what you do not do, what you do not allow yourself to get dragged into.  Do not tell on yourself; keep your faults and your shortcomings to yourself.  If you are a recovering alcoholic for example, keep it to yourself.  It can only hurt your image.  Do not address topics such as politics and religion, sometimes your honesty is likely to offend.  Never be defensive, and never lose your temper.

 

 

13) Refer to Reputation

What is unsaid and unseen counts for nothing, so maintain a sterling reputation and by all means make it conspicuous.  Do not be subtle, use your reputation as a calling card.  Refer to your history, character, devotion, goodwill, community service, successes, citations, successes, etc.  Use actions and demonstrations.  They are more powerful than words.

 

 

14) Learn to Say Less

Said the reknown composer Wolfgang Amadeus Mozart, “The silence between the notes is just as important as the notes themselves.”  Artist, inventor, philosopher, and Renaissance man Leonardo da Vinci (1452-1519) also recognized the power of silence when he wrote, “Oysters open completely when the moon is full; and when the crab sees one, it throws a piece of stone or seaweed into it and the oyster cannot close again so that it serves the crab for meat.  Such is the fate of him who opens his mouth too much and thereby puts himself at the mercy of the listener.”

 

We humans are machines of interpretation and explanation; naturally, we want to know what others are thinking.  When we say less than necessary, we inevitably appear greater and more powerful than we are.  The less we say, the lower the chance of saying something foolish, the more weight our words carry, and the more control we seem to have.  The more we say, the more common and less in control we appear.

 

Practice speaking for a purpose, instead of speaking to avoid silence.  Choose your words precisely.  When you are not speaking for a purpose, become comfortable with silence.  Practice using silence to solicit information, to portray discontent, or to arouse interest.  Peak your prospect’s curiosity by resisting the urge to explain details.

 

 

15) Vocabulary

Negotiation is about effective communication.  Therefore, your vocabulary is paramount to your ability to negotiate successfully.  Like your attire, your vocabulary should remain professional regardless of the person with whom you are negotiating.  Although, your vocabulary should never be base or unprofessional, it is okay (again like your attire) to adapt it slightly.  For example, you might exchange a “good day” for a ”howdy” depending on your environment.

 

Of course, there is certain vocabulary to avoid entirely.  Cursing is viewed by many as a sign of an unworldly or inadequate vocabulary.  If your intention is to make a point, consider how you can make that point without vulgarity.  Poets do it all the time.  A point made without vulgarity can carry as much weight, if not more.  You don’t have to be a wordsmith to circumvent coarse language, just be more descriptive than a four-letter word.

 

Vulgarity aside, there are also conventional words and phrases that have a way of throwing a conversational red flag.  Have you noticed that the phrase “trust me,” just doesn’t sound right coming from a salesman?  Or have you ever heard, “I’m going to be honest with you,” and wondered to yourself, “Does that mean they were lying to me before?”  If you use these phrases, strike them from your vocabulary entirely.

 

Sometimes, people who use those phrases are decent folks who just lack the skill to express themselves, but more often than not, they are trying to “snow” you.  Hallmarks of con artists, liars and thieves, those phrases should stand out in your mind as warning beacons.  When you hear them, be alert to what is actually transpiring in the conversation.  For an example, “Trust me” is an easy phrase to side-step facts and figures.  If you hear it used as a substitute for details, insist on the hard facts.  You might use higher authority to get the truth, “I trust you, but my attorney is very specific and very insistent.”  People who say, “I’m going to be honest with you,” have honesty in the forefront of their mind—probably because they are intent upon deception.  When I hear that that phrase or expressions such as “honestly,” “truthfully,” or “on my honor,” I tell the speaker in a serious voice, “I expect nothing less than honesty from you.”

Domain Names

The Essentials of a Domain Name Rental Lease Agreement

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The Essentials of a Domain Name Rental Agreement
Once you’ve satisfied yourself that you’re not renting tainted goods, it’s time to concentrate on the rental contract itself. Here are
some of the basic provisions that your attorney must be certain to examine and negotiate, as necessary, among the many contained
in a standard domain name rental agreement.

Term of the Lease

One of the first issues to address in a domain name rental agreement concerns the term or length of the lease. Here, it is typical to try to negotiate either a perpetual
license, which will likely be expensive, or, at least, obtain options for a certain number of extensions. An attorney for a lessee of the domain name also may try to
negotiate a right of first refusal, meaning that the lessee would have a chance to match or beat another offer for the domain name when the current lease expires.

Warranties and Indemnities

Another provision to key in on concerns warranties and indemnities. While typical domain name rental agreements require the lessee to indemnify the domain name
registrant or “landlord” against claims or damages either from illegal use or otherwise, lessees should take care to try to achieve some reciprocity here. Even though
you’ve done your due diligence, it’s still comforting to obtain written representations and documentation from the registrant that it owns the name and that it has no
knowledge of any claims or proceedings, pending or threatened, based upon use or ownership of the name.

Transfer Rights

One important but often overlooked clause in these agreements relates to transfer rights. In a rental context, most agreements
prohibit the lessee from transferring its rights to the domain name to someone else. This is essentially like prohibiting someone from
subleasing or assigning rented real estate.

But, just as in the real estate world, there are often good business reasons that require some ability to transfer in the domain name
rental context as well. One example would be to another entity that acquires the lessee’s business. Another would be in the case of
bankruptcy, where the lease of the domain name might constitute a valuable asset. So, it’s important to make sure your attorney
tries to obtain some flexibility in this clause.

Cancellation and Jurisdiction

Two other vital clauses to inspect and negotiate concern cancellation rights and jurisdiction.
A cancellation clause describes when and how your lease may be cancelled, as a result of your claimed breach of the agreement.
Here, the task is to make sure that you clearly spell out what types of claimed breaches will justify cancellation and what notification
and cure procedures will be built in to make sure your lease isn’t cancelled without your knowledge or an ability to cure or contest the
claimed breach.

Also, since any contract’s clauses are only as good as the ability to enforce them, it’s important to spell out clearly what type of a
forum will be used to settle any disputes. This can range from courts to arbitration or mediation, but, regardless, it is vital to spell
out where such disputes will be heard and what law will govern the dispute. The choice of forum and applicable law, taken together,
are the guts of the jurisdiction clause and careful attention must be paid to avoid having a contract that will be difficult to enforce if —
or when — the time comes.

Hosting Combinations

It is common for domain name landlords to offer to build hosting services into the rental agreement, often at no extra charge — but
think twice before agreeing to it. Despite negotiating fair cancellation and notice clauses, keep in mind that if your domain name
landlord also hosts your web site, it’s all too easy to shut it down in the event of a dispute. Since hosting services are increasingly
inexpensive, it’s often better to have a third party host with no stake in any possible dispute as your host, than to rely on your
domain name landlord.

Purchase Option
Lastly, decide if you would really like to have ownership of the name at some point, even if not immediately. If so, negotiate an
“option to purchase” with the vendor, something most domain name landlords will do with at least some of the names in their
inventory.

In the domain name rental context, an option to purchase usually runs concurrently with the lease, meaning that it’s doubtful you’ll be
able to purchase a “naked” option, an option not running with a lease. The option agreement ideally should be negotiated and signed
during the negotiations for the lease, as this is when the domain name landlord likely will be most flexible on price.

Conclusion

If you don’t want to buy, or cannot, then be sure to focus on the legal points of any rental agreements you consider, as squabbles and
litigation over domain names are prevalent and, in a world where domain names are scarce, aren’t confined to fights between owners
of domain names. Now they can be between owners and renters of domain names as well.
This article was originally published on GigaLaw.com in January 2002

 

 

Domain Names

Selling Expired and Organic Domain Name Traffic

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Sell Your Traffic

This is what a lot of the big time successful domain name companies will do with useless traffic, low click through rate, or low CPM traffic domain names
that they control. If your domain names are not meeting minimal standards of at least $4 CPM and you have not been able to sell your domain name there
is still hope. This strategy is for domain name holders of large portfolios though, this is not recommended if you only have a few non-performing domain
names. You can setup a simple website that will take orders from buyers seeking traffic. This site will have to include the categories of content, language
of visitors and countries, and be able to control the amount of visitors sent to certain domain names daily. Many scripts of this nature can be purchased
from hotscripts, or scripts.com. This should be for experienced domain name investors that know what they are doing and what traffic is actually worth.
If your portfolio consist of domain names that are one or two words, or they are peoples names, than you might have some interesting alternatives.
The following is a great article that is from GigaLaw.com and was originally published in January 2002, and is a great article that explains the process of
renting, leasing, and contracts to use if this is something you wish to consider.

Renting a domain name from someone who’s already registered it sometimes can be an attractive (or the only) option available if you
want to use it. Doing so can be cost-effective, particularly if your need is only temporary or if you want to gain the benefits
associated with a pre-existing domain name. This article explains how renting a domain name works and what should be included a
contract for a domain name rental.
Reasons for Renting a Domain Name
Everyone knows the value of registering a domain name. Registering one allows branding of your product or service, a possible
trademark or service mark, as well as a method of making sure that everyone knows where to go on the Internet to learn more about
your company or do business with it.

But there are situations when registering a domain name may not be in your best interests or may not be necessary. Sometimes, for
example, you need a generic domain name for a short period of time, say for a temporary promotion. In that case, searching for an
available appropriate domain name may not be worth the time and trouble.

Other times, getting the name you want may not even be possible. As has often happened to aspiring domain name holders, a
particular domain name already could be taken by someone else who either doesn’t want to sell it or who wants an exorbitant amount
to do so. For example, in 1999, “business.com” was reported to have sold for over $7 million.

Or, you may have risked being closed out of a particular name and top-level domain by restrictive procedures and lockout periods like
those used in the initial launches of the “.biz” and “.info” top-level domains.

For one or more of these situations, it is sometimes possible to rent domain names, much like renting a piece of real estate when
ownership of the property is either impossible or undesirable. And there are several places on the Internet where you can do this.
The questions, of course, are whether you should, and what protections you’ll need if you decide to do so. Let’s look at the basics.

Who Should Rent a Domain Name
Are you a suitable candidate for renting a domain name?
In many ways the marketplace for domain name rentals can be limited. And for good reason.
First, one of the main points of getting a domain name is to exercise control over the name and use it to help in branding your
business or service. In some cases, you might even be able to obtain trademark rights in it.
These advantages offered by domain names often disappear in the rental context because you don’t own the domain name and typical
rental agreements specifically prohibit any efforts by the “lessee,” — the person or company renting the name from its registrant —
to acquire trademark or other proprietary interests in the name.
As a result, any dollars spent on advertising and promotion are inevitably short-lived with no lasting effect to the domain name
lessee.

Additionally, a lessee of such a domain name may not have the right to renew the lease when it expires and likely will not have the
leverage to force the owner to renew the lease or to agree in advance on what the rent for a renewal lease will be before the original
one even expires.

As a result, the best candidates for renting domain names are either ones who need it for only a temporary period of time, such as in
connection with a particular promotion or other short-term project, or those who benefit from what’s called “type in traffic,” that is,
names such as “sex.com” that are so generic that customers type it in directly rather than learning of it through advertising.
If you are a candidate for a domain name rental agreement, what should your next step be?

At the outset, do your due diligence. Go on the Internet and verify that your proposed domain name is registered to the person or
company renting it to you.

Also, do a trademark search to make sure that no one else is claiming trademark rights in the name.
After that, have your attorney do a search to try to uncover any court actions or administrative proceedings pending against the
registrant of the name.

 

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