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GoDaddy Lease-to-Own Breach of Contract: Questionable and Unethical Behavior by GoDaddy Aftermarket

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Bobby JL Jones

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Disclaimer: This post was drafted with the assistance of ChatGPT to help organize and clearly present the facts. The situation described is 100% real and reflects my current experience navigating a contractual dispute with GoDaddy.
Any feedback, positive or otherwise, is truly appreciated and will be respectfully considered as this matter moves forward.



I’m sharing this to warn others about a serious breach of contract involving GoDaddy’s Lease-to-Own program.

Background

  • I entered into a Lease-to-Own agreement through GoDaddy, with a total purchase price of $1,995 split over 18 monthly payments.
  • I had already made 7 successful payments, on time and in full.
  • The contract clearly stated a 12-day grace period beyond the monthly due date before repossession or termination would occur.
What Happened
  • My credit card expired, and while I was waiting for a replacement, I proactively contacted GoDaddy via chat on May 18, confirming I still had time to pay.
  • Their representative explicitly told me I had until May 20 to make the payment and retain the domain.
  • On May 20, I attempted to make the payment — but the domain had already been removed from my account, despite this being the same day of the month my previous payment had successfully drafted.
GoDaddy then returned the domain to the seller — effectively nullifying 7 months of payments and violating the terms of our agreement.

GoDaddy’s Role

  • Acknowledged that I contacted them within the grace period, yet still failed to uphold the lease terms.
  • Took no meaningful steps to protect me, despite being the platform processing the payments and enabling the agreement.
  • Failed to hold the seller accountable, effectively siding with the party that violated the spirit (and likely the letter) of the agreement.
Why This Matters

This situation exposes a deep vulnerability in GoDaddy’s Lease-to-Own system:
  • There is no meaningful buyer protection, even when you follow the rules.
  • Sellers can reclaim domains and reprice them astronomically without recourse.
  • GoDaddy’s platform gives you the illusion of security, but offers zero enforcement when something goes wrong.
What I’m Doing
  • I am evaluating legal action for breach of contract and damages.
  • And I’m sharing this publicly so others don’t fall into the same trap.
  • After 11 years with GoDaddy & hundreds of thousands of dollars transacted with them, I have moved all ~3,300 domains to a new provider. GoDaddy’s price gouging & unethical practices have become out of hand the past 12-24 months, IMO.
If you’re considering GoDaddy’s Lease to Own service, there is no guarantee your investment, whether financial or strategic, will be protected.

If you’ve had a similar experience or have advice, I’d appreciate hearing from you.
 
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The views expressed on this page by users and staff are their own, not those of NamePros.
Thanks for sharing.

I'll tag @GoDaddy as well.
 
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Did GoDaddy actually say this (bold for emphasis), and do you have a record of it (voicemail, email)?

"Acknowledged that I contacted them within the grace period, yet still failed to uphold the lease terms."
 
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Did GoDaddy actually say this (bold for emphasis), and do you have a record of it (voicemail, email)?

"Acknowledged that I contacted them within the grace period, yet still failed to uphold the lease terms."
Absolutely- I have email correspondence with GoDaddyTA explicitly confirming these facts.
 
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Godaddy sucks.... I wonder why anybody would buy domains from them....
 
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Did GoDaddy actually say this (bold for emphasis), and do you have a record of it (voicemail, email)?

"Acknowledged that I contacted them within the grace period, yet still failed to uphold the lease terms."
IMG_1062.jpeg
 
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I don't get the point making 22 month LTO for 2K domain. It's too risky.
 
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I don't get the point making 22 month LTO for 2K domain. It's too risky.
I think I originally misunderstood your comment - after reading again, it seems to me that you’re saying you don’t get the point in someone buying a $2k domain for 22 months LTO. My reason is quite simple - I’d rather spend all the capital I have on developing the brand/platform bc I can secure the domain for a fraction of the full price. Then, once the additional funds are in my budget I pay it off early. It allows for ppl without access to much upfront capital to secure a good domain name for a business that they otherwise might not be able to afford - or in my case, it frees up extra capital to use towards something like a $2k branding package, for example.
 
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On May 20, I attempted to make the payment — but the domain had already been removed from my account,
Hi

how did you get possession of the domain, before the balance was paid in full?

imo...
 
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Hi

how did you get possession of the domain, before the balance was paid in full?

imo...
With Lease to own, the buyer is provided access to the domain after the first payment is made.
 
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  • The contract clearly stated a 12-day grace period beyond the monthly due date before repossession or termination would occur.
What Happened
  • My credit card expired, and while I was waiting for a replacement, I proactively contacted GoDaddy via chat on May 18, confirming I still had time to pay.

1. When was the payment due?

2. I'm not familiar with how they implement these things, but are the charges automatically made to the card on file?
 
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I'm a domain newbie, but from my very limited experience, I'd say customer service at GoDaddy is absolutely and completely useless. I contacted them via chat and they gave me false information. I tried again the next day and I don't think the person/bot on the other side understood English. I contacted them via X.com and didn't even get the courtesy of a reply. If I stick with this domain side hustle, I'm going to move to greener pastures.

In any case, I hope you have your chats stored and/or some other proof of what happened, which is gross and unfair and no way to do business.
 
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  • I’ve filed formal complaints with ICANN and the Better Business Bureau.
  • I am evaluating legal action for breach of contract and damages.

ICANN has utterly nothing to do with these sorts of marketplace transactions. The relevant contract with ICANN is the Registrar Accreditation Agreement here: https://www.icann.org/en/contracted-parties/accredited-registrars/registrar-accreditation-agreement . Absent a transaction implicating that agreement, ICANN is not interested.

The BBB is, of course, a private organization that extorts businesses for membership fees in exchange for not publishing bad things about them.

On your second point, have you read the dispute and liability provisions of the contract to which you agreed?
 
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As @jberryhill pointed out, one thing conveniently missing from your post is payment due date. You mentioned that you contacted them on 18th and made payment on 20th, and that previous payment on 20th went through, but what was the contractual due date? 18th? 20th? Or maybe 8th? If you say the contract gives 12 day grace period (which is actually quite generous), then I assume 8th? GD's contractual obligations are to both sides, not just the buyer. I agree that the seller's subsequent actions are scummy, but I'm afraid they're within their rights and your mentioning their name on the forum might not be so right.
 
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breach of contract by you or.... ?
 
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I'm familiar with GoDaddy's Lease To Own product as a buyer. As far as I know, there is no grace period for payment. I think perhaps the OP is confusing the domain name renewal grace period, which applies to traditional domain name renewals. The OP is correct to say that GoDaddy's billing of Lease To Own payments can be inconsistent, i.e: a few days either side of the due date. However, I've never encountered anything more than a few days. Unfortunately, I think the OP is out of luck.

Here are the general GoDaddy legal agreements, which include a mention of a 12 day grace period for renewals:

* https://www.godaddy.com/legal/agreements/universal-terms-of-service-agreement
* https://www.godaddy.com/legal/agreements/additional-renewal-terms

Separately, the Lease To Own (LTO) details are included in this document:

* https://www.godaddy.com/legal/agreements/domain-name-registration-agreement

19. PROVISIONS SPECIFIC TO LEASE TO OWN


The following additional Terms apply with respect to Lease to Own Services (the “LTO Services”) provided by GoDaddy, to you.

(A) Definitions:

  • LTO Domain: a domain name that you purchase from GoDaddy through the Site with an agreement to pay over time.
  • LTO Term: the period agreed between GoDaddy and Buyer during which Buyer will have access to the DNS and will make monthly payments to GoDaddy.
  • Service Fee: fee owed by Buyer to GoDaddy for the Services provided by GoDaddy during the LTO Term, including, but not limited to, renewing the LTO Domain, providing administrative services related to the management of the LTO Domain, forwarding correspondence, etc.




(B) Description of Services.

The LTO Services are provided to facilitate the buying and selling of currently registered domain names through payments over time, and not the purchase or sale of associated website content.

As Buyer, you agree to purchase the LTO Domain from GoDaddy. During the LTO Term, GoDaddy will make the DNS for the LTO Domain available to Buyer. You are required to deposit the mutually agreed-upon price and Buyer’s Service Fee, as established by GoDaddy, as soon as practical after you agree to the purchase price, but in no event later than five (5) business days. At no time will Buyer be able to withdraw those funds or send the funds to another recipient unless the initial transaction is cancelled. You agree that GoDaddy is not responsible for breach of contract based upon a failure to transfer the LTO Domain to Buyer after the first payment is deposited. In the event that GoDaddy is unable to make the LTO Domain Name DNS available to Buyer after the first installment payment, GoDaddy shall return any funds provided by buyer for the purchase of the LTO Domain Name as soon as commercially reasonably possible.





(C) Fees and Payment.

You are responsible for paying the monthly payment related to your LTO Domain plus any applicable Service Fee.

Any commissions may be subtracted from the payment, instalment payment or rental payment and, if these payments are not sufficient, from the subsequent payments. In the event that the domain name is purchased in instalments or rented, the commission subtracted will be limited to the secured instalment or rent payment (e.g.: if the commission is 25%, and the instalment price $100, the GoDaddy only subtracts $25 from the payout of the Seller for each instalment.)





(D) Your Additional Obligations.

  1. Buyer agrees to use the LTO Domain only in accordance with any applicable laws and/or regulations, and with all duty and care. For the avoidance of doubt, Buyer is prohibited from using the LTO Domain in a manner (as determined by GoDaddy in its sole and absolute discretion) that:
    1. in breach of any applicable law, statute, or regulation;
    2. is fraudulent, criminal or unlawful;
    3. promotes racism, bigotry, hatred or physical harm of any kind against any group or individual;
    4. infringes or breaches the patent, copyright, trademark, trade secret, right of publicity or other intellectual property) rights of any third party;
    5. contains video, audio photographs, or images of another person without his or her permission (or in the case of a minor, the minor's legal guardian’s permission);
    6. provides information on any illegal activity (including, but not limited to, instructional information on acquiring or fabricating illegal weapons or drugs, privacy violations or distributing computer viruses);
    7. publicizes or promotes commercial activities an/or sales without our prior written consent such as contests, sweepstakes, barter, advertising, and pyramid schemes; or
    8. involves the use, delivery or transmission of any viruses, harmful code, unsolicited emails, Trojan horses or any other computer programming routines that are intended to disrupt, damage, detrimentally interfere with, surreptitiously intercept or expropriate any system, data or personal information.
  2. Buyer acknowledges and agrees not to engage in any activity with the LTO Domain or using the LTO Services that would decrease the value of the LTO Domain. Such activities include, but are not limited to, the use of aggressive SEO strategies, techniques and tactics that focus only on search engines and not a human audience, and usually does not obey search engines guidelines (black hat SEO), such as keyword stuffing, invisible text, doorway pages, adding unrelated keywords to the page content or page swapping (changing the webpage entirely after it has been ranked by search engines), and the use of the domain name for spam activities.
  3. Buyer may not grant any third party any rights to the LTO Domain, including any right to use the LTO Domain.
  4. Buyer agrees to protect, defend, indemnity and hold harmless GoDaddy and its officers, directors, employees, agents and third party service providers from and against any and all claims, demands, costs, expenses, losses liabilities and damages of every kind and nature (including, without limitation, reasonable attorneys’ fees) imposed upon or incurred by GoDaddy directly or indirectly arising from (i) your use of the LTO Services; (ii) your violation(s) of any provision of this Agreement; and/or (iii) your violation of any third party right, including without limitation any intellectual property or other proprietary right. This indemnification obligation shall survive any termination or expiration of this Agreement or your use of the LTO Services.




E. GoDaddy’s Rights.

  1. GoDaddy may terminate your use of the LTO Services for any violation or breach of any of the terms of this Agreement by you. Any such termination will not entitle you to any refund of payments already made to GoDaddy for any LTO Services or Service Fee, and you will lose any and all access to the applicable LTO Domain.
  2. If the LTO Services are terminated, GoDaddy reserves the right to sell the LTO Domain to any party, including potential competitors of Buyer. GoDaddy shall have no ongoing obligation to Buyer related to the LTO Domain.
  3. The parties acknowledge and agree that the GoDaddy is not a payment provider and that GoDaddy does not make any warranties in that respect. In order to effectuate the transfer of payments, GoDaddy uses the services of a third party payment provider. The terms and conditions of the third party payment provider shall apply to such payments.




F. Remedies and Right to Cancel.

Without limiting any other remedies available to GoDaddy, if:

  1. You breach this Agreement, or any document incorporated by reference;
  2. GoDaddy determines your actions may pose a risk to GoDaddy or its members;
  3. GoDaddy determines your use of the Services infringes on the intellectual property or legal rights of others.
GoDaddy may immediately:

  1. Warn its members of your actions;
  2. Place a hold on any pending transactions associated with your account(s);
  3. Limit funding sources and payments;
  4. Limit your access to your account(s) or to any functionality of your account(s); or
  5. Indefinitely suspend or close your account(s) and refuse to provide our Services to you.


In addition, GoDaddy reserves the right to hold funds beyond normal distribution periods for transactions it deems suspicious or for account(s) conducting high transaction volumes to ensure integrity of the funds. If GoDaddy closes your account(s), GoDaddy will provide notice and pay you all of the unrestricted funds in your account(s) due to you.
 
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[edit: my question concerning the seller's identity removed in case the OP follows the excellent advice of @Gabriel360]

It's possible that the seller only knows that the buyer defaulted and then they raised the price just because the domain already sold once (I would do that too, especially if I felt that I previously undersold it). At least you haven't given us any reason (such as correspondence) as to why the seller would know anything about your situation or the stuff that you've told GoDaddy.
 
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Sorry about your experience.

If your explanation is correct, you do not have a problem with the domain seller. You have a problem with GoDaddy.

The seller did not explicitly do anything wrong. Only GoDaddy seems to be the problem.

Plus, you give GoDaddy too much credit to assume that they communicated your information about investing $20k into the development to the domain seller.

Domainers had to beg just to see the country of the prospective buyer they are chatting with. Rest assured, GoDaddy never divulged that info to the seller.

GoDaddy is for people who never need support. You cannot rely on them to be there when you need them.

My advice:

Remove the seller's identity from this post and try to work something out. Maybe an equity deal if you absolutely need the domain name.

And I don't need to say this but consider using an alternative platform than GoDaddy in the future.
 
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