Paypal....protection for sellers?

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Posted By: Dave

I know we've been through the Paypal thread before. But I do have a question I haven't found a link to in the search engine. Say your selling a card and it goes for $1,500. The buyer paypals you the money. You send the card out maybe two days later...you send it insured, signature confirmation as well. Then you get an email two or three weeks later from paypal saying the buyer "had" insufficeint funds and that your money you were sent is now under investigation and liable to be taken away.

First, what is the likelihood of this? Second...if the $1,500 dollars he sent you has since been moved over to your actual checking account, can Paypal have the money instantly taking from your checking account if the funds aren't in your paypal account at the time? Third, if Paypal can instantly withdraw that money from your checking providing the funds aren't in your paypal account, do you have any action you can take with your personal bank to stop the money transfer to paypal?

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Posted By: mark

As far as i know Paypal CAN NOT take the money out of your personal checking but can take it out of your Paypal account.
That is why never leave a large balance in paypal.

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Posted By: Marty Ogelvie

Scary scenerio. I have heard horror stories of sellers having Paypal come back and withdraw funds that were paid via a bogus credit card, etc. I have always been told to remove any paypal funds immediately to keep paypal from withdrawing those funds at their discretion. If paypal has access to your checking acct. then the above option would be fruitless.

martyOgelvie
nyyankeecards.com

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Posted By: Dave

Something else you could do to "protect" yourself would be to do what I have done. When someone pays through Paypal, I remove the money and put it into my checking account that I set up strictly for Paypal before I send the item. I then transfer the money to a savings account I have set up at the same bank so there is nothing for Paypal to withdraw even if they have the right to take the money out of my checking account. It sounds like a lot of work, but I do it all online and it takes no time at all.

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Posted By: davidcycleback

I assume when you get paid through PayPal and it registers in your account as positive $$, you are receiving money that exists. There isn't a proverbial check that later bounces. There are cases when money is pending, but you are notified that the money has yet to clear and notified when it has cleared. For example, if you transfer money to your account from you bank, it takes a few days then PayPal adds the $$ to your total. Until then, the money is listed as in the process of being transferred and not added to your account total. In other words, PayPal doesn't tally proverbial money or theoretical money, but money they've verified as existing.

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Posted By: barrysloate

If you have no money in your paypal account, and then buy something using paypal, won't it get billed to your credit card? And that being the case, if someone has a dispute with you and paypal sides with them, can't they still debit your credit card until the matter is resolved?

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Posted By: George Dreher

I know someone who received money through PayPal and moved it to their checking account. The buyer initiated a chargeback and when an insufficient balance was found in the PayPal account, they drained their checking account. That happened in 2001.

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Posted By: Eric B

Most of you have a bank account linked to your Paypal account. If there is not enough money in your Paypal account they can take it from your bank account. Why can they do that? Because you agreed to it when you signed up,whether you actually read the agreement is immaterial.

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Posted By: jay behrens

If you really feel the need to take Paypal as a seller then you need to do 2 things:

1: Open up a new checking account dedicated to Paypal. When you get moey in your Paypal account, drain into your new checking account.

2: Open up a new savings account or use your existing checking account. When you get money in your new checking account, IMMEDIATELY transfer the money out of the new checking account. This will keep PayPal from getting access to it.

If you are a buyer, PayPal is great. If you are a seller, it sucks royal arse. I convience of getting paid right away isn't worth the nightmare you set yourself up for. It's not like we sell impulse purchase items. Our little carboard babies are something that people plan to buy and set aside money for them. Paypal is only good for catching impulse buys and there are so few in our segment of the hobby.

Jay

I love pinatas. You get to beat the crap of something and get rewarded with candy.

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Posted By: peter chao

Jay,

You don't consider auction purchases an impulse buy. People may be thinking strategically as to the value of the card and what they are willing to bid but I've seen people overbid their budgets. Let's say that instead of buying cards by auction you were buying a kitchen table by auction. Now I might agree that it would probably not be an impulse buy.

Peter

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Posted By: jay behrens

Even if they overbid, it's still not an impulse buy. Money is already set aside for the card and it is highly unlikely that the overbid is really going to be that significant.

Jay

I love pinatas. You get to beat the crap of something and get rewarded with candy.