I just did a handshake deal with a guy on US Audio Mart. The deal involves a decent amount of money. He has a few buys and sells in the past few months with excellent customer ratings. I can even see when he bought the stuff that I am now buying from him. Is PayPal Friends and Family a scamming type thing, or just a way to avoid fees, etc.? I want to trust this guy because he has what I want and the price is very good. However, I want to understand what I'm getting into with PayPal Friends and Family. Do you think I should offer a higher price if we can do it where paypal guarantees the deal?
It's risky if you do F&F. If you want to eliminate that risk, do regular PayPal and add 3 percent to cover the seller's hit. Keep in mind that a seller requesting that you do this is against PayPal's policies, though I'm not sure what if any consequences there are.
You raised your own red flag when you said "I want to trust this guy because he has what I want and the price is good." Famous last words. If the price is that good, offer to pay the 3% extra to cover his PayPal fees for a normal transaction. If he declines, walk away. On the other hand, what's your buyer feedback like? Sellers have been burned by PayPal automatically siding with buyers even when the buyer just basically says, yeah, changed my mind. Nuisance buyers basically spoiled by an Amazon buying mentality are a real pain for the honest seller. Cheers, Robert
I think it is mainly the change in tax law that is driving it, most sellers want to use F&F now to avoid the sales being reported to IRS.
It's done to avoid IRS reporting. If the deal falls thru you have no recourse (at least thru PayPal). The add 3% suggestion is a good one. Unfortunately this is a contractual business transaction. Trust is not a part of it ino. You do not know him.
F&F isn't for me. I'd do F&F if I can see it, pick it up, and leave with the item at the same time as payment. Otherwise, I'd only do F&F up to an amount that I'd be good with losing. And I'm not good with losing. This stupid tax change has limited me to only look at gear within driving distance or from dealers remotely that will take credit cards.
You have to ask for F&F as a seller or you will get a 1099 from PayPal if sale is $600 . Even if it is not income which it probably is not. You will then have to report it on your tax return as erroneous personal income or ignore it and see if the IRS catches your failure to report it. This is new this year. Asking for F&F does not mean a scam now. The Music Room pays you using F&F if you sell equipment to them. You will not have PayPal protection as a buyer.
After the new IRS regs for electronic payment I'm strictly old school - postal money order or cashiers check only.
I got burned purchasing equipment on this site twice, but luckily one of those times I used PayPal goods & services option so recovered my $. No way will I do friends & family as it’s 100% risky.
Unless it truly is a family member or friend, think, "Danger, Will Robinson! Danger!!!" Any seller who suggested using F&F would result in my shopping elsewhere.
Friends & Family saves the seller a few percent and makes it so you can't later appeal the payment. I wouldn't give up the right to appeal to save the seller 3%. I'd never ask a buyer to do that, either.
Or Amazon Gift Certificate if you use Amazon a lot. They buy Amazon GC, you cash it and put it in your account. Deal done. But buyer gets no recourse if deal goes south.
