Paypal works fine when everything goes great, but it's a REAL PITA when you want to make a claim, or worse, when the guy you sold it too makes a claim on you - Paypal just freezes those funds, and often your entire account. Try and get a real person on the phone - not! Also, watch out for E-checks (don't take them or wait for them to clear). If the guys bank backs out a few days after you ship, you're screwed. If Paypal wants money from you for a claim, and even if you disagree, they reach back into your back account and take it, then argue. Remember that bank account and all that fine print you didn't read when you when you signed up?
My advise:
1) Don't give paypal access to your entire bank account. Set up another savings account, put minimal funds in it, and use that one.
2) Use your credit card to pay for purchases. Paypal HATES it ('cos they make almost nothing on the transaction), and makes you jump though a couple of hoops to use it, but if you have a problem with a purchase, call your credit card company and wham, paypal is debited and your credited until the charge is resolved at the credit card company end. And, remove your cash balance back to your minimal back account before paying with a credit card, 'cos paypal will use it first, then the balance to the card.
