Refund Confusion

[iSellularr]

On eBay, I sold an item for £90. When i recieved the money, I transferred it straight into my bank. 

The buyer wants a refund, so they have sent the item back, but I haven't issued a refund yet, but I am in debt/negative numbers of the amount I sold the item for. The money is still in my bank, and I still haven't issued the refund yet, so i'm confused as to why i'm in negative numbers on paypal.

Thanks

[sharpiemarker · Accepted solution]

@iSellularr 

Because, once a PayPal dispute is filed, PayPal withholds the amount in dispute so you'll need to add it back to zero out your balance and upon outcome of dispute, you may get it back. This is why PayPal institutes the 21 days funds availability hold, people withdraw too quick thinking this money can't be get at, but oh no, not so fast bubba.

And do not issue a refund on your own or outside of the dispute, once you have zero'd out the balance. Issue refund within the dispute in the Resolution Center or if the dispute is escalated to a claim, PayPal will decide who gets the money. Just add the funds back into your PayPal balance to zero out your balance only.