I am hating paypal more and more. So I sold this phone on ebay a while back, guy pays with paypal, then says the thing doesn't work and wants a refund. Problem is he won't send the phone back, so I won't give him a refund. He files a complaint with paypal, for some reason they take his side and decide he deserves a partial refund. This was 6 weeks ago. Well today I get a letter in the mail from a collection agency on behalf of paypal for the money!!! I didn't have any money in paypal when the decided for him, so they couldn't take any money from me. What the hell do I do? I am buying another house next month, and have spotless credit so I don't want to have to pay him just to get the home loan, and the paypal account was in my old name anyways from before I got married. (long story, and no I didn't take her name, we made a new one) Can they come after me for this? I always thought in order for someone to collect from you you had to apply for credit and not pay or have a court order you to pay, like a traffic ticket or a judgement.