GoDaddy reviews : Should I pick GoDaddy?? Chargebacks: let`s talk about them

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Today by trying to find how much my bank charges about some services I accidentally found this about chargebacks:.

I`d love to hear what your bank/credit card policies are since most of us thought that 60 days was the maximun......we better know these details!.


Comments (23)

I just got slammed for $2000 in a charge back, I held the site for 30 days, the customer was happy with that, after 30 days I released ti to him (paypal deal) and then b00m 4 hours later, charge back!.

I email paypal all the proof that this was a legit deal, including ALL documents from buyer / emails messages etc...

What do they do??? ALLOW THE CHARGEBACK so now I'm a site down and $2000 out.

No matter what you do, if you use paypal your F**KED, ive learnt my lesson, BIG TIME.

I can laugh about it now because pay back is a bitch, and unknown to me, I had accidently left a passage into the code, which I duely exploited daily...

Comment #1

Unless it is a person you have known for quite a while, Always use an escrow service for $1000+ transactions.

If it is less than $1000 , Tell them they must use a PayPal balance to pay you. The problem is non tangible goods, PayPal considers electronic transfers of goods, non tangible. It is a he said-he said case, with out any real proof, In these cases the buyer most always wins with PayPal...

Comment #2

If I were you I would start taking legal proceedings against the individual. This is obviously a calculated move on their part...

Comment #3

Good advice. People somehow think that they can chargeback with impunity. As long as you have proof that you sold them a product or a service you can turn the debt over to a collection agency or file legal proceedings. There is no difference between bouncing a check and filing a chargeback except that people sometimes accidently bounce checks and chargebacks are never an accident.

I run a graphic design company and have people frequently file chargebacks (an occupational hazard), I take chargebacks very seriously and treat them the same way as I would someone stealing from my front lawn.

For $2000 I'd take a cheap plane ride to his state and go knocking on his door. People get alot more honest when they see they are dealing with a real person and not just a name on the internet.

Just my 2 cents...

Comment #4

Eh, you need to be careful here. If you decide to take legal action, it is probably important NOT to open a dispute with paypal about the chargeback. I am not exactly sure what would happen in an actual case but I do know that the paypal TOS state that if you escilate your dispute, you are letting paypal decide the final outcome of the dispute. I am not sure if that means you cant still take it to court but I am sure that if paypal sides with the party doing the chargeback, then that can become evidence in the court case. If the judge decides to overturn paypal's decision then that is up to the judge I guess. Feel free to correct me if I am wrong...

Comment #5

I have actually talked with PayPal about this. According to them you always have the right to puruse the customer in any way you choose. PayPal is just the Payment Processor, nothing more. Letting them decide the "final outcome" is just to keep you from suing them, it has nothing to do with your ability to attempt to get the money from the customer in other ways (BTW, "escalating" and "dispute" are terms used in PayPal "complaints", not chargebacks).

Also, there is a very big difference between a PayPal "dispute" and a "chargeback": in a PayPal "dispute" or "complaint" PayPal is mediating. In a chargeback it is the credit card company that is making the final decision (for the most part).

Just remember that PayPal is just a glorified Credit Card Processor, nothing more, and their decisions don't have very much (if any) legal weight when it comes to someone owing you money...

Comment #6

Paypal have little say over whether a charge back takes place or not. All they can do is present the evidence to the credit card company and if the credit card company sides with the customer then the charge back will occur regardless of paypal's thoughts on the matter.

Of course once that has been done then they will retrieve the money from the sellers account so they themselves are not out of pocket.

If you pursue the matter further I very much doubt a court would take too much notice of the paypal decision once it was pointed out the process a transaction goes through...

Comment #7

I couldnt do anything, I presented my case to his CC company, I showed them the evidence it was a real deal, I showed them the website he bought, I should them all the transactions between us and they said there client hadnt recieved the goods, the website or the domain, I showed them the whois for the domian, in there clients name, I showed them the site, in there clients name, how doesnt he own it?.

They stood by there original desicion based on the fact there client had told them he hired a coder to make the site for him, my problem there was I made him wait 30 days before I gave him the site, in 30 days, in truth it could of been cloned so either way, I lost out.

Bottom line, pay backs a bitch and now he cant stop the rot LOL...

Comment #8

Thanks for that HeyGeek. Thats actually what I was thinking of when chargebacks come into play. Usually the customer's bank that does the chargeback is able to be challenged with evidence. So perhaps instead of disputing paypal about the transaction, your better bet is supplying the evidence to the customer's bank issuing the card to try to overturn the chargeback...

Comment #9

I agree. And PayPal actually does that for you, when a chargeback is issued they request that you (the seller) provide your side of the story, along with any documentation you have. They than review it to see if you have a case, if they feel that you have a case they than forward your information along to the buyers credit card company/bank. I have never had trouble getting them to forward the info to the credit card company.

I recently talked to a PayPal representative about a $500 chargeback I am dealing with, and he said the more information you give them to send the credit card company the better, he said that someone once faxed in over 1500 pages of information, which they then passed on to the credit card company...

Comment #10

I guess we'll have to hold the domains for 120 days before transfer...

Comment #11

And some people complain the initial 60-day transfer restriction is nonsense...

Comment #12

When someone wants to pay you with PayPal for a large purchase simply request that they:.

1. Pay you using Mass Pay. This only costs them $1 and cannot be funded by a credit card..


2. Select "service" as the item they are purchasing.

This is pretty much failproof as they now cannot do a chargeback or issue a PayPal dispute (PayPal always decides in the favor of the seller with a dispute over a service/virtual item (note: DISPUTE not CHARGEBACK), as a seller I have never once lost a dispute over a virtual item or a service.).

Of course you could always just use

Comment #13

What exactly is the difference between a PayPal Dispute and PayPal Chargeback?.

Nice thread Lorenzo. Even if it has kinda gone to a PayPal thread...

Comment #14

What is mass pay, and why cant it not be refunded?..

Comment #15

A dispute it you complaining to PayPal, PayPal then decides the validity of the complaint. A chargeback is you asking your credit card company to take the charge off your statement (and take the money back from PayPal, who then takes it back from the seller). Mass Pay is payment that the sender pays the fees for ($1) instead of the receiver paying a percentage to PayPal. Mass Pay can only be funded by your PayPal balance (no Credit Cards) so there is no way the sender can charge it back. The sender can still open a PayPal Dispute, but as long as the dispute is over INTANGABLE items (websites, domain names, design services etc..) the seller will win every time, as PayPal does not provide dispute resolution for those items...

Comment #16

I was just reading up on mass pay- seems more involved than that- I imagine if it was that easy we would have all been doing it and not paying any paypal fees, no? buyer needs a bussiness acct, needs to have some sort of tab file set up, ect....

Comment #17

It's not that complicated at all: yes the sender does need to have a business account, but the maojority of people that buy and sell domain names and websites do, and the tab file literally takes 10 seconds to set up. I pay a bunch of people that do work for me with it several times a month.

The reason more people don't use it is because it isn't something PayPal actively really is quite easy. And the people that know about it use it all the time. I had someone buy $2700 worth of advertising from me the other month, and I had him use Mass Pay. He had never heard of it before...

Comment #18

Hi X , as far as I know, balance or not balance the problem is still there.

So, thanks to everyone, so far we established that there are 2 ways a payment can be reversed:.

1) chargeback (which was the topic of this thread and I`d love to hear the terms from someone else) and it seems it can be avoided by asking to pay only with PayPal balance if we really really really need to use PayPal.

2) PayPal dispute and it seems that if buyer pay by Mass Pay and choose service , PayPal will protect seller in this scenario. I won`t rely on that, so the other way as someone suggested is to ask to the buyer to open a dispute and then close it before to proceed as it seems a dispute can`t be opened twice for the same transaction.

(still I`d love to hear how long your credit card allows chargebacks......thanks)..

Comment #19

The reason that this is usually safe is because as long as the item purchased was a service PayPal's system automatically closes the dispute when it gets escalated to PayPal management. A real person never even looks at it. PayPal favors the SELLER with intangabile items, credit card companies favor the BUYER.

Also, having buyers constantly open disputes (even if the close them right away) is a good way to get your PP account limited...

Comment #20

Uhmmm true but they limit it anyway....what a service..

Comment #21

Chargebacks can occur up to 6 months in most cases. Read your own credit card agreements to see when you can start one. Amex I think it's even longer..possibly up to a year.

Use escrow for characters with no reputation. I also check reputations of deals to see if they were small petty deals and then suddenly they want to paypal me $800...I get suspicious. I would much rather pass on a deal than to lose my site and get aggravated at being scammed. Err on the side of caution. Backdoors into scripts is also imho a good way to make sure a person stays honest. I have scripts ready to run if some idiot thinks they can take my site and not pay me. They will quickly see what r00ted means...

Comment #22

Be extremely careful with doing that. Although I can understand the sentiment if you do gain root or cause damage to the server you are criminally liable...

Comment #23

This question was taken from a support group/message board and re-posted here so others can learn from it.


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