How to Dispute a PayPal Transaction

Disputing a PayPal transaction is the first step in the claims process if you have a problem with a purchase you paid for with the service. PayPal offers buyer's protection on purchases if you do not receive the item, or the item you receive is not the same as the seller described it. 

 1. Contact the seller of the product or service you paid for to try to resolve the problem directly before involving PayPal. You have 45 days from the date your payment was sent to start the PayPal dispute process. 

2. If time allows, contact the merchant directly as a good faith gesture. The seller may provide a quick and easy resolution. For instance, she may be able to email you a shipping tracking number to locate your purchase, or offer to exchange the item or refund your money if you received an item that was different from the one you purchased. If the seller does not resolve the issue to your satisfaction or does not respond to your attempts to contact her, dispute the transaction through PayPal. Log into your PayPal account and locate the transaction you are disputing. You will need to know the date of the transaction or the transaction ID that you wish to dispute. 

3. Go to the "Resolution Center," which you can access at the top of your account home page. 

4. Click the button labeled "Dispute a Transaction". 

5. Check the field for "Item Dispute" and then click the "Continue" button. 

6. Type the transaction ID number into the box, then click "Continue." Alternatively, you can use the "Find Transaction ID" if you do not know the transaction ID. 

7. Scroll through your account history to locate the transaction. Change the date range at the top of the page if the transaction does not appear on the first page of your account activity. 

8. Select the transaction after you find it, by clicking on it. Then, click the "Continue" button. 

9. Provide PayPal with information on the problem by filling out the necessary forms to activate the dispute. 

10. Respond to all communications from the seller as requested by PayPal to attempt to resolve the problem. 

11. Close the dispute if the seller resolves the problem to your satisfaction. Be sure you are completely satisfied with the transaction before closing the dispute. Once you choose to close a dispute, you can not reopen it. To close the dispute, choose the option of closing it on the bottom of the dispute details page in the "Resolution Center." 

12. Escalate the dispute to a claim if you are unable to come to an agreement with the seller. Choose the option of escalating the dispute to a claim on the details page in the "Resolution Center." Provide the additional information that PayPal needs to investigate the claim by following the instructions at their website. If you do not escalate the dispute to a claim or close it before 20 days has passed, PayPal with automatically close your dispute. 

13. Monitor the status of your claim under the "Open Cases" section of the "Resolution Center." When you open a dispute at PayPal, they remove the money that you paid the seller from their account and put a hold on the funds. This money is held until the dispute is closed or the claim is resolved. After the case is closed, PayPal will release the money to either the buyer or seller. 

If you come to an agreement with the seller without using the PayPal dispute process, do not allow too much time to pass before the seller makes good on his agreed-upon resolution. Keep in mind the time limit on filing a dispute at PayPal. If the seller puts you off and does not deliver on his promises, he could cause you to miss the deadline for opening your dispute.