PayPal Friends & Family listings. Why is this becoming so common?

I've done about six deals on U.S. Audiomart.  All but one was F&F.  The one that wasn't was a dealer listing.  I would never do F&F unless a seller had excellent feedback or if the dollar amount was small.  A few sellers were willing to do standard PayPal goods and services if I paid the 3% PayPal fee. 

I see the same thing on Gunbroker.  Many sellers add 3% if you pay with a credit card.

As has been mentioned, between the potential IRS involvement and scammers, it is worrisome.

ozzy

My last listing a few weeks ago on Audiomart was F&F at the request of the buyer. Honestly, I didn't see a downside for me (Seller). I'm not a dealer and things I sell are always at a huge loss so I wouldn't get taxed anyway. It's just more paperwork for me on my side when I file my taxes. If I was the buyer this would be a very different situation for me. I would have to really know and trust someone to do that.

I have had some scammers beg me to let them use regular PayPal when buying from me. The seller takes all the risk. If you want hard guarantees, buy from a dealer. I have made numerous purchases using F&F with no problems. Do your homework, ask the right questions and speak to the seller on the phone for significant purchases. 

“It seems like buyers demand around a 20% discount to take on the added risk of F&F. ”

I have not experienced that at all…my last 12 transactions on USAM, all F&F ranging between $16K - $150. I have sold items within 95% of my asking price. If a buyer wants protection, they can fork out 4% PayPal fee. IRS is a non-issue as you seldom make any profit when you reselling an item.

As far Trust goes, it’s a two way street. You need to do your due diligence in every transaction (feedback and pay close attention to how they are communicating), there are lot of good people out there.

BTW, PayPal protection is worthless! I never relied on them to do right by seller or buyer.