guitargoddsjm
macrumors 6502
I would file the dispute as soon as possible as the seller may try to remove all funds from their paypal account in the hopes of not returning your money.
It doesn't matter if he removes funds or not. If Paypal sides with the buyer, they will actually remove money from the seller's account. I don't remember if they can pull money back from a bank account, but I'm pretty sure if he has negative funds, Paypal usually calls a collection agency to get the money.
It's scary for sellers (especially since people have been scamming sellers lately), but it's there to protect buyers. In situations like this, it's an effective method of doing that.