Buyer wants to cancel

I though bidding for an item was binding.

the winning bidder for an item i am selling has requested the purchase canceled as she made a bid by mistake!

is this allowed?

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It's against the rules, but in reality no one can force her to buy.  You don't say whether she paid or not.

 

If not, you can complete an unpaid item dispute to get your selling fee refunded and she will get a strike.  If she has paid you can send the item, but in either case ytou can still lose out.  if you force her to receive an item she doesn't want she could find an imaginary fault with it and then you would not only be forced to refund, but also to pay for the return postage.

 

Cancel choosing the option  " the buyer asked to cancel".  This will get your selling fee refunded, and will not harm your account.  If she's paid, refund AFTER the cancellation.  If you do it first you will give yourself a defect.

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