please remember that I only hold BTC in each transaction.
This puts the escrow agent in a harder position - did the seller send a box of rocks or is the buyer lying? Did the item get stolen off a porch when it was delivered? Since money-only escrow is to ensure the potential-scam seller doesn't get undisputable Bitcoins until the purchased item is received, it still leaves open the possibility of claims from an unscrupulous buyer that they didn't get the purchased items, either to get a refund or to just deny payment, or for the seller to ship a box-o-crap and claim the buyer is lying about getting crap.
Here's something I typed up previously describing full escrow, where the escrow agent only forwards on the transaction after seeing both the payment and the item are legit:
Consider these escrow conditions, these would be mine:
1. Bitcoins come first; you won't be sending a package until I confirm payment is secure. The payment address wallet/keys will be backed up the wazoo, with a paper copy of the address keys and transaction info for my next of kin to discover.
2. escrow agent -> buyer shipping cost comes out of the Bitcoins, I'll calculate for you pessimistically @ today's MtGox if I know the box weight, dimensions, and destination ZIP.
3. The singles (or any other item) must be shipped to me with signature service so you can prove to yourself I got them (this based on my experience of eBaying hundreds of items, this is to prevent shipping services leaving stealable packages at the door instead of hand-delivering to a person, or marking them "delivered" when nothing was delivered, it was delivered to the wrong address, or it was stolen by the delivery driver). The items must be double-boxed, over-packaged, and well padded, so it arrives safely and so I don't have to re-box it to meet insurance requirements.
4. If the package is lost or damaged getting to me, you must have insured the parcel yourself and claim the loss yourself. I will refund the Bitcoins if I do not receive the package or if the package contents are not as described or damaged (after waiting around a month to ensure the package was not misplaced or delayed in shipping).
5. I will re-ship FedEx insured with adult signature confirmation to a physical address only. No post-office box services either (I will Google, seller should check address also).
6. Carrier signature-proof-of-delivery will be proof I completed escrow service. When it is delivered with signature, the transaction will be final and I will send Bitcoins. There will be no claims the package wasn't received if it was delivered and signed for.
7. If the package is lost getting from me to the buyer, I will pay out the Bitcoins to the seller after a similar waiting period to be sure it's lost for good and that the shipper acknowledges the loss and insurance will cover it. I will compensate TO THE BUYER only what I am able to get from insurance (all shipping companies have insurance adjusters that are dicks and routinely deny claims you have to then appeal, will only pay "replacement cost" regardless how much insurance you buy, etc).
8. If the package is damaged getting from me to the buyer, I will compensate TO THE BUYER what insurance pays out (see above) as a replacement or repair settlement. Buyer must cooperate with insurance adjuster's package inspections and/or pick-up of damaged packaging and any or all shipped merchandise, etc.
I think I've thought out every escrow scenario here. Anyone considering doing escrow services should examine the above too, so a buyer and seller know the score when it all goes wrong. 6, 7, and 8 seem like the best terms for fairness and to protect seller and escrow agent against unscrupulous buyer claims.
