Depends on where you live. In most cases, chances are not. For higher amount they may send legal notice if you are in a developed country like USA. Where are you from?
they will lock your account first and then send debt collector notice you will need to payup the debt someway by check or bank transfer.
I recommend you to first delete your Credit Card from your Paypal account and then close your paypal account.If you are outside USA,Then you are safe.nothing will happen to you.Make a new Paypal account and start using it Byway,Which country you are from?
They will send bunch of emails to deposit the money. But they will not send any physical mail or legal notice to you for $500 to China. However, remove all credit/debit cards, bank account from your PayPal account as soon as possible before the account being locked. Also add new email address and remove the old one. You may also change address, phone number, personal information too. This will help you to create a new verified PayPal account easily again.
My friend had the same problem he had 1000+ negative balance but his case was different. He found out that the buyer sent via hacked paypal account so he had the negative balance. He never returned the amount to Paypal as it wasnt his mistake. Paypal never called him or tried any legal actions. They just kept mailing him and later stopped. Just relax if you are not wrong then just be calm. If Paypal calls you or takes any legal action (they may just threat you) only after you get proof that they are taking action then only pay them. The above is advised only if you are right at your place. Believe in karma.
your account get locked and more you daily receive mail from paypal to make payment and once blocked you can uses that account for further payment. Till now i dont see any legal issue anyone face
Yoru account will be locked and paypal keep sending you an email , if you are in china you dont have to worry about law
i think US and Canada and UK Australia people may get some legal trouble .but People from other countries. its all fine.