I just had someone email me asking how much it would cost for a paid post with a link? It would be 300 words and provide a link to his website. Is this common and what's it called?
It's called buying a link and it's a great way to hurt your website. Google very much frowns upon this as it is done solely to manipulate their search results. Sites that sell links and do not use nofollow on them, which is assumed since they paying for a link that has SEO value, are punished by Google and deservedly so.
If you are going to do this make it very clear to the buyer that the link with be nofollow and on the page with the article you should state that the post was paid for (aka an advertisment).