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I had the same problem when I got my phone.
I took it back to the store and they sent it in for service - got it back 2 weeks later, still with the same problem (but with a new Android version installed :smileyconfused:). Another 2 weeks in the shop, and I got it back - this time working as it should. I don't know what they did, but they fixed something.
Soooo..... I'd say this is a "common" problem that the Sony Ericsson service people need to fix.
Good luck!
There is nothing more you can do at home. Being a bit of a sceptic... perhaps it was an issue with the phone that caused the original owner to sell. It may be worth going back to them with a query about it, not sure on the terms on Ebay as I have never bought electrical stuff on there.
You could contact the SE service centre in your region and ask for an estimate on repair. List of phone numbers for you....
http://www.sonyericsson.com/cws/corporate/common/contact/phonelist
The only other thing is to use it with a head set as previously suggested.
Sorry that I couldn't assist more.