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How To Dispute Credit Card Charges Under the Fair Credit Billing Act

Correcting billing errors on credit card, private label card, and other revolving credit accounts takes some patience and familiarity with the dispute settlement rules provided in a Federal Law called the Fair Credit Billing Act (FCBA).

Here’s how you dispute a credit card charge (also known as a “chargeback”):

First, make sure the charge is a type of charge covered by the FCBA: 

  • Unauthorized charges (Federal law limits your responsibility for unauthorized charges to $50);
  • Charges that list the wrong date or amount;
  • Charges for goods and services you didn’t accept or weren’t delivered as agreed;
  • Math errors;
  • Failure to post payments and other credits, such as returns;
  • Failure to send bills to your current address (so long as you provided the creditor with a written change of address, at least 20 days before the billing period ends;
  • Charges for which you ask for an explanation or written proof of purchase along with a claimed error or request for clarification.

Next, to dispute a charge, you need to:

  • Write to the creditor (bank) at the address given for “Billing Inquires”, do not write or send to the address where your payment is made. Include your name, address, account number and a brief description of the billing error or problem.
  • Send your letter by registered mail. You will then have proof the letter was sent on a specific date. Send copies of any supporting documents, receipts, etc. (not originals). Keep a copy of the entire document sent. 

*Important!—You need to make sure your letter reaches the creditor within sixty (60) days after the bill containing the error or contested charge. The creditor must acknowledge your dispute, in writing, within thirty (30) days of receipt unless the dispute has been resolved. The creditor is bound to resolve the dispute within two (2) billing cycles (but not longer than 90 days) after receiving your letter.

In some situations, you may be able to dispute a charge online (at your bank’s website).  Check your banks website to see if they have this feature (it is a great time saver).

Here’s what you should expect if you take the steps above (and the dispute is valid).  By law (under the FCBA), the credit card company must credit your payment to your account the same day it is received. If a credit card company is found to have not done so, in addition to being subject to fines by auditing authorities, it cannot charge you interest for the period in question nor can it assess you late fees or additional charges. 

Don’t pay for fraudulent charges or billing errors!  Make sure to check your statement regularly, and act quickly to fix any errors.  Your credit score will thank you!

 

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