Consumers have the right to dispute credit card charges due to fraud, billing errors, and bad service or service not rendered. Fraudulent charges have no time limit for disputes, but you must make any disputes for the other two types of charges within 60 days.
How to Dispute Credit Card Charges
- Fraudulent Charges: Contact your credit card’s issuer and ask them to remove the charges and issue you a new card.
- Billing Errors: Contact the merchant first and ask them to fix the error, then send a dispute letter to your credit card’s issuer if needed. You may also be able to dispute the charge through your online account.
- Bad Service/Service Not Rendered: Contact the merchant first and ask for a refund or replacement, then send a dispute letter to your credit card’s issuer if needed. You may also be able to dispute the charge through your online account.
What Types of Credit Card Charges Can You Dispute?
- Purchases made as a result of unauthorized access to your credit card account
- Getting billed twice for a single purchase
- Being charged the wrong amount
- Failure to credit a return
- Items that are either not delivered or are sent to the wrong address
- Items that were damaged in transit
- Services not provided as originally specified
It’s important to note, however, that you can’t simply leverage the credit billing dispute process to avoid paying for purchases that you indeed made and received but simply don’t want to pay for. Credit card companies investigate disputed charges, and while they may give you the benefit of the doubt for a minor charge the first time you complain, they won’t be so lenient with big-ticket purchases or with subsequent complaints. You’ve heard the one about the boy who cried wolf, right?
How to Dispute Fraudulent Credit Card Charges
Disputing a fraudulent charge on your credit card statement is relatively simple. You just need to contact your card’s issuer and they will remove the charge, block your old card from being used and issue you a new card.
Steps to Dispute Fraudulent Credit Card Charges
- Contact your issuer’s customer service immediately.
- Tell the customer service representative that you did not make the purchase.
- Wait for the issuer to remove the fraudulent transaction from your account.
- Activate the new credit card the issuer sends you and cut up the old card.
Key Things to Know About Disputing Fraudulent Charges
- What Qualifies: A fraudulent charge is any charge made due to unauthorized access to your credit card account.
- Rule Yourself Out First: Before you file a dispute, you should make absolutely sure that the charge wasn’t from you or an authorized user.
- See If the Merchant Made a Mistake: If the purchase is from a merchant you did business with before, it may simply be a mistake. You might be able to get the charge removed by calling the merchant.
- Legal Liability Limit: You cannot legally be held liable for more than $50 in unauthorized charges.
- Card Liability Protection: Nearly all credit cards offer $0 liability guarantees for fraudulent purchases.
- Police Report: It’s a good idea to file a police report about the unauthorized charge so it can be investigated, but this is not required.
How to Dispute Credit Card Billing Errors
If you made a legitimate purchase but the merchant made a mistake, such as billing you twice or charging you the wrong amount, the first step you can take is contacting the merchant. If the merchant will not correct their error, then you will need to go through your credit card issuer instead.
Steps to Dispute Credit Card Billing Errors
- Contact the merchant and ask them to fix the error. If this succeeds, you don’t need to take further action.
- Submit a dispute in writing to your credit card issuer’s “billing inquiries” department if the merchant refuses to fix the error.
- Wait for your card’s issuer to investigate the situation and make a judgment. If they rule in your favor, the disputed charge will be removed and you don’t need to take any further action.
- Decide whether or not to accept your issuer’s decision if they do not rule in your favor. You can accept the charge and pay it, or you can write back to the issuer within 10 days saying you refuse to pay the charge.
- Escalate the situation to the Federal Trade Commission or Consumer Financial Protection Bureau if the issuer does not rule in your favor and you choose not to accept their decision.
Key Things to Know About Disputing Billing Errors
- What Qualifies: Credit card billing errors include getting billed twice for a single purchase, getting charged the wrong amount, or a failure to credit a returned purchase.
- Dispute Time Limit: Your dispute letter must reach your card’s issuer within 60 days after the first bill with the error on it was sent to you. You might also be able to initiate a dispute through your online account, but the FTC recommends sending a letter instead.
- Example Letter: You should use the template letter from the FTC to ensure you have all the necessary information. You should also mail any proof that supports your position, such as receipts and payment records.
- How to Mail Your Letter: You should send your letter by certified mail with a return receipt, and keep copies of the letter and all supplemental proof you send.
- Resolution Time Limit: The issuer legally has 30 days to acknowledge your dispute in writing and then resolve your dispute within 2 billing cycles of getting the letter. If they do not, they cannot collect any money for the charges, even if they end up being correct.
- Collections Possibility: If the issuer finds you liable for the charge and you refuse to pay it, they will then be able to begin collection procedures. They may report you as delinquent to the credit bureaus, though they might include a note that you disagree with the charge.
- Warning About Payments: You should NOT pay any of the disputed charges while they are under investigation.
To sum things up, you should go through the merchant first, then your credit card issuer. But if both of those are of little help, you can file complaints with the Consumer Financial Protection Bureau – the financial industry’s main regulatory body – and/or the Federal Trade Commission, which is charged with enforcing the Fair Credit Billing Act. You can even sue your credit card issuer for a violation of the FCBA, if necessary, but it hardly ever comes to that.
How to Dispute a Credit Card Charge for Bad Service/Service Not Rendered
Sometimes, a charge on your credit card bill may be technically correct but you either didn’t receive the product or service you paid for or received something unsatisfactory. In this case, you should first contact the seller and ask them to resolve the issue, and if they do not, you will then need to contact your credit card issuer.
Steps to Dispute a Credit Card Charge for Bad Service/Service Not Rendered
- Send the merchant a letter based on the Federal Trade Commission’s sample customer complaint letter. This will allow you to explain your problem to the merchant and ask for a refund or replacement. If this succeeds, you do not need to take any further action.
- Contact your credit card issuer if the merchant won’t fix the problem.
- Wait for your issuer’s investigation and decision.
- Decide whether or not to accept your issuer’s decision if they do not rule in your favor. You can accept the charge and pay it, or you can write back to the issuer within 10 days saying you refuse to pay the charge.
- Escalate the situation to the Federal Trade Commission or Consumer Financial Protection Bureau if the issuer does not rule in your favor and you choose not to accept their decision. As a last resort, you can also choose to sue the issuer.
Key Things to Know About Disputing Bad Service/Service Not Rendered
- What Qualifies: Reasons for claims can include items that are either not delivered or sent to the wrong address, items that were damaged in transit, or services not provided as originally specified.
- Eligible Transactions: In order to file a dispute with your issuer, the transaction must be for at least $50 and it must be made in your home state or within 100 miles of your billing address.
- Proof Needed: You must have proof that you tried to resolve the situation with the merchant before contacting your issuer.
- Dispute Time Limit: Your dispute letter must reach your card’s issuer within 60 days after the first bill with the error on it was sent to you. You might also be able to initiate a dispute through your online account, but the FTC recommends sending a letter instead.
- How to Mail Your Letter: You should send your letter by certified mail with a return receipt, and keep copies of the letter and all supplemental proof you send.
- Resolution Time Limit: The issuer legally has 30 days to acknowledge your dispute in writing and 2 billing cycles to resolve your dispute, after getting the letter. If they do not, they cannot collect any money for the charges, even if they end up being correct.
- Warning About Payments: You should NOT pay any of the disputed charges while they are under investigation.
Final Thoughts
It’s not uncommon for merchants and credit card companies to make billing mistakes, and you have the right to dispute them. The ability to dispute credit card charges derives from the Fair Credit Billing Act of 1975 (FCBA), which was passed as an amendment to the Truth in Lending Act and specifies what charges are disputable, how the dispute process works, and the rights that consumers, merchants, and financial institutions have throughout.
At the end of the day, given the fact that all major credit card issuers provide $0 fraud liability guarantees to their customers and wish to promote credit card use without fear of the costly mistakes it can trigger, most dispute cases will be resolved in the consumer’s favor, as long as they are legitimate.