How to Dispute Charges on a Credit Card

March 25th, 2007 • Related • Filed Under • by admin

Have you ever purchased a product only to bring it home and find out that the item you purchased was damaged or extremely poorly? Have you ever been charged more than the price that you agree to for a purchase? Has a child of friend “borrowed” your credit card and bought themselves a few free meals? Have you made a payment on a bill, only to find out that the company you have a loan with forgot to credit your account? These things are most certainly not enjoyable things to deal with, fortunately there are consumer protections in place through the Fair Credit Billing Act which allow you to dispute charges in these situations when you shop with a credit card.

Essentially if the merchant misbehaves by giving you a poorly produced product, bill you incorrectly, or misbehave in some other manner, you can cancel the charge. Under the law, you need to make an effort to resolve the dispute with the merchant before calling up Visa or MasterCard to stop a credit card payment.

Charges that you are disputing have to be over $50.00 and the purchase must have been made within 100 miles of your home address. Very few credit card companies actually enforce these two regulations, but they are free to do so if they choose. Most credit card companies allow users to dispute charges that don’t meet these qualifications because they want to keep their customers happy with their service. There’s a pretty good chance you will be able to dispute a charge that you made online.

Here’s how it works. You pay for a purchase with your credit card, only to find out the product was broken when it arrived. You call the retailer and try to resolve the situation, but they won’t do anything about it. Now you call your credit card company, and tell them that you’d like to dispute a charge. They’ll ask you for some information, and then temporarily credit the money back to your account. The credit card company will go and investigate the situation, and if they agree that the merchant was up to some sort of shenanigans they will permanently credit the money back to your account.

You also have the option of making the complaint by mail. If you choose to write a letter to your credit card company, make sure you include your account number, and the date on which the disputed charge appears as well as the amount. Include a description of why you’re disputing the charge as well as any pertinent documents such as receipts, contracts, or service agreements. Be sure to send your letter by certified mail, return receipt requested, and send the letter to the credit card company’s “billing inquiries” address, which will be a different address than you send your payments.

Don’t wait too soon; you need to file a dispute no later than 60 days after the charge was made to be protected under the Fair Credit Billing Act.

In most cases the credit card company will side with the consumer during a disputed charge. The credit card company will put in a full effort to get the other side of the story, but often times merchants were either actually misbehaving or just won’t put any effort into their side of the story, which will then cause the credit card company to side with the consumer by default.

The ability to dispute charges on a credit card is a very powerful tool for consumer protection. Use it wisely.