How to Dispute a Credit Card Charge

Take Advantage of Protection Provided by Federal Law

We all appreciate the convenience and comfort of using our credit cards to purchase goods or services, but few of us appreciate the powerful tool it can become when we want to resolve a dispute with a merchant.

Perhaps you bought a new DVD player and when you got home you realized that it was refurbished and not new at all. Or you purchased a sweater at a large department store and when the statement arrived you see that you were charged twice. Or maybe you charged a deposit for a roof repair and the workmen never showed up and no one at the company will answer your calls. All of these situations, while frustrating, may be able to be resolved merely by contacting your credit card issuer.

Needless to say, the first course of action to take is to contact the merchant directly and try to resolve your differences with them; but act quickly and take notes, including dates, names of persons spoken to and what took place. If this fails to satisfy your complaint, you still have options. By the way, what will be explained in the balance of this article is how to obtain a refund of your disputed amount. A refund results in a “chargeback” to the merchant, which can further result in increased expenses from the credit card company to the retailer, so if you are not getting anywhere with the merchant, let them know you will dispute the charge with your credit card company and see if that gets more action.

The Fair Credit Billing Act, allows consumers to withhold payment on poor-quality, damaged merchandise or incorrectly billed items they bought with a credit card until the matter is resolved.

If the merchant refuses to correct the problem, write a detailed letter delineating your dispute, and mail it to the merchant using certified mail with a return receipt requested for your records. Save a copy for your records and another copy, which you will send to your credit card company, as proof that you first tried to resolve this dispute with the merchant. Call your credit card company and tell them you want to register a dispute with a merchant charge. They will most likely send you a form to fill out or they may ask you to send them a letter disputing the purchase or charge; you will need to do this in writing and within 60 days after the bill, with the disputed charge, was sent to you. In your letter, you will need to include your account number, the closing date of the bill on which the disputed charge appears, a description of the disputed item and the reason you are withholding payment. This is where you also enclose a copy of your complaint letter to the merchant, and any other documentation that supports your position. This letter should also be sent certified mail with return receipt requested to an address provided when you called to register your dispute with the credit card issuer. If it is available to you, you may be able to register your dispute online at your credit card company’s website.

At this stage some companies may issue a temporary credit until they have investigated the dispute, but you must remember that your statement has to be paid to avoid late fees and interest charges, so make sure you pay on time. Your credit card issuer will contact the merchant to investigate your claim. They may even use a conference call with you and the merchant. Some companies utilize an arbitration procedure to resolve disputes. If the card issuer agrees with your version, you will get a full refund. If not, you will have to pay for the disputed item and any interest that may have accrued.

OK, what’s the catch? According to the Fair Credit Billing Act, the sale must be for more than $50 and must have taken place in your home state or within 100 miles of your billing address, which can exclude certain internet or telephone sales, but few credit card companies enforce these rules on purchases so that they can please their customers.