Credit Card Transaction Disputes

Summary: A credit card dispute on transactions made, offers consumers three protections: protection against unauthorized use, billing error procedures, and the right to withhold payment. Lenders follow a set of procedures when you file a credit card dispute for a discrepancy in your bills. Keep in mind that at the end of the investigation, these protections may still result in a finding that you are liable to pay for the disputed transaction. The law(s) applicable to your particular s...

A credit card dispute on transactions made, offers consumers three protections: protection against unauthorized use, billing error procedures, and the right to withhold payment. Lenders follow a set of procedures when you file a credit card dispute for a discrepancy in your bills. Keep in mind that at the end of the investigation, these protections may still result in a finding that you are liable to pay for the disputed transaction. The law(s) applicable to your particular set of circumstances will dictate the actual amount - if any - that you are liable for. Protection against Unauthorized Use In an era where merchants accept payments by credit cards on the Internet and by phone, the problems relating to the unauthorized use of credit cards have increased. Unauthorized use includes situations where your credit card or credit card number is stolen, borrowed, or used without your consent. If it is proven that your credit card was indeed used without your authority, then the law limits your liability to $50. In most cases the issuers of credit cards waive this payment. Once an unauthorized charge has been reported to the issuer, the latter makes a decision whether to take the transaction charge off your account or to investigate the validity of your claim. This reasonable investigation can consist of many things such as a verification of the signature on the credit card transaction slip, comparing the locations of your residence and the outlet where the transaction was made, and obtaining the related police report. Procedures to Follow When Disputing a Billing Error You can invoke this protection on your credit cards, when a merchant charges you for products you ordered but that never reached you, or when your credit card bill is overcharged. A federal statute, Fair Credit Billing Act (FCBA), protects you when you use your credit cards. FCBA provides that you may dispute any charges that are made to your credit cards and, that while the credit card issuer is still conducting investigations, you have the right to withhold payment without being subjected to interest for the corresponding unpaid amount. Because of this law, credit card companies are forced to pay attention to your credit card dispute. The merchant involved may, as a result of the dispute, incur credit card chargebacks. There are things you need to do if you want to avail yourself of these consumer protections afforded to you on your credit cards by the law: