How to Win a Credit Card Dispute: A Step-by-Step Guide

Unauthorized charges or billing errors on your credit card statement can be frustrating, but as a consumer you have a right to dispute them. To have a better chance of winning, you need to understand your rights and the dispute process. You’ll also need to build a solid case, properly file the dispute, and stay vigilant during the investigation.

Let’s explore how to win a credit card dispute as well as how you can file an appeal if you get denied.

Key takeaways

• The Fair Credit Billing Act of 1974 gives you the right to dispute billing errors and unauthorized charges on your credit card.
• You must file your credit card dispute within 60 days of discovering the charge on your statement.
• After receiving your claim, credit card issuers have 90 days to complete an investigation and make a ruling on a dispute.
• You can appeal unfavorable decisions in credit card disputes.

How does the credit card dispute process work?

The Fair Credit Billing Act (FCBA) was passed in 1974 to give consumers the right to dispute possible billing errors and unauthorized charges on their credit card accounts. The law also sets guidelines on how the dispute process works.

The credit card dispute process begins when you, the cardholder, find a questionable charge on your credit card statement. You have 60 days after discovering the charge on your statement to contact the credit card issuer and dispute it. The credit card company then has 30 days to respond to you, acknowledging the receipt of your dispute.

Within 90 days or two billing cycles, the credit card issuer must investigate the charge and determine whether it is legitimate. During this investigation, the issuer will get information from you and the merchant involved in the transaction. The merchant can provide evidence of a legitimate charge.

After the credit card company has concluded the investigation, what happens next depends on whether the issuer decides in your favor. If you win the dispute, the card company will credit your account for the transaction amount and any interest charged on that transaction. But if the issuer decides the charge is legitimate, they must provide its reasoning in writing. You’re then still responsible for paying the amount of the transaction and any associated finance charges.

When should you file a credit card dispute?

If you see a questionable charge on your credit card statement, you have 60 days from the statement date to dispute it. Keep in mind you can’t dispute just any charge. Transactions you can take action against include:

• Unauthorized charges
• Billing errors (such as the wrong amount, wrong date, or incorrect math)
• Charges for goods and services that weren’t delivered
• Unposted payments or credits
• Charges you’re unsure of and need more information on

The credit card dispute process is a valuable tool for resolving billing errors or possible fraudulent charges, but there are also situations when filing a dispute isn’t appropriate. For example, you shouldn’t dispute a charge because of buyer’s remorse — when you know you purchased the item or service but just felt dissatisfied after the fact. You should instead work with the merchant directly in such situations.

How to win a credit card dispute in 5 steps

Even if you have one of the best credit cards, there’s always a chance that your dispute might be unsuccessful. Here are five steps you can take to give you a better chance of building a solid case and winning:

1. Work with the merchant first

If the error was on the merchant's part, you may be able to fix the issue more quickly and easily by working with them before proceeding with a credit card dispute. For example, if you never received something you purchased but were still charged for it, reach out to the store and give them a chance to send you the item or refund your money.

I’ve used this strategy when unknown subscriptions appear on my credit card statement. You know — the type of subscriptions you’re automatically signed up for after you make a purchase. In almost every case, if I call them soon after the charge appears on my statement, the merchant has issued me a refund.

It’s also important to check the merchant’s refund policies to ensure you’re still within the period when they accept returns and issue refunds. However, the retailer might still be willing to work with you even if that time has passed.

2. Understand your rights and key deadlines

It’s crucial that you understand your rights as a consumer and key deadlines for filing credit card disputes that are afforded to you under the Fair Credit Billing Act and the Truth in Lending Act. To dispute a charge, you must contact the credit card issuer within 60 days of when the charge first appeared on the statement.

While you can call the credit card company, you should also send a written notice for the dispute. Your statement should note the address you need to use for billing disputes. It’s also a good idea to use certified mail, so that you have proof of when the credit card company received your notice.

3. Build a solid dispute case

To build your case for disputing the charge with your credit card company, you’ll need evidence to back up your claim. Documents that help support your claim may include:

• Credit card statements
• Receipts or invoices
• Return or refund receipts
• Correspondence with the merchant via emails, letters, or online chatbots
• Shipping receipts
• Photos

A friend of mine got suckered in by a social media ad promoting inflatable kayaks for only $50 (they usually cost over $90). After he purchased two of them, the merchant never sent the kayaks but instead sent a bag of socks. When he disputed the charge with his credit card company, the merchant claimed they had sent him “the product.” Thankfully, he had taken a photo of the socks he received instead of the kayaks and showed it to his credit card company, and they promptly refunded him for the transaction.

4. Properly file the dispute with your creditor

You can file a credit card dispute via various methods, including mailing letters, calling customer service, or filing it on the issuer’s website. However, if you choose to file your complaint on the phone or online, you should follow up with a written notice sent by certified mail so you have proof that the credit card company received the dispute within the 60-day timeframe.

Your written notice should include your name, account number, amount, date of the error you’re disputing, and the reason for the dispute. You should send it to the address the card company uses for billing errors and inquiries, which you’ll usually find on your monthly statement.

5. Wait for the investigation results

Once you’ve filed a dispute and your creditor has responded that they’ll look into it, the card company has 90 days to conduct and complete the investigation. During this time, you must continue making payments on the card’s balance – but not on the amount in dispute.

The credit card company can’t legally try to force you to pay the disputed amount, close your account, or threaten to lower your credit score. However, the creditor can report the dispute to the credit bureaus. Once they settle your dispute, any remarks about the dispute should go off your credit reports.

The credit card issuer must send you a written notice of its decision. If they find an error, they must let you know how and when they’ll correct your account. If the credit card issuer finds the transaction legitimate, they must tell you why they made this decision, how much you owe, and when you have to pay it.

What to do if your credit card dispute is denied

If you get a denial, you can still take several steps to try to resolve the issue. First, carefully review the denial letter from the credit card company to determine if there was information that you may have left out of your original submission that could have helped your case.

You have a right to appeal the credit card company’s decision within 10 days of getting their letter explaining the denial or during the period you have to pay the charge – whichever is later. But even if you file an appeal, the credit card company can start collection procedures against you for the charge if you refuse to pay it.

You may also consider filing a complaint with the Consumer Financial Protection Bureau (CFPB) if you feel the denial was unjustified or if the credit card company didn’t handle your dispute in accordance with the Fair Credit Billing Act. If you decide to take this route, it may be wise to consult a consumer rights attorney.

FAQs

Bottom line

The credit card dispute process helps protect you against billing errors and unauthorized charges. Under the Fair Credit Billing Act, you have the right to dispute credit card charges and have that dispute addressed within specific timelines. This makes it important to watch your card statements and act promptly so you can spot and report these charges before it’s too late.

While the process may be straightforward, success often hinges on meticulous preparation and timely action. You can sometimes work with the merchant directly to fix the issue more easily than going to your creditor. But if the dispute escalates, know your rights as a consumer and your ability to appeal an unfavorable decision. You can also seek assistance from an attorney or regulatory body.

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