Dealing With Credit Card Billing Errors

Credit card billing errors are frustrating, but if you experience opening your monthly statement and finding erroneous charges, take heart in the knowledge that federal law is in place to protect your rights and to correct the error.

Billing errors covered by the Fair Credit Billing Act (FCBA)

The FCBA applies to "open end" revolving credit accounts (like credit cards and lines of credit). It does not apply to installment loans with a fixed repayment schedule. The following errors are a sampling of what is covered by the FCBA:

• Unauthorized charges (you are liable for only $50 per card)
• Charges for merchandise or services you did not receive
• Charges for goods or services that were not delivered as agreed
• Charges with the wrong date or amount
• Payments or credits to your account that were not posted
• Bills that went to a wrong address (as long as you notified them in writing 20 days ahead of the end of the billing cycle)
• Questionable charges (if you have asked for written proof of purchase or explanation)
• Mathematical mistakes
• If you were charged twice for the same goods
• Charges for items you returned
• If you were charged more than the agreed amount

How to dispute billing errors made by credit card companies

• Contact your credit card company in writing within 60 days of the billing date
• Send the letter to the address for "billing inquiries" or "in case of errors" - not the address where you send your payment
• Include your name, address, account number, description of the error, and copies of receipts or other information to verify your claim
• Send the letter certified mail with return receipt requested
• Keep a copy of the letter you sent
• The creditor is required to respond within 30 days of receiving your letter
• The error must be resolved within two billing cycles (not to exceed 90 days)
• While the dispute is being investigated, you will not have to pay finance charges

How to dispute a credit card charge from a merchant

If the problem is with a merchant and not with the credit card company, the FCBA covers the problem only if you attempt to settle the dispute with the merchant before you contact your credit card company. Here are some guidelines:

• Contact the merchant promptly by phone and explain the problem
• Follow up the phone call in writing, re-stating the issue, the date you called, and who you talked to
• Allow the merchant a "reasonable" time to investigate and respond
• Keep a detailed record and copies of all conversations and correspondence
• If goods were not shipped because they are back ordered, you have the right to cancel the order

If you cannot resolve the problem with the merchant after sincerely trying to reach an agreement, contact your credit card company. Have all of the paperwork handy as the card company will need all of the information you have in order to investigate. If the credit card company finds that you are in the right, they will remove the charge from your account.

For more information about your rights under the FCBA, visit the Federal Trade Commission website at: www.ftc.gov.