You received your credit card statement. Good thing that you took a look at it because there is a charge on it that you know that you didn't make. Great, now what?
Well, if you're like me, you'd call the credit card company and ask them to look into it. On the surface, it would seem that this should be enough; it isn't. You have some rights under the Fair Credit Billing Act (FCBA) and further protection under Reg Z, but in order to preserve those rights, you need to make sure that you follow the rules.
The FCBA procedures apply only to disputes about 'Billing Errors'.
- unauthorized charges. Federal law limits your responsibility for unauthorized charges to $50;
- charges that list the wrong date or amount;
- charges for goods and services you didn't accept or weren't delivered as agreed;
- math errors;
- failure to post payments and other credits, such as returns;
- failure to send bills to your current address - provided the creditor receives your change of address, in writing, at least 20 days before the billing period ends; and
- charges for which you ask for an explanation or written proof of purchase along with a claimed error or request for clarification.
As I mentioned earlier, you'd think a phone call would do it, but not in this day and age! Read your billing error notice very carefully! This is usually found on the back of your bank\credit union\open end\revolving account agreement. They usually read something like this;
YOUR BILLING RIGHTS KEEP THIS NOTICE FOR FUTURE USE
This notice contains important information about your rights and our responsibilities under the Fair Credit Billing Act.
Notify Us In Case of Errors or Questions About Your Bill
If you think your bill is wrong, or if you need more information about a transaction on your bill, write us [on a separate sheet] at [address] [the address listed on your bill]. Write to us as soon as possible. We must hear from you no later than 60 days after we sent you the first bill on which the error or problem appeared. You can telephone us, but doing so will not preserve your rights.
In your letter, give us the following information:
- Your name and account number.
- The dollar amount of the suspected error.
- Describe the error and explain, if you can, why you believe there is an error. If you need more information, describe the item you are not sure about.
If you have authorized us to pay your credit card bill automatically from your savings or checking account, you can stop the payment on any amount you think is wrong. To stop the payment your letter must reach us three business days before the automatic payment is scheduled to occur.
Your Rights and Our Responsibilities After We Receive Your Written Notice
We must acknowledge your letter within 30 days, unless we have corrected the error by then. Within 90 days, we must either correct the error or explain why we believe the bill was correct.
After we receive your letter, we cannot try to collect any amount you question, or report you as delinquent. We can continue to bill you for the amount you question, including finance charges, and we can apply any unpaid amount against your credit limit.
You do not have to pay any questioned amount while we are investigating, but you are still obligated to pay the parts of your bill that are not in question.
If we find that we made a mistake on your bill, you will not have to pay any finance charges related to any questioned amount.
If we didn't make a mistake, you may have to pay finance charges, and you will have to make up any missed payments on the questioned amount. In either case, we will send you a statement of the amount you owe and the date that it is due.
If you fail to pay the amount that we think you owe, we may report you as delinquent. However, if our explanation does not satisfy you and you write to us within ten days telling us that you still refuse to pay, we must tell anyone we report you to that you have a question about your bill. And, we must tell you the name of anyone we reported you to. We must tell anyone we report you to that the matter has been settled between us when it finally is.
If we don't follow these rules, we can't collect the first $50 of the questioned amount, even if your bill was correct.
Special Rule for Credit Card Purchases
If you have a problem with the quality of property or services that you purchased with a credit card, and you have tried in good faith to correct the problem with the merchant, you may have the right not to pay the remaining amount due on the property or services. There are two limitations on this right:
(a) You must have made the purchase in your home state or, if not within your home state, within 100 miles of your current mailing address; and
(b) The purchase price must have been more than $50. These limitations do not apply if we own or operate the merchant, or if we mailed you the advertisement for the property or services.
A couple of notes- You MUST write to the company, a phone call will not ensure your rights. You must WRITE to them within 60 days of the date of the notice that first contained the error. Your letter must contain your name, billing address (the address on your bill), the dollar amount of the error, and a description of why you believe there is an error.
What can you do if the creditor will not respond? You may report the creditor to the Fair Trade Commission (FTC) by calling toll-free, 1-877-FTC-HELP (1-877-382-4357); TTY: 1-866-653-4261. Or you can visit their website FTC.gov, or by completing and submitting this online form . Depending upon the situation and the dollar amount, you might want to consider hiring a lawyer to help you.