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How To Dispute A Credit Card Charge: Step By Step

Sarah Sharkey5-Minute Read
November 22, 2021

The Fair Credit Billing Act created a pathway for you to dispute credit charges. The charges in question must be an error, fraudulent, or the result of an unsatisfactory experience with a merchant’s goods or services.

Have a charge on your credit card that needs to be removed? The Fair Credit Billing Act will protect you throughout the process. Here’s how to dispute a credit card charge.

Step 1: Investigate The Transaction

Consumers can dispute credit card charges on their statement that they deem to be inaccurate, outdated or unauthorized. As a result, this process can lead to new cards being issued, updated statements and much more.

It is a good idea to check over your credit card charges at least once a month to spot mistakes. In the case of errors or unrendered services, you only have 60 days to initiate the reporting protocol.

Charges That Can Be Disputed

Not all charges that appear on your credit card can be disputed. But here are the most common reasons why you might dispute a charge.

  • Buyer doesn’t make an authorized payment: Did a fraudster take your credit card on a shopping spree?
  • Buyer doesn’t receive a refund on a refunded item: Did a merchant take a returned item without issuing a refund?
  • Billing errors: Did your credit card issuer mistakenly charge a fee to your account? Did a merchant charge the incorrect amount for a purchase?
  • Buyer never received the item purchased: Did the item you ordered get delivered?

Charges That Can’t Be Disputed

Although you can dispute many charges, some will stand without dispute. These include:

  • Buyer’s remorse: If you regret your purchase, you cannot dispute the charge. But you may be able to make a return.
  • Buyer is unhappy with an authorized purchase made: If the purchase doesn’t live up to your expectations, you won’t be able to dispute the charge.

Ultimately, you cannot dispute any purchases you authorized. But errors, fraudulent charges and missing items are fair game.

Step 2: Contact The Appropriate Party

When you spot a charge on your credit card that you don’t agree with, you’ll need to take your case to the appropriate party. In some circumstances, you’ll need to go straight to the card issuer. But in others, it is better to work out the disagreement directly with the merchant.

When To Contact A Merchant

Here’s when a merchant should be your first point of contact.

  • Incorrect price charged: The wrong charge amount could be easily fixed with a call to the merchant.
  • Returned item not processed: If you return an item without receiving a refund, reach out to the merchant.
  • Item not received: If an item you order is never delivered, contact the merchant.

A respectable merchant that you've done business with should be able to rectify a mistaken charge quickly. When reaching out, explain the situation respectfully and see what they can do for you.

When To Contact A Card Issuer

Depending on the nature of the charge, you may need to work directly with the card issuer to resolve it. Fraudulent charges and billing errors are common reasons to have a conversation with the issuer.

Fraudulent Charges

Fraudulent charges can happen to any credit card user. But credit card companies are ready and willing to help you combat this issue.

The Fair Credit Billing Act allows you to be held responsible for unauthorized charges of up to $50. But most credit card companies won’t require you to cover any portion of a fraudulent charge.

You can report a fraudulent charge at any time, but the sooner, the better. If you can report the charge within two billing cycles, that is preferred by most credit card issuers. Depending on the severity of the fraudulent charge, you can also file a police report. Although it is not required, a police report helps government agencies keep track of these crimes and to notice patterns of financial crimes in their area.

Before you can dispute the charge, you’ll need to confirm that it is incorrect. Take a minute to confirm that a family member did not make the charge with your credit card.

Billing Issues

Billing issues are another common reason to dispute a charge.

Here are the reasons why you can dispute a billing error:

  • Charges with the wrong date or amount
  • Charges with math errors
  • Charges for goods and services you didn’t receive
  • Failure to post payments and credits, like returns, to your account
  • Failure to send the bill to your current address, if the creditor has received your change of address in writing
  • Charges that you seek an explanation of in writing

If you want to dispute a billing error, then you’ll need to write a letter to your creditor. The letter must reach the creditor within 60 days of the first bill that contained the error.

The letter should include your name, address, account number, and information about the billing error. Additionally, you can include copies of the supporting documentation for your claim. Once the creditor receives the letter, they are required to write back within 30 days and resolve the issue within two billing cycles.

Step 3: Take Action Going Forward

If you spot an incorrect charge on your account, take action to dispute it. The card issuer will be willing to help you. But you’ll need to initiate the process and potentially discuss the issue with a merchant before getting the credit card company involved. Here are other steps you’ll want to take to mitigate the chances of future fraud.

Obtain A New Card

If you experienced fraudulent charges, it is critical to obtain a new card as soon as possible. Fraudulent charges mean that someone has unauthorized access to your card information. With that, it is important to cancel the original card and seek a replacement from your credit card issuer immediately.

Keep Record For Future

As you navigate the process of disputing a charge, keeping a record of the incident is helpful. If you are working with a merchant, hang on to any written exchanges as proof that you tried to resolve the issue with them first. A credit card issuer may require you to provide evidence that you talked to the merchant before moving forward with your dispute.

Do Credit Card Disputes Affect My Credit?

The act of disputing a credit card charge will not impact your credit score. The disputed charge may appear on your credit report. But lenders aren’t allowed to deny you credit opportunities based on a disputed charge or bill.

You won’t be forced to pay for the charge in question while it is under investigation. But you should absolutely keep up with the rest of your credit card payments while the dispute continues. After the investigation, you’ll have to cover the complete charge if the issuer determines that you are responsible for the charge. If you don’t make the payment, it will negatively impact your credit score.

The Bottom Line

A credit card charge that needs to be disputed can lead to a headache. But working with a merchant or credit card company to resolve the issue will keep the cost of this issue to a minimum.

Want to learn more about your credit? Take advantage of the resources offered in the Rocket HQSM Learning Center.

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Sarah Sharkey

Sarah Sharkey is a personal finance writer that enjoys helping readers learn more about their finances. She has an MS in Business Management from the University of Florida. You can connect with her on LinkedIn or Instagram @adventurousadulting.