Disputing Credit Card Debt

Underscoring the need to always look at credit card charges and statements, it’s not all that unusual to, at some point, be hit with credit card debt that doesn’t belong to you.

Whether it’s double billing, being charged for something you never got, or something else, these are usually just errors, which is empty consolation when you’re the one affected. The good news is that, when it comes to disputing credit card debt, you’re covered by federal law. Read on.

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The Fair Credit Billing Act (FCBA)

As set forth by the Federal Trade Commission, the FCBA covers open-end credit accounts such as credit cards in addition to revolving charge accounts – department store accounts, for example. What the law does not cover, however, are installment agreements. These include extensions of credit or loans that are repaid on a set basis (vehicles, personal loans, major appliances, etc.).

FCBA Dispute Settlement Procedures

Disputes here must be about billing errors such as:

  • Failure to send bills to your current provided address at least 20 days before the billing period ends
  • Failure to post payments and other credits such as returns
  • Mathematical errors
  • Charges for items or services either you did not accept or were delivered counter to what was agreed to
  • Charges that carry an incorrect amount or date
  • Unauthorized charges, for which your responsibility is capped at $50

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Taking Advantage of FCBA Protections

To exercise your rights, you are required to contact your creditor. What you must first do, however, is determine the address provided for billing inquiries, rather than the one you use for payments. If you’re behind with payments and need help with credit card debt, we suggest contacting Freedom Debt Relief.

Note that you must allow time for the dispute letter to get to the creditor. The correspondence must get to them within 60 days after you received the first bill with the error. Make sure you include copies of sales receipts or other pertinent documents. It’s recommended that you send the letter via certified mail, and that you retain a copy of it.

You must hear from the creditor in writing about the dispute within 30 days of their getting it. If it hasn’t been already, the dispute must be resolved within two billing cycles following letter receipt.

Information Regarding the Dispute Investigation

  • While your dispute is being investigated, you needn’t pay the disputed amount.
  • The creditor is prohibited from entering the disputed amount into collections. However, that amount can temporarily lower your credit limit.
  • The creditor is barred from penalizing you concerning the dispute by reporting you as delinquent, threatening to hurt your credit, speeding up the payment due date, restricting or shuttering your account, or denying you credit.
  • Billing errors require the creditor to explain in writing what fixes will be made. Note that the creditor is required to erase any late fees or charges pertaining to the mistake.
  • If it’s determined that you must pay part of the disputed total, the creditor is obliged to send you a written explanation.
  • If it’s found that the bill is accurate, the creditor must write you right away with an explanation. You’ll also be liable for any finance charges that piled up during the dispute period.
  • If, following the investigation, you do not agree with the results, you must write to the creditor within 10 days of explanation receipt. If you refuse to pay, collections may begin. However, the credit report must reflect that you don’t believe you owe the debt.

As you see, disputing credit card debt is a process. The good news is that the federal government has put in place processes and protections. Again, if you need help to pay credit card debt, contact Freedom Debt Relief.

Disputing Credit Card Debt

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