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How (and when) to dispute a credit card charge

June 07, 2020
7 min read
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We’ve all been there — you open up your credit card app or check out your account online to pay a bill or look over recent purchases, and you notice a charge that doesn’t add up. Either it’s at a merchant you don’t recognize, or it’s for a purchase you’ve made, but in the wrong amount. Or maybe the charge doesn’t reflect a return you’ve made.

Many may wonder what options they have for getting those errors fixed if the merchant is unwilling or unable to make the necessary changes. However, there is an option in those cases with your credit card company: issuing a dispute.

When can you dispute a credit card charge?

The Fair Credit Billing Act (FCBA) of 1975 gives consumers protection against creditors in certain situations regarding unauthorized charges and certain billing errors. Under the FCBA, you are entitled to be able to take action against a card issuer in circumstances for these types of charges:

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  • Unauthorized charges
  • Charges with an incorrect date or amount charged
  • Charges for undelivered goods and services
  • Math errors
  • Failure to post payments or credits for returns
  • Failure to send bills to your current address
  • Charges for which you request clarification or written proof of purchase
Closeup shot of a unrecognizable person giving a barman a credit card as payment inside of a restaurant(Photo by shapecharge/Getty Images)
Legitimate charges made by you or an authorized user should not be disputed. (Photo by shapecharge/Getty Images)

This means that you can’t dispute a charge just because you are dissatisfied with a product or service or didn’t agree with an authorized user making a certain purchase. Think of it this way: If you’re not willing to file a police report on the person who made the purchase without your permission, you shouldn’t try to dispute the purchase.

But let’s say that you order a product through an online seller, and that product arrives at your house shattered. If you are unable to resolve the matter with the merchant, you could then escalate to disputing the charge.

For TPG readers, this could also apply to certain extreme situations in trying to get refunds from airlines or other common carriers. If you are unable to get a refund from an airline when your flight is canceled or even trying to refund tickets from an airline that’s gone bankrupt, disputing the charge is likely the best option to resolve the issue.

Rule of thumb: Talk to the merchant first

Your first course of action should always be to reach out to the merchant in cases of billing error or order issues. Many times, this is the fastest way to get something resolved. And most companies will work with you to try and fix the problem without getting the credit card issuer or payment network involved.

But should you not be able to receive a warranted refund or other acceptable resolution from the merchant, a credit card dispute should be your next step.

How to dispute a purchase

If you notice a fraudulent purchase or another disputable charge (that you’ve already tried to resolve directly with the merchant), it’s time to reach out to your credit card issuer to dispute the charge through them.

If you suspect there’s been an unauthorized charge made to your account, you should call the customer service line on the back of your card to talk through next steps with the issuer, including replacing your cards and resetting your online account information.

Related reading: Credit card fraud vs. identity theft — how to know the difference

In this guide, I’ll focus on how to dispute a charge that deals with a merchant billing error or other associated issues.

Step one: Gather necessary evidence

Keep receipts, photos and any communication you’ve made with the merchant to try and resolve the issue. In many cases, your issuer will ask for evidence of the billing error and that you’ve made a good-faith effort to reach out to the merchant before they will step in.

Step two: Fill a charge dispute with your issuer

Most issuers offer an easy way to do this online, including Amex, Chase, Citi and Bank of America. Usually, there is a “Dispute This Charge” option when you expand a specific charge.

(Screenshot obtained from my account 6/1/20)
You can dispute a charge from Amex's transaction details screen on desktop or in the app. (Screenshot obtained from my account 6/1/20)

Remember that usually, you can only dispute charges that have already posted. Pending charges generally will not have a “Dispute” option available online or in the app.

If you can’t find where to submit a dispute online, you can also call customer service and dispute a charge that way.

Step three: Follow up in writing

Keep in mind that while the Fair Credit Billing Act does offer consumers protections, those protections are dependent upon you following its guidelines. This means you’ll need to send in a formal dispute letter by mail (yes, snail mail) within 60 days of the disputable charge.

The Federal Trade Commission lays out your specific rights and the guidelines you must abide by in order to be protected. They also provide a sample letter you can use.

Now, this step isn’t required to dispute a charge with your credit card company if the issuer has other avenues to request a dispute. And most of the top credit card companies will work with you to resolve the issue. But it is worth noting that the only way you’ll technically be covered in the eyes of the Fair Credit Billing Act is by sending in a written request.

(Image courtesy of Maskot/Getty Images)
While you can dispute charges online or by phone, it's a good idea to also send in a request via mail to ensure you are protected by the FCBA. (Image courtesy of Maskot/Getty Images)

Chargebacks: What happens when you dispute a purchase

So you’ve disputed a purchase. What happens next?

Many issuers will issue you what’s called a chargeback. Essentially, a chargeback is a reverse credit card purchase. A charge is sent back up the line from your account to your card issuer to the merchant bank and back to the merchant, all through the payment network used (such as Visa or Mastercard). This way, a charge is removed from the consumer’s account and the issuer is able to “charge back” the cost to the merchant when deemed appropriate.

Bottom line

The Fair Credit Billing Act does offer protection in cases where unauthorized or incorrect charges are made on your account, and most issuers are diligent about helping cardholders where possible.

You should only dispute charges in the appropriate circumstances outlined above. But the dispute and chargeback process can help cardholders receive refunds and correct billing errors in the cases where you are unable to make it work with a merchant.

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Featured image by Getty Images

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Best Marriott card for Business Owners
TPG Editor‘s Rating
Card Rating is based on the opinion of TPG‘s editors and is not influenced by the card issuer.
3 / 5
Go to review

Rewards Rate

6X6x points at hotels participating in the Marriott Bonvoy® program.
4X4x points for purchases made at restaurants worldwide, at U.S. gas stations, on wireless telephone services purchased directly from U.S. service providers and on U.S. purchases for shipping.
2X2x points on all other eligible purchases.
  • Intro Offer
    Limited Time Offer: Earn 100,000 Bonus Marriott Bonvoy Points after spending $4,000 in purchases on your new Card in your first 3 months of Card Membership. Offer expires 11/2/22.

    Earn 100,000 points
    75,000 points
  • Annual Fee

    $125
  • Recommended Credit
    Credit ranges are a variation of FICO© Score 8, one of many types of credit scores lenders may use when considering your credit card application.

    670-850
    Excellent/Good

Why We Chose It

The Marriott Bonvoy Business Amex is a stacked card with a rewards rate that will help you earn bonus points on everyday and business-related purchases. You'll earn 15 elite night credits each calendar year, and receive automatic Gold elite status. Finally, the free night award certificate with a redemption level of 35,000 points or less can get you hundreds of dollars in potential value each year.

Pros

  • 6x points on eligible purchases at hotels participating in the Marriott Bonvoy program
  • 4x points at restaurants worldwide, U.S. gas stations, wireless telephone services purchased directly from U.S. service providers and U.S. shipping
  • 2x points on all other eligible purchases
  • Earn a free-night award each card renewal month (up to 35,000 points)
  • Receive 15 elite night credits to jump-start status
  • Transfer Marriott points to 40+ airlines

Cons

  • Airline points transfer ratios are poor
  • Must spend $60,000 in a year for second free-night award
  • Limited Time Offer: Earn 100,000 Bonus Marriott Bonvoy Points after spending $4,000 in purchases on your new Card in your first 3 months of Card Membership. Offer expires 11/2/22.
  • 6x points at hotels participating in the Marriott Bonvoy® program.
  • 4x points for purchases made at restaurants worldwide, at U.S. gas stations, on wireless telephone services purchased directly from U.S. service providers and on U.S. purchases for shipping.
  • 2x points on all other eligible purchases.
  • Receive a 7% discount off standard rates for reservations of standard guest rooms at hotels that participate in the Marriott Bonvoy program when you book directly. Terms and Conditions Apply.
  • Receive 1 Free Night Award every year after your Card renewal month. Plus, earn an additional Free Night Award after you spend $60K in purchases on your Card in a calendar year. Awards can be used for one night (redemption level at or under 35,000 Marriott Bonvoy® points) at hotels participating in Marriott Bonvoy®. Certain hotels have resort fees.
  • Enjoy Complimentary Marriott Bonvoy Gold Elite Status with your Card.
  • Terms apply.
  • See Rates & Fees