How Chase Cardholders Can Opt out of New Binding Arbitration

Jun 2, 2019

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Nearly 10 years after Chase dropped arbitration clauses from its credit cards as part of a legal settlement, the largest US credit card issuer has informed cardholders that it will be adding back a binding arbitration provision effective August 10, 2019.

Binding arbitration essentially prevents customers from taking Chase to court to settle disputes. Instead, their cases are heard by a private arbitrator, often paid for by Chase. Here’s what the fine print of Chase’s announcement say about arbitration:

“With arbitration, you cannot go to court, have a jury trial or initiate or participate in a class action for your dispute(s) with us. In arbitration, disputes are resolved by an arbitrator, not a judge or jury, and procedures are simpler and more limited than rules applicable in court.”

While this is undeniably a negative development for Chase customers, you do have the ability to opt out. Those covered by the Military Lending Act will be automatically opted out of the arbitration agreement, while anyone else wishing to opt out can do so by mailing a letter to the following address: P.O. Box 15298, Wilmington, DE 19850-5298. These letters must be received by August 9, 2019, in order to be effective, and opt-out notices sent to any other address, by phone or by email will not be recognized.

The letter itself is fairly simple, and needs to include a written note stating that you reject the agreement to arbitrate and must include your name, account number, address and personal signature. If you have multiple credit accounts with Chase, be sure to include all your account numbers. Military Money Manual even published a template letter you can use to expedite the process.

“Binding arbitration” sounds like a lot of complex legal language, and the fact that this notice was delivered in a document full of fine print sure doesn’t help. At the end of the day, Chase is informing you that unless you opt-out by August 9, you will lose your right to sue Chase in the event that they mistreat you. Chase has paid hundreds of millions of dollars in the last decade to settle class action lawsuits for everything from raising ‘fixed’ interest rates without notifying customers to improperly reporting accounts that were discharged during bankrupts proceedings. Even if you’re happy with your Chase credit cards and Ultimate Rewards points, there’s no reason to give up this legal protection when it’s so easy to save.

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