What is a Credit Card Dispute Letter?
A Credit Card Dispute Letter is used to dispute a fraudulent charge under a credit card holder's name and information, billing errors, or a credit card charge for bad service or services not rendered.
A credit card holder who is a victim of identity theft or notices suspicious spending must call or send a Credit Card Dispute letter to his or her credit card company. He or she must report the dispute immediately and ask for a financial statement.
How to fill out a Credit Card Dispute Letter?
Before filing a Credit Card Dispute Letter, prepare other supplementary documents to verify the legitimacy of your claim.
Enter the name of the creditor.
Enter the account number of your credit card.
Enter the date when a fraudulent purchase happened.
Enter the fraudulent purchase made under your name and information.
Enter the name of the merchant.
Enter the amount of the fraudulent purchase made under your name and information.
Enter the total amount of the fraudulent purchase made under your name and information.
Enter descriptions about the documents attached to verify the veracity of your claim.
Enter your name and signature.
When to file a Credit Card Dispute Letter?
Submit a Credit Card Dispute Letter to your credit card company within 60 days after you received a suspicious charge on your statement.
A fraudulent purchase or charge can be highly alarming, so it requires immediate action. You must contact your credit card company to report the issue.
It is essential to secure your account and get rid of the dispute immediately. Thus, review your credit account monthly to check whether there is suspicious spending and report it to your credit card company.
What are the supporting documents used to report a billing error?
Aside from the accomplished Credit Card Dispute Letter, you may submit a photocopy of a police report, proof of payment or purchase, or other receipts that will support your claim.
How do you know if there is a dispute in your credit account?
You can notice if there is a dispute in your credit account if:
- there is an unauthorized transaction;
- there is a math error;
- there is wrong or unfamiliar dates and amounts of charge;
- you were charged multiple times for something;
- credits were not posted to your account after returning items; or
- payments were not posted to your account after paying for items.
These are the billing errors recognized by the Fair Credit Billing Act (FCBA), a federal law designed to give consumers the rights to dispute unfair credit billing practices.
However, there are instances when credit card holders make mistakes in reviewing their accounts. Contact your credit card company before sending a Credit Card Dispute Letter regarding the dispute on your credit account to confirm your suspicions.
You can also contact the seller or merchant of a fraudulent purchase to ask for details.
What are the types of credit card disputes?
There are three types of credit card disputes.
1. Fraudulent Charges. A fraudulent charge is a type of credit card dispute that needs immediate action regardless of the amount. It could be highly alarming that the Federal Deposit Insurance Corporation (FDIC) suggests that consumers must file a police report to track such a crime.
2. Billing Error. A billing error is a type of credit card dispute defined by the FCBA as:
- the charges that list the wrong date or amount;
- the charges for goods and services you didn't accept or that weren't delivered as agreed;
- math errors;
- a failure to post payments and other credits, like returns; or
- a failure to send bills to your current address — assuming the creditor has your change of address, in writing, at least 20 days before the billing period ends.
3. Bad Service or Service Not Rendered. Bad service or service not rendered is a type of credit card dispute in which the consumer has the right to dispute charges if dissatisfied with his or her transaction with a merchant.
What happens after filing a Credit Card Dispute Letter?
Your creditor may put your account on hold during the investigation. Until the dispute is proven wrong or correct, any payment shall be withheld.
If the result of the investigation shows that there is indeed a dispute on your account, the credit company must provide a written explanation about how it happened. Also, the corrections to your credit account, such as removing all finance charges, late fees, and other billing errors, must be included.
On the other hand, if your reported bill is correct, the credit company must provide a written explanation of how much money you owe them and why. If you have objections regarding the result, write to your credit company within ten days after receiving the written explanation.
What is the Fair Credit Billing Act?
The Fair Credit Billing Act (FCBA) is a federal law enacted in 1974 that protects consumers against unfair credit billing practices. It allows the consumers or credit cardholders to dispute their billing errors and requires the creditors to address the issue.
To be protected under the law, consumers must follow the following rules set by the FCBA:
- The consumer's disputed amount must exceed $50 to be eligible for consideration.
- The consumer must report a dispute within 60 days upon receiving the billing error from the credit company.
- All complaints about the billing error must be sent in writing.
- The complaint letter or Credit Card Dispute Letter must include the official name, physical address, and details about the disputed billing error.
- The consumer must attach the necessary documents to back up his or her claim.
FCBA also established the following rules that credit companies must follow:
- Upon receiving the consumer's complaint or Credit Card Dispute letter, a credit company must issue an acknowledgment receipt within 30 days.
- The credit company must conduct a maximum of 90 days to investigate the billing dispute.
- The credit company must not collect any payments from the consumer on the disputed bill amount.
- The credit company must not report the consumer to any credit reporting agency nor consider the disputed bill amount as debt until proven correct.
If credit companies defy the FCBA rules, they cannot collect the disputed bill amount from the consumer regardless of the result of the investigation.