Ted Rossman
Ted Rossman, senior industry analyst specializing in credit cards, credit scores and other personal finance topics at Bankrate.com and CreditCards.com.
Are you having a problem with a merchant over a product or service? Perhaps, the $3 tip tacked onto a dinner tab without your permission…the new mattress that arrived damaged…a purchase you were double-billed for by Amazon.com?
To resolve these and other credit card disputes, millions of consumers are turning to what used to be a last-resort strategy—they are requesting that their credit card issuer “chargeback” or reverse a transaction on their monthly statement. Since the COVID pandemic, chargeback disputes have surged. Last year, more than 100 million of them, totaling $11 billion, were filed in the US. The dollar amount is up by about $4 billion since 2019 and is expected to rise by another 40% by 2026. Reasons: Credit card issuers have streamlined the process for chargebacks—in many cases, you just click on and send a form from your issuer’s smartphone app. Also, consumers are wising up to their full rights under federal law—not only can you dispute billing mistakes, unauthorized or incorrect charges, and transactions for products that were defective or not delivered, you also can contest charges for goods or services that differ from what was described or agreed to.
Credit card expert Ted Rossman of Bankrate.com suggests the following steps to dispute a credit card charge…
First try to get a refund from the merchant. Not only is this the fastest way to correct the problem, but some banks expect you to make the effort before you file a credit card dispute. If the merchant isn’t helpful or responsive, state either in a phone call to customer service or via an online chat that you will be going to your credit card issuer for a chargeback. That can be effective because merchants don’t want to be dropped by a credit card network for having too many chargebacks.
File your dispute in a timely manner. Federal law protects cardholders for only a limited time. For most transactions, you have only 120 calendar days from the date of the purchase to file a dispute with your card issuer.
If you have not paid the bill: You can dispute the credit card charge without risking damage to your credit score. Your bank will either post a temporary credit to your account for the disputed amount or pause required payments and interest on the disputed amount until a decision is made.
If you have already paid the credit card bill that has the purchase you are contesting: You can still file a credit card dispute, but the money may not be credited back to your account until the card issuer makes a ruling. It can take a few billing cycles for disputes to be resolved.
Build a solid case. Consumers often win credit card disputes because merchants don’t bother to challenge them. But you need to be specific about why the merchant did not provide the promised goods or services. Be prepared to supply supporting documentation such as photos of the product, screen shots from the merchant’s website and any communications with the merchant.
Explore other credit card protections if you don’t have a strong case for a chargeback. Examples: The merchant clearly stated you had 30 days to return an item, but it slipped your mind and you didn’t return it within that period…or you bought a non-returnable item and then found it for less elsewhere, but now you are stuck with the original item. Check if your credit card issuer offers extended-return protection, which reimburses you for items that a store won’t take back within 90 days of purchase…or price protection, which pays the difference (up to a certain dollar amount) if an item you bought drops in price within 90 days of purchase.
