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Legal How-To: Getting a Credit Card 'Chargeback'

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By Daniel Taylor, Esq. on October 14, 2014 9:10 AM

Alongside the many well-known benefits of using a credit card to make purchases -- being able to pay over time, earning airline miles, or other rewards -- credit cards also offer unique protections for consumers who may feel like they didn't get what they bargained for in a purchase.

Credit card companies are generally obligated by state and federal law to offer customers chargebacks for disputed charges. Chargebacks function as a refund for purchases made by consumers who have a valid dispute as to the charges associated with the purchase.

How do chargebacks work?

Chargebacks for 'Billing Errors'

Consumers who have a "billing error" on their credit card statement may be eligible for a chargeback. Under federal law, billing errors include the following:

  • Unauthorized charges;
  • Charges for goods that were different from what was purchased;
  • Charges for goods that were never delivered; and
  • Charges for goods that were delivered late.

This means that a chargeback cannot be requested for goods that a consumer simply wishes that he or she hadn't purchased. Rather, chargebacks allow consumers to request refunds for purchases that failed to conform to the terms of the transaction or that were erroneously charged to the consumer.

How to Request a Chargeback for a Billing Error

Consumers who wish to request a chargeback must write to the creditor using the address provided on the credit card billing statement for "billing inquiries" (which will not be the same address to which payments are sent) describing the nature of the billing error. The letter must reach the creditor within 60 days after the first bill on which the error appeared was mailed to you. The Federal Trade Commission recommends that this letter be sent by certified mail.

The consumer is not obligated to attempt to resolve a billing error dispute with the retailer before requesting a chargeback for a billing error, although the creditor may request that you return any merchandise before receiving a credit refund.

Requesting a 'Claims and Defenses' Chargeback

In addition to requesting chargebacks for billing errors, consumers who wish to dispute charges based on the quality of goods or services may do so as well -- but these chargebacks, called "claims and defenses," are governed by additional rules.

Unlike billing errors, claims and defenses can be filed up to one year from the time of purchase. However, these claims can only be made on goods with a value of over $50 that were purchased within 100 miles of the consumer's home. And unlike with billing errors, consumers must first attempt to resolve a "claims and defenses" dispute with the retailer.

Need More Help?

If you need help with credit card charges or dealing with other debt issues, a debtor-creditor lawyer can advise you on your legal options.

Are you facing a legal issue you'd like to handle on your own? Suggest a topic for our Legal How-To series by sending us a tweet @FindLawConsumer with the hashtag #HowTo.

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