How do I dispute a pen air charge?

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Have you ever paid for a product or service, but were unable to use it? For example, when companies declare bankruptcy or go out of business people are often unable to take advantage of pre-paid purchases, such as annual subscriptions and gift certificates. Online shopping also creates difficulties for many buyers who cannot simply go to the store and complain if they have a problem with their orders. However, by using your credit card for purchases, you have a remedy if you experience problems later.

Fair Credit Billing Act
Under the Fair Credit Billing Act you can dispute credit card charges for goods and services you never received and, under certain circumstances, for unsatisfactory goods or services that you did receive. This right is time-limited. The creditor must receive a letter from you within 60 days after the bill containing the charge is mailed to you. Many creditors allow you to file the dispute online or via phone too. The creditor has two billing cycles or 90 days, whichever is less, to investigate your claim. You do not have to pay the disputed portion of the bill while the creditor is researching the claim, but you still must pay any undisputed part.

If the creditor agrees with your dispute they will remove the charge from your bill and reverse payment to the merchant you bought the product or service from – called a chargeback. If the creditor disagrees with your dispute, they are required to send you a letter explaining why. At this point you must pay the disputed amount and any finance charges that have accrued, or you will be marked late on your credit report. To dispute the findings you must write to the creditor within ten days of receiving their letter.

Debit Cards
The Fair Credit Billing Act only applies to credit cards, not debit cards. However Visa and MasterCard offer the same chargeback service for debit cards transactions where you choose the “credit” option (as opposed to the “debit” option). Still, even though you can request a chargeback on some debit card transactions, there is an important difference between debit cards and credit cards. With a credit card you do not have to make the payment while the company is researching the charge. With a debit card the money is taken out of your checking account right away, and you have to wait to get your money back.

Responsible Use
Using a credit card provides extra protection, but try to avoid making purchases with your credit card if you do not have the money in your checking or savings account to pay off the balance in full the next month. The advantages of using credit cards can be quickly outweighed by the disadvantages if they are not used responsibly.

One of the benefits of using credit and charge cards is that they come with built-in consumer protection. A federal law called the Fair Credit Billing Act gives people who use “open end” credit accounts the right to dispute fraudulent and unfair credit charges. This law does not apply to installment contracts (loans) or debit cards.

How the Fair Credit Billing Act protects you
The Fair Credit Billing Act (FCBA) offers quite a bit of consumer protection for credit and charge card users, including:

• Your financial responsibility is limited to $50 if someone has used your credit account to make purchases without your permission.
• You do not have to pay for goods and services that you didn’t accept, were not delivered as agreed, or were not as promised.
• The creditor must credit you for merchandise that you returned.
• The creditor must send bills to your current address.

How to dispute a billing error
To dispute a charge, make sure you follow the process as outlined in the FCBA:

• Write a letter to the creditor and describe the billing error. Include your full name, account number, and receipts or documents you may have that support your position. Depending on the creditor, there may be an online or telephone dispute process as well.
• Make and keep copies of everything, and send your letter certified mail, return receipt requested, making sure it reaches the creditor within 60 days after the first bill with the error was mailed to you.
• The creditor must acknowledge your complaint in writing within 30 days after receiving your letter. They are required to resolve the dispute within two billing cycles after receiving your letter.
• Continue paying for any parts of the bill that are not in dispute to avoid being assessed penalties and charged interest.

During the investigation

• The creditor may report that you are challenging your bill.
• The creditor cannot take legal or collection action against you, threaten your credit rating, or report you as delinquent.
• If you apply for credit, a creditor can’t deny you because they see you are disputing a charge.

If the investigation finds that your bill does contain an error, the creditor will write you a letter explaining which corrections they will make to your account, and credit you with any finance charges, late fees or other error-related charges.

However, if the creditor finds the bill to be correct, you will be responsible for the disputed amount plus any accumulated finance charges, as well as the minimum amount you missed paying because of the dispute.

If you want to contest the results, write to the creditor within ten days of receiving the letter. Explain that you wish to continue disputing the charge. If you still see no results, and want to continue to fight the decision, you may file an appeal with the Federal Trade Commission at www.ftccomplaintassistant.gov or the Office of the Comptroller of the Currency at www.occ.treas.gov/customer.htm.