Credit portal




How to Respond to Credit Card Billing Errors

how does credit card billing work

By LaToya Irby. Credit/Debt Management Expert

Welcome to's Credit/Debt Management site, led by your guide, LaToya Irby. LaToya has been the credit and debt management guide since 2007. Read more

Do you know how to handle credit card billing mistakes like when returned merchandise isn’t credited back to your credit card account? Or a recent payment isn’t reflected in your credit card balance? The Fair Credit Billing Act, a Federal law, gives you the right to dispute credit card billing errors.

When You Discover a Billing Error

Technically, you can make the dispute over the phone, but the law doesn’t require the creditor to respond. The creditor can continue to collect on the charge and even take action on late payments if you refuse to pay.

Instead of telling a customer service representative over the phone, you should send your dispute in writing within 60 days of receiving the billing statement with the error. Your billing error dispute letter should include your name, address, account number, and details and amount of the error.

If you have proof supporting your claim, it’s a good idea to include a copy of it with your dispute (keep the original for your own records). Send the letter via certified mail with return receipt requested so you have proof the letter was mailed and received.

You must mail your dispute to the address the creditor provides for billing disputes. Don’t send your dispute to the same address that you send your payment unless your billing statement specifically says so. If you’re not sure to what address you should send your dispute, call your creditor’s customer service line and ask.

Continue Reading Below

The Creditor’s Response

Once the card issuer receives your dispute, they have 30 days to send acknowledgment of your dispute letter. Of course, since you mailed your letter with return

receipt requested, you’ll already know the creditor got it. Next, the creditor has two billing cycles, but not more than 90 days, to do one of the following:

  • Correct the bill and credit any finance charges. late fees, or other fees that were charged.
  • Or, let you know why the bill is correct along with the amount you owe and an explanation for the amount owed.

If the creditor determines there was no billing error, you then have 10 days to make the payment specified or to re-dispute the error. At this point, the creditor is allowed to collect on the payment and even use a debt collector. You have the right to request documentation supporting the creditor’s claim.

Credit Bureau Reporting of Disputed Charges

After making your dispute in writing, you are not responsible for paying the disputed amount until the creditor has responded saying there was no billing error. Before that time, the creditor cannot put any negative information on your credit report regarding the disputed charge even if you don’t pay it.

If the creditor does report the nonpayment to a third-party after investigating and finding there was no error, it must also report that you have disputed the amount. The creditor also has to notify you that the delinquency has been reported and give you the name and address of anyone to whom the information has been reported.

When Does the FCBA Apply

The Fair Credit Billing Act applies to open-ended, revolving accounts like credit cards and lines of credit. It doesn’t apply to closed-ended loans like mortgages and auto loans.

Government Regulation

If you're unable to resolve the billing error with your credit card issuer, you can complain to the Consumer Financial Protection Bureau. The CFPB may help you and the card issuer reach a more favorable resolution.

Category: Bank

Similar articles: