Tips to help consumers with disputes on credit card charges

Consumers are paying close attention to all aspects of their finances these days. Plunging investments. Falling home values. And, erroneous credit card charges. When the latter are discovered, many consumers file disputes with their card issuers.

No industry statistics are available about how often such disputes are won by consumers. But to maximize their chances, consumers should know how to navigate the maze of rules governing credit card disputes.

Under federal law, "You're entitled to an investigation (of the dispute) but not entitled to a particular result," says Chi Chi Wu, staff attorney at the National Consumer Law Center.

Mike Gaynor of Chicago says he's become an unwilling expert after spending almost 10 months and more than 100 hours fighting credit card charges.

In May, Gaynor, 44, and his wife, Kerry, 39, filed a dispute with Citibank for $130,000 — an amount that has since been revised to $46,000 — after he failed to get rugs, couches and design services purchased from an interior designer. Some of the furnishings were delivered after he filed the dispute, but Gaynor said he took Citibank's advice and refused them because their delivery was extremely late. He had already bought other furnishings.

The dispute dragged on for months before MasterCard stepped in. MasterCard decided in favor of the merchant, his bank told him in a letter, because he refused delivery of the order.

Gaynor says Citibank is working with him to locate some furnishings and is considering giving him a credit for others. But that, while helpful, won't dispel his anger.

MasterCard declined comment on the consumer's case. Generally, the card association steps in only when banks can't resolve the matter and never has "preferences in the outcome," says Chris Monteiro, a MasterCard spokesman.

Citibank spokesman Samuel Wang said the bank is "working with these customers … toward a complete resolution."

Whether the issuer decides in favor of the bank or the consumer depends on whether it's a valid claim and what type of documentation each side has, says Nessa Feddis, a vice president at the American Bankers Association, a trade group.

While it's not always possible to avoid credit card disputes, here are some tips for dealing with them:

•Get promises in writing. Save receipts. For big-ticket items, also ask for written confirmation of when the item will be delivered and what services are provided as part of the purchase.

•Know the rules. The Fair Credit Billing Act gives consumers the right to dispute a credit card purchase or withhold payment for a card purchase — but only under certain conditions.

Disputes must generally be filed in writing within 60 days after the bill is sent. In certain disputes, the goods or services must cost more than $50, and the transaction must have occurred in the purchaser's home state or within 100 miles of his or her mailing address. Although state laws vary, items bought online or by phone are generally considered purchases made where you are, Feddis says.

While disputing a charge, the card holder will not have to pay the contested amount and won't incur interest on it. If the dispute is lost, the card company is allowed to charge interest back to the date you filed the dispute, after a standard grace period.

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