How To Use The Fair Credit Billing Act FCBA To Your Advantage
Below is a MRR and PLR article in category Finance -> subcategory Credit.
How to Leverage the Fair Credit Billing Act (FCBA) for Your Benefit
Summary:
Ever been billed for items you returned or never received? Here's how the Fair Credit Billing Act (FCBA) can help you resolve these issues.Understanding the FCBA
Have you ever been overcharged or not credited for a payment on your credit card? Such mistakes can be corrected with the right approach and some knowledge of the Fair Credit Billing Act (FCBA).
What the FCBA Covers
The FCBA is designed for "open end" credit accounts, like credit cards and revolving charge accounts, for example, department store accounts. It does not apply to installment loans, which include car loans, furniture, and major appliances bought on an installment plan.
Types of Disputes Covered
The FCBA's procedures focus on correcting "billing errors," including:
- Unauthorized charges, with a liability limit of $50.
- Incorrect dates or amounts listed on charges.
- Charges for undelivered or unaccepted goods and services.
- Mathematical errors.
- Failures to post payments and credits on time.
- Bills sent to incorrect addresses if you provided a change of address in writing at least 20 days before the billing period ends.
- Charges lacking a requested explanation or necessary documentation.
Steps to Utilize FCBA Protections
To benefit from the FCBA, you should:
1. Write to the Creditor: Use the address specified for "billing inquiries," not for payments. Include your name, address, account number, and a clear description of the error.
2. Timing: Ensure your letter reaches the creditor within 60 days of receiving the bill with the error.
3. Documentation: Send your letter via certified mail, return receipt requested to have proof of receipt. Attach copies of any supporting documents, like sales slips, and keep a copy of your complaint letter.
The Creditor’s Responsibility
Upon receiving your complaint, the creditor must acknowledge it in writing within 30 days unless already resolved. The creditor then has two billing cycles (not exceeding 90 days) to investigate and resolve the issue.
During the Dispute
While the error is being investigated:
- You can withhold payment on the disputed amount and related charges.
- You must continue to pay the undisputed portion, including its finance charges.
- The creditor may not initiate legal action to collect the disputed amount during this time.
- Your account cannot be closed or restricted, but the disputed amount can count against your credit limit.
Impact on Your Credit Rating
While the dispute is ongoing:
- Your creditor cannot report you as delinquent or threaten your credit score.
- They can note that you are contesting the bill.
- The Equal Credit Opportunity Act protects you from being discriminated against by creditors for exercising your rights under the FCBA, ensuring your credit applications are unaffected by such disputes.
Use these guidelines to effectively manage billing errors, ensuring that your credit remains in good standing while you work through discrepancies.
You can find the original non-AI version of this article here: How To Use The Fair Credit Billing Act FCBA To Your Advantage.
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