How to Cancel a Charge on Your Credit Card

When an unfamiliar or incorrect charge appears on a credit card statement, consumers have rights and protections under federal law to address such discrepancies. Understanding these steps helps resolve issues effectively and maintain financial well-being.

Recognizing Disputable Charges

Credit card charges eligible for dispute fall into several categories, protecting consumers from errors or unauthorized activity. One common reason is an unauthorized transaction, such as charges from fraudulent use of a compromised card. Federal law generally limits a cardholder’s liability for unauthorized charges to $50.

Another category involves incorrect amounts, where the charge on the statement differs from the agreed-upon price, or if duplicate billing occurs for a single purchase. Charges for goods or services not received, or those that are defective, misrepresented, or not delivered as agreed, also constitute a valid reason for dispute. Additionally, if a subscription or service was canceled but charges continued, this can also be disputed.

Preliminary Steps Before Formal Dispute

Before initiating a formal dispute with a credit card issuer, cardholders should take preparatory steps. Begin by thoroughly reviewing the credit card statement to confirm the details of the charge, including the merchant name, transaction date, and amount. This initial review helps ensure the charge is disputable and not a forgotten or misidentified legitimate purchase.

Contacting the merchant directly is often the recommended first action. Many billing errors can be resolved quickly by the merchant. When contacting the merchant, gather all relevant information, including receipts, order confirmations, and prior communication.

Document all efforts made to resolve the issue with the merchant. This includes noting the dates and times of calls, the names of representatives spoken with, and summaries of conversations. Keeping copies of emails, chat transcripts, or other written correspondence provides evidence if a formal dispute becomes necessary.

Formalizing Your Dispute with the Card Issuer

If attempts to resolve the issue directly with the merchant are unsuccessful, the next step involves formalizing the dispute with the credit card issuer. This process initiates a “chargeback.” Cardholders can contact their credit card issuer through various methods, including phone, online portal, or mail.

When contacting the issuer, provide specific details about the charge. Include the merchant’s name as it appears on the statement, the transaction date and amount, and a clear reason for the dispute. Any documentation of prior communication with the merchant should also be provided to support the claim.

Adhering to time limits for filing disputes is important. Under the Fair Credit Billing Act (FCBA), consumers have 60 days from receiving the statement with the error to dispute a charge in writing. Meeting this 60-day requirement ensures federal protections.

What Happens After Filing a Dispute

Once a formal dispute is filed, an investigation process begins. The card issuer reviews the cardholder’s claim and contacts the merchant for their side and supporting evidence. During this investigation, the cardholder may receive a provisional credit for the disputed amount. This temporary credit allows access to funds while the claim is under review, but it can be reversed if the dispute is denied.

The credit card issuer must acknowledge the dispute within 30 days and has two billing cycles, or up to 90 days, to complete the investigation. During this period, the cardholder is not required to pay the disputed amount, and the issuer cannot report it as delinquent to credit bureaus or charge interest on it. However, the cardholder remains responsible for any undisputed portions of their bill.

The merchant has an opportunity to respond with evidence to validate the charge. If the issuer finds the merchant’s evidence compelling, the dispute may be denied, and the provisional credit will be reversed. If the investigation concludes in the cardholder’s favor, the disputed charge is permanently removed, and any provisional credit becomes permanent. The issuer communicates the final decision in writing.