Maintaining Your Credit Rating. A creditor may not threaten your credit rating while you're resolving a billing dispute.
Once you have written about a possible error, a creditor must not release information to other creditors or credit bureaus that would hurt your credit reputation. And, until your complaint is answered, the creditor also cannot take any action to collect the disputed amount.
After the creditor has explained the bill, if you do not pay in the time allowed, you may be reported as delinquent on the amount in dispute, and the creditor may take action to collect. Even so, you can still disagree in writing. Then the creditor must report that you have challenged your bill and give you the name and address of each person who has received information about your account. When the matter is settled, the creditor must report the outcome to each person who has received that information. Remember that you may tell your own side in your credit record with a 100-word explanation.
Defective Goods or Services
Your new sofa arrives with only three legs. You try to return it; no luck. You ask the merchant to repair or replace it; still no luck. The Fair Credit Billing Act allows you to withhold payment on any damaged or poor-quality goods or services purchased with a credit card, as long as you have made a real attempt to solve the problem with the merchant.
This right may be limited if the card was a bank or travel and entertainment card or any card not issued by the store where you made your purchase. In such cases, the sale must have been for more than $50 and must have taken place in your home state or within 100 miles of your home address.
Prompt Credit for Payments and Refunds for Credit Balances
Some creditors will not charge a finance charge if you pay your account within a certain period of time, often called a grace period. In this case, it is especially important that you get your bills, and get credit for paying them, promptly. Check your statements to ensure that your creditor follows these rules:
Prompt Billing. Look at the date on the postmark. If your account is one on which no finance or other charge is added before a certain due date, then creditors must mail their statements at least 14 days before payment is due.
Prompt Crediting. Look at the payment date entered on the statement. Creditors must credit payments on the day they arrive, as long as you pay according to payment instructions, for example, sending your payment to the address listed on the bill.
Credit Balances. If a credit balance results on your account (for example, because you pay more than the amount you owe or you return a purchase and the purchase price is credited to your account), the creditor must make a refund to you. The refund must be made within seven business days after your written request or automatically if the credit balance still in exists after six months.
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