If you are NOT Satisfied with a Credit Card Purchase, YOU Have Rights!

In the United States, the Fair Credit Billing Act allows for consumer protection in the event of unsatisfactory purchases, and undelivered or misrepresented services/products. If you are unsatisfied with a purchase from a store, there are things you can do. If the merchant refuses to refund your money or replace the item, you may be able to take action against your credit card company. Your rights are established by law, but they depend on certain things, such as the purpose of your purchase (business or personal), how much the product cost, and how far from home you were when you made the purchase.

First, there are some factors regarding your purchase that must be considered to determine if the credit card company is legally liable:

  1. Type of card that you used - You must have charged the item by using the charge card issued by the store where you bought it or by using a bank card, rebate card, or travel card. Even if two stores are owned by a parent company, one store will not give you a refund for purchases made at another store (Gap will not refund your money for a purchase made at Old Navy, for example).
  2. Price of merchandise - If the merchandise was bought with a card notissued by the seller, then the product must cost more than $50. If you paid $49.99, you're out of luck, legally. Then the dispute is between you and the merchant, and the credit card issuer doesn't have to spend time resolving the matter.
  3.  Form and timing of complaint - You must complain in writing within 60 days after the first bill containing the error arrives. Some bank cards will intervene on your behalf even if you don't write them until after the time limit, but they may charge you an additional fee for doing so.
  4.  Location of transaction - The purchase must have occurred within your home state or within 100 miles of your billing address, unless the item was purchased with the seller's charge card. If you travel more than 100 miles from your billing address to make a purchase, your bank card doesn't legally have to become involved in your quest for a refund. However, many card issuers will waive this mileage rule. You just have to ask, politely. Catalogues, Internet sales, and phone orders may be considered in-state purchases, since information is sent to your home or the merchandise was advertised locally. State law may vary, but these purchases are generally protected. Overseas purchases are also frequently covered under consumer protection laws.


There are some circumstances underwhich the card company is not legally responsible. Some of these include:

  1. Business purchases - The card issuer has no responsibility for the transaction if a purchase was made for business purposes.
  2. If you've already paid for your merchandise - it won't help to contact your credit card company if the purchase is paid for already.. If a product is defective or stops working after it is paid for, your dispute is with the store and not with your card issuer. Your best course of action in this case is to contact the store, the manufacturer, and/or the service center.
  3. You sign a blank receipt - If you sign a blank credit card receipt before services are rendered, and the service provider determines that additional costs are necessary above and beyond what was quoted, you are still liable. Take your car mechanic for instance. If you sign a blank credit card authorization before final charges are tallied, and the mechanic determines that additional repairs are necessary above and beyond the initial estimate, you may still have to pay him. You have received a benefit for your payment, and you signed the authorization form.


Getting help for an unsatisfactory purchase

As we said, you do have purchase protections under the law. If you feel you were ripped off by a merchant, under US Federal law, you must first try to settle the matter by going directly to the merchant. If the company is still in business, you will need to show that you've made a good faith effort to resolve the matter. Keep records of all correspondence with the merchant, including notes on phone conversations and copies of letters.

If you can't resolve your problem with the merchant, write to the credit card company. This letter should be sent within 60 days of when the charge first appeared on your statement. The letter should include your name and account number, along with information about the unsatisfactory purchase (type of item, price, nature of dissatisfaction). You should also describe the steps you've taken to resolve the matter with the merchant. The card issuer will then conduct an investigation into the matter, and you may withhold payment on the unsatisfactory merchandise until the matter is resolved. Until that time, no interest or late fees will be charged.

If the card issuer's investigation reveals that you are right and the merchant is at fault, you will not have to pay for the item or for any finance charges. However, if you've already made payments on the defective merchandise, you won't get the money back, since card issuers can't retrieve money you've already paid.

If you receive an item you think is defective, don't pay the bill until you give the credit card issuer time to investigate. The payment is money that you'll never recover, even if the card issuer agrees that the merchant has sent you unsatisfactory merchandise.

If the credit card company does not believe the merchant is at fault, you will be expected to pay for the item. If you don't, you risk being sued, losing your credit rating, and having the card company turn your bill over for collection. You may choose to continue your dispute with the merchant by going to small claims court. While the dispute continues, you should send a letter to the credit bureaus explaining the apparent delay in your payment status.

Related Pages in Our Site: Using Credit Cards Properly | Pros and Cons of Credit Cards | Credit Card Basics


Disclaimer: We have built this resource with great care and expertise. We try to keep the articles current and up-to-date, but this isn't always possible given the ever-changing financial and lending markets. As such, DirectLendingSolutions.com provides no guarantees, and NO WARRANTY, expressed or implied, for the accuracy of any information provided, or its applicability to your financial situation. We strongly suggest that you consult your own financial advisor to determine the best course of action for your financial situation.