How to Handle Billing Errors

A few months back Chase offered me a balance transfer deal. I could transfer $1900 at 5.9% APR fixed for the life of the balance with no balance transfer fees. After carefully examining the terms of the offer, I took it.

I knew that I had to put this card out of sight and out of mind until this balance was paid off. The regular APR was around 29.99%. There was also a clause that stated payments would go towards the lowest interest balance first. That means that any purchase I made from now on would be have a finance charge of almost 30% until I could pay off the rest of the balance. No thanks!

The first month was great. My finance charge was less than $10 because my entire balance was transferred at the promotional rate of 5.99%.

Then the second month bill came. Somehow a few bucks slipped into the 29.99% APR range. It only made a slight increase in my finance charge so I wouldn't have noticed it... if I wasn't watching my bills like a hawk. I hadn't made any new purchases. What was this all about? Maybe they were considering my finance charges a 'new purchase'. Could they do that? This doesn't seem fair. I felt defeated because the great deal I thought I had was a wolf in sheep's clothing. By the time I got the next bill I felt angry. This isn't fair! The terms said fixed at 5.99%!

I called Chase. After speaking to several representatives, going through the previous few months statements, someone finally agreed that there was a mistake. The next bill had a credit for the difference in finance charges and I haven't seen a balance under new purchases since. The $0.67 credit wasn't a big deal, but if I had let this go on it would have added up quickly.

What can you do if there is a billing error on your credit card statement?

In my case the mistake was in the finance charge calculation. The federal Fair Credit Billing Act covers billing errors. According to the federal reserve, examples of billing error are:

• A charge for something you didn’t buy
• A bill for an amount different from the actual amount you charged
• A charge for something that you did not accept when it was delivered
• A charge for something that was not delivered according to agreement
• Math errors
• Payments not credited to your account
• A charge by someone who does not have permission to use your credit card

My error was resolved with a phone call. If that doesn't work for you, write a letter within 60 days of receiving the statement with an error. Use the address for “billing inquiries” listed on the bill. Make sure to include your name and account number plus the date, amount and a description of th error. They say to pay all other parts of the bill, but I would pay all of it, just in case.

According to the federal reserve website:

If there is an error, you will not have to pay any finance charges on the disputed amount. Your account must be corrected.

If there is no error, the credit card company must send you an explanation and a statement of the amount you owe. The amount will include any finance charges or other charges that accumulated while you were questioning the bill.

If you have a problem involving your credit card, first try to resolve it directly with the store or the credit card company. If that doesn’t work, you may want to file a complaint with your state’s attorney general or banking agency. You may also file a complaint with the federal agency responsible for enforcing consumer credit laws for your credit card company.

Credit cards issued by state banks that are members of the Federal Reserve System

Federal Reserve Consumer Help
PO Box 1200
Minneapolis, MN 55480
888-851-1920 (Phone)
877-766-8533 (TTY)
877-888-2520 (Fax)
Email:ConsumerHelp@FederalReserve.gov
www.FederalReserveConsumerHelp.gov

See “How to File a Consumer Complaint about a Bank”.

Credit cards issued by banks with “national” in the name or “N.A.” after the name
Comptroller of the Currency
Office of the Ombudsman
Customer Assistance Unit
1301 McKinney Street, Suite 3450
Houston, TX 77010
1 (800) 613-6743 (toll-free)
www.occ.treas.gov

Credit cards issued by state banks that are not members of the Federal Reserve System
Federal Deposit Insurance Corporation
Consumer Response Center
2345 Grand Boulevard, Suite 100
Kansas City, MO 64108
1 (877) 275-3342 (toll-free)
www.fdic.gov

Credit cards issued by federal savings and loan associations and federal savings banks
Office of Thrift Supervision
Consumer Programs
1700 G Street, NW
Washington, DC 20552
1 (800) 842-6929 (toll-free)
www.ots.treas.gov

Credit cards associated with federal credit unions
National Credit Union Administration
Office of External Affairs
1775 Duke Street
Alexandria, VA 22314-3428
(703) 518-6330
www.ncua.gov

Credit cards issued by finance companies or stores, and matters related to auto dealers, mortgage companies, and credit bureaus
Federal Trade Commission
Consumer Response Center
6th and Pennsylvania, NW
Washington, DC 20580
1 (877)-FTC-HELP (1-877-382-4357) (toll-free)
www.ftc.gov

Having debt does not mean you are an idiot. Don't let anyone take advantage of you. These companies are already making tons of money off of your mistakes, don't give them any freebies.

Read more:

• 7 Strategies to Reduce Finance Charges
• Tales from the Transferred Balances