What are my rights with credit card companies?

credit card rightsCredit cards are wonderful little pieces of plastic that can be lifesavers in an emergency. They are an extension of future funds provided by companies that allow you to spend that future money now and pay back later. As with any company, they and you both have rights and obligations outlined in a contract. Read further to know your rights when dealing with credit card companies.

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Credit cards can be a double-edged sword. They can provide that much-needed safety net in times of financial crises, or they can create a monetary backlash that can last for years.

What is the credit card company required or allowed to do?

Before being issues any cards, the company and the customer must have an agreement (contract) in place. This contract outlines the rules and responsibilities of both parties. Be sure to read this in its entirety even if the ultra fine print gives you a headache.

Credit card companies are legally required to provide their customers with a 45-day written notice of any interest rate increases. This allows time for you to pursue other options of credit with possibly lower rates.

In the past, a credit card company was allowed to raise or change the credit card interest rates based on the rate of other cards held in your name, called a universal default. This is no longer allowed. Companies can only apply an interest rate based on your use of their card.

What rights do I have when dealing with my credit card company?

Many people feel overwhelmed when dealing with large corporations. Put your credit card purchase dispute in writing and mail it to the credit card company. It will be forwarded to the appropriate department, and then they will contact you. If you do not hear from them within seven to ten days, make the effort to follow up with a phone call.

When dealing with a credit card company, remember that as a customer you have the right to be treated fairly and honestly, as is stated in the initial credit card contract that you signed when you first applied for your card.

The Fair Credit Billing Act (FCBA) of 1974 was developed to provide a written statement of credit card holder’s rights. The FCBA outlines the legal rights of consumers when having to deal with banks, credit card companies, and other similar financial institutions that deal with the public. Some of your rights are as follows:

  • If you fall behind on your credit card payment, the collection department might deem it necessary to give you a reminder by phone. However, under the fair debt collection laws, no creditor is allowed to contact your at your place of work if your company has a policy in place that states such calls are prohibited. You may need to send them a copy of the company policy along with a cease and desist letter. If they continue to call you at work, they can be sued for harassment.
  • Double billing cycles are no longer allowed. In the past, finance charges were computed based on more than one billing cycle. This slapped a penalty on the consumers when they carried a balance in previous months, even if that balance was paid off in the most recent month.
  • Consumers cannot be charged a fee when paying their bill via phone. According to the Credit Card Accountability, Responsibility and Disclosure (CARD) Act, when using a regular process to pay your bill, credit card companies cannot tack on a surcharge. However, they can still charge you for any expedited service via phone or regular mail.

What are my responsibilities as a credit card customer?

It is your responsibility to review every item on every single statement that you receive. Make sure that you can account for every transaction that is listed and that the amounts of those transactions are correct.

If any errors are evident on your statement, contact the credit card company immediately. Do not wait! The longer you wait, the more difficult it becomes to contest those charges. Credit card companies typically have a 30 to 60-day window of opportunity for you to oppose any fraudulent credit card charges. If you miss that window, you may not be able to have them removed.

For more detailed information on credit card rules and regulations, visit the Federal Trade Commission’s website.

People can spend thousands of dollars a year on interest alone. Your credit score plays a huge role in determining that rate. Be aware of what your credit score is. You can check your credit score once a year for free at AnnualCreditReport.com.

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Disclaimer: This content is not provided or commissioned by American Express, Visa, MasterCard, Discover, or any other credit card company or issuer. The opinions expressed here are the author's alone, not those of any credit card company or issuer, and have not been reviewed, approved or otherwise endorsed by any credit card company or issuer. Credit Card Chaser may be compensated through various affiliate programs with advertisers. As always, Credit Card Chaser is an independent website commmitted to helping people research credit card offers and find the best credit card!