What Does Disputing a Charge Mean and How Does It Work

Disputing a charge means formally asking your bank or card issuer to reverse a transaction on your statement that you believe is wrong, unauthorized, or tied to a purchase the merchant failed to honor. Two federal laws do the heavy lifting: the Fair Credit Billing Act for credit cards and the Electronic Fund Transfer Act for debit cards. Together they cap your liability for unauthorized credit card charges at $50 (most issuers waive even that),¹ require your issuer to investigate, and bar it from collecting the disputed amount while that investigation runs.

When You Can Dispute a Charge

Federal law treats a wide range of problems as “billing errors” your issuer has to investigate. The usual reasons fall into a few groups.

Unauthorized transactions. A charge you didn’t make or approve — from a stolen card number, a data breach, or someone using your account — is unauthorized. Credit card liability is capped at $50 by statute,¹ and most major issuers offer zero-liability policies on top of that.

Billing errors. Double charges, wrong amounts, and charges for a service you canceled are classic billing errors the Fair Credit Billing Act requires your issuer to correct once confirmed.²

Goods not delivered or not as described. If the merchant never shipped what you paid for, or what arrived is broken or materially different from what was advertised, that’s a dispute. The statute specifically covers goods “not delivered to the obligor in accordance with the agreement made at the time of a transaction.”²

Quality complaints on a credit card come with an extra step. If your issue is about the quality of goods or services rather than a straight billing mistake, federal law requires a good-faith attempt to resolve it with the merchant first. The purchase also has to exceed $50 and have been made in your home state or within 100 miles of your billing address. Those geographic and dollar limits fall away if the merchant and the issuer are the same company or are affiliated.³

ATM and electronic transfer errors. Debit disputes aren’t limited to point-of-sale purchases. ATMs dispensing the wrong amount and electronic transfers posting incorrectly are errors under Regulation E, and your bank has to investigate them the same way.⁴

Deadlines and Liability Limits

How much you can be on the hook for, and how long you have to speak up, depends on which card was used.

Credit Cards

Your maximum liability for unauthorized charges is $50. You must send written notice of a billing error within 60 days of the statement that first showed the charge.⁵ While the investigation runs, the issuer can’t collect the disputed amount, charge interest on it, or report you as delinquent for not paying it.⁶ You still owe the rest of your bill.

Debit Cards

Debit liability is tiered and tightens quickly:

Reported within 2 business days of learning about the loss: liability capped at $50.
Reported after 2 business days but within 60 days of your statement: liability can reach $500.
Reported after 60 days: you can be responsible for all unauthorized transfers that happen after the 60-day window closes and before you notify the bank.⁷

Those tiers are why debit card statements are worth reviewing promptly. A delay that would cost you nothing on a credit card can cost you hundreds on a debit card.

How to File a Dispute

The Fair Credit Billing Act technically requires written notice sent to the issuer’s billing-inquiry address — not the payment address — within 60 days of the statement date.⁵ Most issuers also accept disputes through their websites or mobile apps. If you want the strongest legal protection, a letter sent by certified mail gives you proof of delivery. The FTC recommends including copies of supporting documents and keeping the originals.⁸

Your notice should include your name, account number, the specific charge, the dollar amount, and a clear explanation of why it’s wrong. Useful supporting evidence includes:

Receipts, digital or printed, showing the price or item actually purchased.
Shipping and tracking records proving a product was never delivered or was returned.
Emails, chat logs, or a written log of phone calls (names, dates, what was said) showing you tried to resolve the problem with the merchant.
Photos or screenshots of damaged goods or of a service description that doesn’t match what you received.

For a credit card quality-of-goods dispute, expect the issuer to ask for proof you contacted the merchant first; it’s a statutory precondition for those claims.³

What the Bank Must Do

Credit Card Investigations

Once your issuer receives the written notice, it must acknowledge your dispute in writing within 30 days unless it resolves the matter in that window. From there it has up to two billing cycles, and no more than 90 days, to finish investigating and either correct your account or send a written explanation of why the charge stands.⁵ It also can’t close or restrict your account just because you’re not paying the disputed charge.

Debit Card Investigations

Under Regulation E, your bank has 10 business days to investigate. It can extend to 45 calendar days, but only if it provisionally credits your account for the disputed amount within those first 10 business days. For point-of-sale debit transactions, the extended window reaches 90 days.⁴

How Disputes End

If the investigation confirms the error, the issuer must correct your account. On a credit card, that means removing the charge and crediting back any interest or fees that accrued on it.⁵ On a debit card, any provisional credit becomes permanent. You get written confirmation either way.

If the issuer finds the charge accurate, it has to tell you in writing, explain why, and tell you how much you owe. You can request copies of the documents it relied on.⁸

Filing a dispute itself doesn’t hurt your credit score. The credit bureau will usually note that the account is in dispute and leave the disputed amount out of the score calculation while the investigation is open.⁹ Some lenders may hold off on extending new credit while a dispute is pending. If the dispute is resolved against you and you don’t pay, the issuer can then report the debt normally.

If Your Dispute Is Denied

A denial isn’t the end. Under the Fair Credit Billing Act you can appeal by writing to the issuer and stating that you still dispute the charge. The appeal has to go in by the payment deadline the issuer gives you or within 10 days of receiving the written explanation, whichever is later.⁸

Once you appeal, the issuer can begin collection and may report the amount as delinquent. It must also report that you still dispute the charge, and once the matter is finally resolved it must promptly notify everyone who received the delinquency report.⁸

If the bank still won’t resolve the problem, you can file a complaint with the Consumer Financial Protection Bureau online or by phone at (855) 411-2372. The CFPB forwards your complaint to the company, which generally has 15 days to respond and up to 60 days for a final response. Your complaint and the response become part of the CFPB’s public Consumer Complaint Database.¹⁰

A Warning About False Disputes

The dispute process is a consumer protection, not a refund shortcut. Filing a chargeback you know is false, sometimes called “friendly fraud,” can get the credit reversed, your account closed, and you blacklisted by the issuer. It can also be a crime. Fraudulent use of a credit card, including obtaining goods or money through false claims, can carry fines up to $10,000 and up to 10 years in federal prison.¹¹ If you have a legitimate complaint, file it; if you’re not sure, call the issuer and talk through the facts before you submit anything in writing.

1
Office of the Law Revision Counsel. 15 USC 1643 – Liability of Holder of Credit Card
2
Office of the Law Revision Counsel. 15 USC Chapter 41 Subchapter I Part D – Credit Billing
3
Office of the Law Revision Counsel. 15 USC 1666i – Assertion by Cardholder Against Card Issuer of Claims and Defenses
4
Consumer Financial Protection Bureau. Regulation E 1005.11 – Procedures for Resolving Errors
5
Office of the Law Revision Counsel. 15 USC 1666 – Correction of Billing Errors
6
Consumer Financial Protection Bureau. Can They Charge Me Interest on a Charge I Did Not Make?
7
Office of the Law Revision Counsel. 15 USC 1693g – Consumer Liability
8
Federal Trade Commission. Using Credit Cards and Disputing Charges
9
Consumer Financial Protection Bureau. If I Dispute a Debt, How Does That Show Up on My Credit Report?
10
Consumer Financial Protection Bureau. Submit a Complaint About a Financial Product or Service
11
Office of the Law Revision Counsel. 15 USC 1644 – Fraudulent Use of Credit Cards and Penalties