How to Dispute & Chargeback Credit Card Transactions

When you’re on a tight budget and a purchase goes wrong, it can be a bad feeling since you may not be able to afford to buy the product again. Luckily, there is one option you can use to dispute the purchase on your credit card with your bank to get a refund. Sometimes to properly save money you simply need to make sure that you don’t get scammed when you do make purchases.

When a vendor won’t willingly give you a refund on a credit card purchase and you didn’t receive what you paid for, you’re entitled to get your money back. When you file a chargeback case with your credit card company, they’ll dispute the transaction for you to get your refund.

What are Disputes & Chargebacks?

When you buy something with a credit card or even a debit card, you actually receive buyer protection with your purchase. This is a service that all banks and credit card companies offer free of charge to customers, even though many people may not know it exists.

Maybe you buy a product online and wait for a month but never receive it. Perhaps you purchase an item and you’re shipped the wrong product, so you didn’t ultimately receive what you bought. Sometimes sellers lie about what they’re selling, and you don’t realize it until you actually get to use what you purchased. If a fragile item is shipped to you and breaks during transit, you’ve also lost out and didn’t receive what you bought.

When a seller doesn’t fulfill a purchase, either through their own willful neglect or through no fault of their own, a customer is entitled to a refund. If the vendor won’t provide this refund willingly then a customer can go to their bank to file a dispute and chargeback the purchase to get their money back.

There are time limits when it comes to chargebacks though. This time limit can vary for each credit card company. However, it’s usually 60 days. There are some companies that offer up to 180 days of protection. Once you pass your time limit, you won’t be able to file a dispute anymore, so make sure you don’t let bad purchases wait too long before you take action.

Communicate With Seller

When you have a problem with something you purchased, do not run straight to your bank to file a chargeback. You must make an attempt to reach out to the seller and communicate with them first. Not only is this highly recommended, but it’s also a requirement to file most chargebacks.

Most sellers will respond positively and want to correct the problem to keep you satisfied. Give them this opportunity to see how they will react to a bad situation. They may just surprise you with excellent customer service. Especially when you buy things online, there are often problems that can be beyond a seller’s control, like shipping damage. For this reason, try to give them the benefit of the doubt and give them a chance to correct the problem first.

If you unsatisfied with the seller’s response or if they will not respond to your messages after a few days, then you are well within your rights to go to your bank to file a dispute. They’ll usually ask you if you’re attempted to communicate with the seller. Any messages you have with the seller can also be excellent evidence to use in the chargeback case.

File Chargeback Case

Depending on your bank or credit card company, you may be able to login to your online account to file a chargeback on a specific transaction. If you’re unable to find this option within your online account, just call their customer service number.

Describe your problem with the purchase in as much detail as possible. Mention what you were supposed to receive, and what you actually received. The more information you can provide during this step, the more likely you will be to win the case.

Once you file a case, it can sometimes take a month or two to get a resolution and ultimately receive a refund back to your account. Cases can go quickly if a seller chooses to award the case to you. If they fight it, you could easily wait two months and sometimes a bit more. This is one reason why it can be best to contact the seller first to see if they will correct the problem without a fight.

Provide Case Evidence

When you’re opening a dispute, your bank will ask you to upload files to provide evidence for the case. Anything you can give them that helps to prove that you didn’t receive what you purchased can be a huge help.

If you bought from a website and your order status page with them still states that it hasn’t shipped, take a screenshot of it and use it as evidence. The same goes with communications with the seller. When you attempt to get a refund before a chargeback is filed, the messages you receive from the seller may potentially be able to help your case.

Damaged items that you’ve received should be thoroughly documented with pictures. When you can show the item damaged, still in the box and the box itself has damage too, those are especially helpful photographs. When you buy from a website, they’ll likely have policies that govern their shipping and refund rules. Sometimes that information can be beneficial to you, so be sure to include it for your case if it contains useful policies that back up your case.

Vendors & Chargebacks

One final thing I want to talk about before I conclude this guide is whether you should file a chargeback or not. Do not abuse or try to take advantage of this system – it can cause you more harm than good. Also, try to avoid filing a chargeback unless a seller simply leaves you no choice by refusing to correct a problem.

When you file a chargeback against the vendor with your credit card company, that vendor will actually end up getting charged an additional fee for the dispute. This fee is typically $30-$35 per transaction, and it doesn’t matter what the amount of the transaction. You could purchase a $5 item online and file a chargeback on it. That seller would lose the $5 from the purchase and then charged an additional $30-$35 fee on top of the refund amount. This means you can easily end up losing a lot of money as a seller if you have a lot of chargebacks.

Consider this information before you decide to proceed with a dispute. Again, reach out to the seller to resolve the problem first. When all else fails, let them know you don’t want to but will have to file a chargeback to get a resolution. Wait a few hours after sending that message before you file. Sometimes the seller will quickly change their mind once they realize you will file a dispute, since that will simply cost them more money in the long run.