Fair Credit Billing Act (FCBA)

Key takeaways

• The FCBA protects consumers with open-end credit (credit cards, charge accounts, lines of credit) from billing errors and unauthorized charges.
• Consumers generally have 60 days from the date a statement is mailed to dispute a billing error in writing (phone disputes allowed for lost/stolen cards).
• Creditors must acknowledge disputes within 30 days and resolve them within 90 days; disputed amounts cannot be collected, charged interest for, or reported late during investigation.
• Liability for unauthorized charges is capped at $50 under the FCBA, though many card issuers offer zero-liability policies.
• The FCBA covers billing practices; the Fair Credit Reporting Act (FCRA) governs how credit information is collected and shared.

What the FCBA covers

The FCBA applies to open-end credit accounts, including:
* Credit cards and charge cards
* Lines of credit and similar revolving accounts

It protects consumers from common billing problems such as:
* Unauthorized charges
* Incorrect dates or amounts
* Charges for goods or services not received or not as described
* Calculation errors
* Billing statements sent to the wrong address
* Charges that require clarification

Note: The FCBA does not apply to closed-end credit (e.g., auto loans, mortgages, home equity loans).

Consumer rights and how to dispute a charge

• Time limit: You generally have 60 days from when a billing statement is sent to submit a dispute.
• Dollar threshold: The FCBA applies to billing errors above $50.
• Method: Disputes must be submitted in writing except when a card was lost or stolen, which may be disputed by telephone.
• Payment during dispute: You may withhold payment only for the disputed amount while the creditor investigates — not the entire bill.
• Unauthorized-use liability: Cardholder liability for unauthorized card use is limited to $50 under the law; many issuers offer zero-liability policies.
• Challenging results: If you disagree with the creditor’s findings, you generally have a short window (commonly 10 days) to contest the outcome and request further review.

Practical tips:
* Send written notice to the address your billing statement lists for inquiries.
* Keep copies of your dispute, supporting documents, and delivery confirmation.

Obligations of card issuers and lenders

• Acknowledgment: Creditors must acknowledge receipt of a billing complaint within 30 days.
• Investigation: They have up to 90 days to investigate and must resolve the dispute within that period.
• Restrictions during investigation: The creditor cannot try to collect the disputed amount, charge interest attributable to it, or report it as late to credit bureaus (it may report that the item is “in dispute”).
• Outcome: If the creditor finds in your favor, it must correct the error and refund fees or interest tied to the error. If it finds the dispute invalid, it must explain the decision and provide supporting documentation.

Special situations and definitions

• Account in dispute: The term typically refers to the 90-day investigation period during which the creditor reviews the claim and must either remedy the error or explain why it is not considered valid.
• Non-refundable charges: You may still dispute a non-refundable charge if you have a valid claim (for example, services not provided or charges you did not authorize).
• Chargeback: A chargeback is the reversal of a disputed credit transaction that returns funds to the cardholder after a successful dispute.

Effect on credit reports and scores

Filing a billing dispute does not directly affect your credit score. However, creditors may report that an item is “in dispute” to one or more credit bureaus while investigating; that notation can appear on your credit report temporarily.

FCBA vs. FCRA

• FCBA: Protects consumers from unfair billing practices and provides a dispute process for billing errors on open-end credit accounts.
• FCRA: Regulates the collection, use, and sharing of consumer credit information and governs how credit reporting agencies handle credit files.

Bottom line

The Fair Credit Billing Act gives consumers a structured way to challenge unauthorized charges and billing errors on credit cards and other open-end accounts. Acting promptly — typically within 60 days — and submitting disputes in writing (unless the card was lost or stolen) triggers legal protections that limit collection and reporting of disputed amounts while creditors investigate. Knowing your rights under the FCBA can help you resolve billing problems and limit financial liability.