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Fair
Credit Billing Act
Fair Credit Billing
Act (FCBA) became effective in 1975. It only applies to open-end
credit transactions, such as credit card. Among other things, the
act specifies a step-by step procedure for correcting errors.
The procedure is as follows:
• The consumer must give
written notice of a billing error, in a letter, within 60 days of
receiving the bill in question.
• The creditor must respond
within 30 days and resolve the dispute within two billing cycles,
but not longer than 90 days. Within 90 days, the creditor must
either explain why the bill is correct or correct the error.
• During the resolution period no collection activity is
permitted on the disputed amount and no finance charges may be
collected as well. The account may not be reported as delinquent,
nor can it be closed (nor restricted) because of the consumer's
failure to pay the disputed amount, and/or related charges.
• If the consumer still believes the billing to be in
dispute after the resolution period, the consumer must again notify
the creditor in writing. During this period, the creditor may not
report the account delinquent without also reporting that the amount
is in dispute. The creditor must also report to the consumer the
name and address of each person to whom the creditor is reporting
information about the delinquency.
• The creditor must also
report how the matter was resolved, to anyone who received a report
on the delinquency.
• Creditors must include an address on
periodic statements to which consumer billing inquiries can be
addressed.
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