Stopping payment is an
incredibly powerful weapon against
rip-offs that you have as a credit card
user. This weapon can save you lots of
money and protect your consumer rights in
many situations.
Have you ever been
dissatisfied with something you paid for
by credit card? Who hasn't? Would you like
to get your money back even months after
you paid the bill? Who wouldn't?
Keep in mind that stopping
payment on your credit card is not like
stopping payment on a check. It's much
better from the consumer's point of view,
because it's powerful and cheaper. Keep in
mind that the stop-payment rights
discussed here do not apply to debit
cards. Your stop-payment right does apply
to all credit card, be they store cards,
American Express Cards, Visa Cards,
MasterCards, or phone company credit
cards.
What is supposed to happen
after you give the credit card company a
stop-payment notice? You have two kinds of
stop-payment rights under the Federal
Truth in Lending Act. I call them the
good-faith stop and the sixty-day stop.
In the case of the
good-faith stop, giving written notice to
the 'in case of problems or disputes'
address on your monthly bill should be the
end of the matter. The credit card company
should remove the charge from your
account. The card company should not tell
you it needs more information or that it
is investigating the matter (though it
probably will tell you that).
Your good-faith
stop-payment right, except for possible
limitations, is absolute. That is, it does
not depend on any additional information
given to or correspondence with the card
company. There should be no hold put on
your credit limit.
The matter should be left
to you and the merchant to settle.
Essentially, you should be in the same
place you would be if you stopped a check
because you were unhappy with something
you had bought.
