What Damages Are Covered by Credit Card Purchases?

What Damages Are Covered by Credit Card Purchases? thumbnail
You are not liable for some credit card transactions.

Different issues can arise when you purchase an item with a credit card. If you make an online purchase, the product may arrive damaged or the sender may fail to send the product. Or someone can acquire your credit card information and purchase items with your account number. As a credit card account holder, you are not responsible for fraudulent charges or damaged merchandise.

  1. Purchase Protection

    • Under the federal Fair Credit Billing Act, consumers are not required to pay for impaired or useless merchandise or items that do not fit the original product description. For example, a consumer might purchase a boxed item or order furniture from a store with a credit card, and discover the item is damaged when it arrives. Purchase protection offered by credit card companies covers these damages and removes the consumer's liability. This provision also protects consumers in cases of identity theft. If a consumer's credit card is stolen and used for purchases, the credit card company covers the damage and the consumer avoids any out-of-pocket expense.

    Eligible Purchases

    • Purchase protection isn't available on every type of purchase. For example, some credit card companies only offer purchase protection and cover damages on purchases greater than $50. Additionally, some credit card companies only cover damages if an item is purchased within 100 miles of the consumer's home, says Bankrate.com.


    • Before a credit card company will step in and reimburse a consumer for poor quality or damaged merchandise, it requires the consumer to speak with the merchant and attempt to resolve the situation. Consumers must return to the place of purchase or contact the merchant by telephone, explain the situation and attempt to get a refund or exchange the product. It is imperative that a consumer documents his interactions with the merchant. This includes recording the date and time of each conversation and retaining any correspondence sent to or received from the merchant.

    Notify Credit Card Issuer

    • A consumer may contact her credit card company if the merchant refuses to cooperate. To ensure that any damages are covered, the consumer must alert the credit card company to the situation within 60 days of the purchase. The consumer also must write a letter describing the damage, and include copies of any letters sent between the consumer and the merchant. The credit card company must then contact the merchant and hear the merchant's explanation. If the credit card company agrees with the consumer's side of the story, she is not liable for damaged or misrepresented products.

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