Posted by: coastcontact | January 30, 2013

Credit Cards Can Be Better Than Cash

I bought a new bed using a credit card.  I could have written a check for the full amount but the bed store offered a one year no interest payment plan.  Why not? I thought.  So the bed was to be delivered three days later.

Oh, there is one thing I neglected to tell you.  The old bed had a foam topper that was purchased separately and has been on top for about seven or eight years.  My beautiful wife said it’s not the topper that is sagging it’s the bed.  OK, I agreed without challenging her wisdom.  However, the next day, after I had ordered the new bed, she decides to remove the topper and check the mattress.  “Look at this” she says, “the mattress without the topper seems quite comfortable.”  I lay down on the bed and surprise.  It feels identical to the new bed.  I called and cancelled the bed order!  Did I yell at my wife?  No!  Was I happy the bed was bought using a credit card? Yes!

Thus you have learned one of the benefits of credit card purchases.  If you have a problem with a product you’ve purchased – it’s damaged or defective, or is never delivered ­you have extra legal protection if you bought the item with a credit card. Federal law gives consumers the right to withhold payment on credit card purchases in certain situations.

Try to resolve the dispute directly with the seller. If you call the seller or visit in person and don’t get a resolution, send a letter so that the issue is documented. In the meantime, don’t pay the amount that is in dispute, the California Department of Con­sumer Affairs says.

If the problem remains unresolved, call your credit card company and tell it you want to withhold payment for the disputed transaction. Follow up with a letter to the card company, and send a copy to the seller. This will “demonstrate to the seller that you intend to follow through with your complaint, and that will increase the chance that the seller will resolve the problem voluntarily,” the consumer agency said.

The credit card company will contact the seller and try to resolve the dispute. While the item is under investigation, your card issuer may not report you as “delinquent” for withholding payment, provided that you follow the steps above. But the card company can describe the amount as “disputed.” “Since the dispute probably will end up on your credit record, the right to withhold should never be used frivolously,” the consumer agency said.

Your right to withhold payments does not apply if the transaction was for less than $50, or if it took place more than 100 miles from your home and in a state other than your own. But those restrictions are waived if the credit card was issued by the seller – a department store credit card, for example.

You can withhold payment only if you use your card as a credit card. Using it as a debit card is like paying cash.



  1. You made some very good points, as long as you don’t live in one of the 40 states that are now allowed legally to charge a 4% surcharge for using your credit card.

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