$39 charge for dispute resolution

[MyHouse]

What is the name of your state? Arkansas

I have a credit card with Citifinancial Retail Services that I got when I bought flooring from Carpet One in North Little Rock, AR. It is a three-year no interest special deal.

I noticed that if I didn't send payment in VERY early (at least ten days before due date), I was slapped with a $39 late charge. Initially I was sending all my payments by snail mail and had no problems with my other credit cards. Within the past year I have been paying all of my bills online, and six months ago I started to use the "Bill Pay" feature that my credit union offers. Citifinancial does not offer online payments, but I was able to pay them online using the billpay service.

I noticed on my statement that I had been charged a $39 late fee, so I checked my records. The payment had been made using billpay 9 days in advance, plenty of time for CRS to get it on time. I tried to call them but got a recording saying that if I had a dispute about my bill, I had to send it in writing.

I wrote them a letter and disputed the late fee, and explained to them that I thought they were being slow to credit payments so they could charge late fees. I also complained about not being able to handle the complaint over the phone or online. I sent the letter with delivery confirmation to the address they had listed.

A month passed, and I received a letter saying they were looking into it. Another month passed and I got a letter that stated they were going to credit the $39 to my account.

When my next statement came in, I checked for the credit, and it was there, but there was also a $39 charge for "dispute resolution". I'm afraid to dispute this one because they may charge me $39 again.

Is this legal? If so, is a typical practice of credit card companies? I've had a lot of credit cards and I've never had this happen before.

Thanks.

 

[moburkes]

When you received that credit card agreement in the mail, what charges and fees were listed? You need to find out about the crediting from YOUR bank. They can tell you what date the payment was received, and when it was cashed.

 

[fairisfair]

They won't know when the payment was received, they wil only be able to tell you when it was cashed, if the bank is actually issuing a check to the creditor. Many bill pay services, when remitting to a company that does not transact on line, actually issues and mails a check. Maybe that is what is happening.

I wouldn't just let it go, there is a chance that the "dispute resolution" was in fact posted incorrectly to the account as a charge and not as a credit.

 

[moburkes]

They won't know when the payment was received, they wil only be able to tell you when it was cashed, if the bank is actually issuing a check to the creditor. Many bill pay services, when remitting to a company that does not transact on line, actually issues and mails a check. Maybe that is what is happening.

I wouldn't just let it go, there is a chance that the "dispute resolution" was in fact posted incorrectly to the account as a charge and not as a credit.

Maybe. My bank mails the first payment. After that, they try to get it submitted electronically.

 

[MyHouse]

I thought it may be a mistake too, but if I want to find out, I will have to mail them another letter and wait two months to find out... and if it is a valid charge then I may be charged $39 again for the new enquiry! I'll look up my agreement and will read it, but I'm not sure I will understand it.

If the bank sends them a check, then it seems possible that CRS could let it sit in their mail room a few days before crediting my account.

I know these things do happen because I was notified of a class action lawsuit a few years ago with another credit card company that I used. I had cancelled the card by that time, but did read the details of the lawsuit because I was curious. Apparently they were holding off on crediting payments so they could charge a lot of late fees. How they got caught I do not know.

 

[moburkes]

I thought it may be a mistake too, but if I want to find out, I will have to mail them another letter and wait two months to find out... and if it is a valid charge then I may be charged $39 again for the new enquiry! I'll look up my agreement and will read it, but I'm not sure I will understand it.

If the bank sends them a check, then it seems possible that CRS could let it sit in their mail room a few days before crediting my account.

I know these things do happen because I was notified of a class action lawsuit a few years ago with another credit card company that I used. I had cancelled the card by that time, but did read the details of the lawsuit because I was curious. Apparently they were holding off on crediting payments so they could charge a lot of late fees. How they got caught I do not know.

They are not allowed to hold it. There have been lawsuits and fines. Also, can you make the minimum payment a month in advance, so that you are always ahead? Also, write a check and mail it CMRRR, so that you have PROOF when it was delivered. Hmm. That might not be an option if you're mailing to a PO BOX.

 

[MyHouse]

I'm sure they are not "allowed" to hold it, but what if their mail room is just slow? Maybe they are short-handed. (Seems there are ways to get around what is "allowed".) This is why I thought it would be safer to do it through the credit union. I do pay the bill as soon as I have the money, no matter how early it is. But the payment is not a small one for me. I'll be pretty strapped for the next 3-4 years as I pay off a lot of debt. Even though this is an interest free account, I think I will put all extra resourses towards paying it off (I have some small work bonuses coming up.) My balance is about $2500.

I'll do some checking with the credit union to find out more about how these payments work and if a check is mailed. Perhaps the credit union was slow about sending the check. (I doubt that because I had trouble with CRS when I was sending payments in the mail myself.)

 

[FlyingRon]

I'm sure they are not "allowed" to hold it, but what if their mail room is just slow? Maybe they are short-handed.

Not an excuse. If they receive the payment and don't bother processing it, it's their won fault.

I've never heard of a $39 charge for resolving a dispute (especially one found in your favor)?
I

 

[boswd]

i would send in a complaint to the Better Business Bureu. www.bbb.com

 

[TigerD]

i would send in a complaint to the Better Business Bureu. www.bbb.com

Why? What's the Better Business Bureau got to do with anything? What can they do?

 

[aant]

Why? What's the Better Business Bureau got to do with anything? What can they do?

I think the point was to provide a mode of complaint only, for consumer knowledge; it wouldn't help resolve anything. I don't even know how important BBB reputation is to companies.
MyHouse I would reread your agreement; I'm doubtful there's a provision for them to charge for dispute resolution. You could pay a month early, but why should you have to unless you want to? Receiving party's ineptitude is not a good reason.
If it's not in the agreement then obviously you are deserved a refund & no additional charge to request the refund. If it is, I'd ask them to waive it (esp. if you find an undue delay between payment sent & cashed), keeping in mind what moburkes pointed out about dragging their feet on payments. If there have been lawsuits &fines, then somebody got caught doing something & your friendly CC company is not immune. There's a fine line to threatening them with your knowledge of it though, & risking just pissing the rep off & getting nowhere.
Meanwhile, your idea of paying this thing off ASAP seems wise. They smell a little cheesy to me, and interest free begins to pale under $39 fees plus annoyance.