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Protecting Your Card Rights

Don't wait until you have a problem with your card to find out your rights. They're spelled out on the back of your statement.

A lot can go wrong when you use a credit card, even if you stay within your limits and pay promptly. It makes sense to keep your receipts, check them against your monthly statement, and notify the card issuer right away if you spot any charges you didn't make or other errors.

Some card issuers respond promptly to questions, complaints, or reports of stolen cards, while others may make it more difficult to get your problem resolved. Since cards are readily available from a wide range of sources, you may consider customer service when you evaluate whether to stick with your current issuer or switch to a new provider.

Reproduced with permission of Lightbulb Press, Inc.

HANDLING PROBLEMS

Lost or Stolen Cards

If you report a missing card immediately by calling the number on the back of the statement, you aren't responsible for any charges. $50 is the most you'll owe even if you don't report losing your card until after it has been used by an unauthorized person. Some card issuers even forgive that $50 potential charge.

Billing Errors

You have 60 days to notify the lender in writing about billing errors. This includes wrong amounts of credit extended, unauthorized charges, wrong goods or services, incorrect payments or credits, computational errors or any other disputed charges. Card companies have 30 days to respond and up to 90 days to resolve the problem. They can't stop you from using your card while investigating the problem and can't release a bad credit report on you based on the disputed charges as long as you continue to pay the rest of your bill. And if they don't respond to your complaint, they can't collect the disputed amount or finance charges

You may be able to transfer any outstanding charges on an existing account to a newly opened account. But remember that closing an account doesn't resolve disputes you have with the issuer.

The Fair Credit Billing Act sets the procedures for resolving billing errors. In some cases, however, you may have to be persistent to get a problem resolved.

GETTING MORE CREDIT

More isn't always better where credit is concerned. Obviously you need a large enough credit limit to be able to charge something you need -- an airline ticket in an emergency, for example. But you can have two types of problems with large credit limits. The first, which you can control, is that you might be tempted to spend more than you can afford to repay. The second is that whatever credit you have available may count as a liability when potential creditors consider your application for a loan or mortgage, even if you never charge as much as you could.

SAFETY TIPS

Never give your credit or debit card number (or card) to anyone unless you're buying something or making a reservation. Since merchants can't charge your credit card account if your check bounces, or is returned unpaid, there's no reason to write the card number on your check for them. And there's no obligation to put your phone number, name, or address on a credit card receipt even if the seller asks for that information. In some states, it's illegal for a retailer to ask you to do this. Destroy copies of your receipts after checking them against your credit card bill. And be careful when providing your number in a public places, such as a telephone in an airport lobby. Thieves can use your card number to charge purchases or even order new cards. Never make your personal identification number (PIN) available to anyone. Don't write it anywhere a thief may have access to it. Many experts also advise you to use a PIN others can't figure out easily. But the PIN has to be one you can remember.

Defective Merchandise

You can legally refuse to pay for defective merchandise if it cost more than $50 and you were unable to resolve the problem with the merchant. The purchase must be made in your home state or within 100 miles of your mailing address, though companies are flexible on this restriction. The price and mileage limits don't apply if the card issuer advertised the product or was involved in the purchase.

Disclaimer: This information is provided with the understanding that the authors and publishers are not engaged in rendering financial, accounting or legal advice, and they assume no legal responsibility for the completeness or accuracy of the contents. Some charts and graphs have been edited for illustrative purposes. The text is based on information available at time of publication. Readers should consult a financial professional about their own situation before acting on any information. Lightbulb Press, Inc. 112 Madison Avenue New York, New York 10016 Tel: 212-485-8800 www.lightbulbpress.com

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This content is provided as educational material only and is not intended to solicit you for any product or service. These materials are not a recommendation by HSBC for any product, service or financial strategy. The suggestions and recommendations contained within are general in nature, and may or may not apply to your particular circumstances. Securities, annuity and insurance products are not FDIC insured or insured by any federal government agency of the United States; subject to investment risk, including possible loss of principal invested. All decisions regarding the tax implications of your investment(s) should be made in connection with your independent tax advisor. Should you need further assistance, HSBC strongly recommends contacting an independent attorney, tax professional or financial consultant.