How to Handle a Dispute with Your Bank

Don’t let your complaints go unanswered or inadequately addressed.

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Through its annual credit card survey, Consumer Action has consistently found customer service within banks to be significantly inconsistent. For its research, Consumer Action calls agents at top credit card issuers several times with the same dispute to see if they provide a matching answer. "We [typically have] to go back time and again just to get the same answer twice," Susswein says. 

Stay organized. Make things easier by documenting materials related to the dispute, including copies of receipts or statements and notes on who you spoke with and at what time. Greg McBride, senior financial analyst at Bankrate.com, says, "Keeping track of the communication is something we should be doing with any type of dispute," but many people overlook it when they're caught up in an argument.

Keep an open mind. Even if you're positive the bank made a mistake, you may be wrong. Maybe you only glanced at the disclosure agreement you signed for a credit card—that lengthy document you thought wasn't worth your time. By law, credit card disclosures must be written in plain language, so that a layman can understand the provisions, and must appear in a format that's easy for consumers to digest, according to the Credit Card Act of 2009. Unfortunately that's a hard standard to enforce, and the wording in a disclosure agreement can leave people puzzled over what they sign. 

Even so, consumers are legally held to those standards—even if it means they missed a payment by a few hours due to a time-zone mistake on their part. "You may realize it's your fault," says Cardhub's Papadimitriou. "If you go in thinking it's absolutely the bank's fault and you don't listen to a thing they say, you'll only make things worse for yourself." 

Show your appreciation. Those who file a complaint may see the bank as the enemy. However, most banks try to be your ally. Mike Gnitecki, a special education teacher in Longview, Texas, learned this when his credit card lender helped him recoup $19,700 in disputes concerning eBay transactions with a single fraudulent seller. "[They] gave me back my funds in full within days," he says. 

Also, in many cases, banks will waive a fee the first time it's incurred, even if it was well-disclosed, to stay on good terms with customers, says Nessa Feddis, vice president and senior counsel at the American Bankers Association. Customers who are respectful of a bank's leniency pave the way for a good relationship, whereas those with a spiteful tone may set themselves up for less-favorable outcomes in future disputes. 

"Banks have a vested interest in ensuring that complaints are resolved to their customers' satisfaction, because they risk losing that customer to a competitor bank and they risk that customer relaying the experience to other customers or potential customers," says Feddis. "Resolving the complaint offers an opportunity for the bank to solidify the bank-customer relationship." However, she points out there are limits to a bank's flexibility. Banks may cap the number of times they waive certain fees. According to Feddis, the majority of big banks aren't opposed to swallowing a small charge to retain a customer—but that doesn't mean you should abuse their leniency. 

There are also instances where the bank doesn't have the power to resolve the problem. For example, a bank can't override a merchant's "no return" policy. According to Feddis, the highest percentage of credit card complaints filed with the Better Business Bureau against banks are disputes that should have been resolved with the retailer—not the bank. McBride sees many consumers making this mistake: "To some extent, you do have a problem of barking up the wrong tree." 

[Read: 10 Annoying Bank Fees—and How to Avoid Them.] 

Your last resort. Before taking your dispute to an attorney, consider that legal counsel will just add more strain to your wallet. "Attorneys are expensive—they aren't cheap dates," says Ulzheimer. Legal fees add up, especially when cases drag on. So before you hire an attorney, Ulzheimer says, "you better make sure you've been damaged." By "damaged," he means you've sustained a serious financial blow, such as an error on your credit report that cost you a job.