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Guide to Canceling a Credit Card Payment

By Kelly Boyer Sagert · October 17, 2022 · 8 minute read

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Guide to Canceling a Credit Card Payment

Whether you’ve noticed a potentially fraudulent charge or you simply changed your mind on a purchase, there are a number of reasons why you might want to cancel a credit card payment. Luckily, there are actions you can take to do so, assuming the payment falls within certain parameters.

Read on to learn how to cancel a credit card payment, whether the charge is still pending or if it’s already posted. We’ll also cover how to stop payments on credit cards if you don’t want your scheduled payment to go through.

Can You Cancel a Credit Card Payment?

Per the Fair Credit Billing Act (FCBA), a law that all credit card issuers must follow, there are times when you can withhold a payment. So if you define “cancel” as disputing a charge instead of making the payment, there are instances when it’s acceptable under the law to cancel credit card payment.

You can also request to cancel a credit card payment if you believe it’s the result of fraudulent activity.

Related: How to Cancel a Credit Card

Things to Consider Before You Cancel a Credit Card Payment

Before you go willy-nilly with canceling credit card payments, it’s important to note that the previously mentioned FCBA guidance only applies when you believe a billing error was made. Per the Federal Trade Commission (FTC), examples of billing errors include:

•   Unauthorized charges

•   Charges with the wrong date or amount listed

•   Charges for items or services you didn’t accept or that weren’t delivered as agreed

•   Mathematical errors

•   When the credit card issuer didn’t post your payments or your returns/credits

•   When the credit card issuer didn’t send the bill to the appropriate address, assuming they were provided adequate notice of any change in address

•   Charges where you’ve asked for written proof of a purchase or an explanation of it, along with a claim of an error and a clarification request

Further, you generally must have made the purchase on your credit card in your home state or within 100 miles from your home for the laws on credit card disputes to apply. The charge in question must be for more than $50. Credit card rules stipulate that it’s also necessary to have made an attempt to resolve the issue with the merchant first.

Recommended: What is a Charge Card

Reversing a Credit Card Payment After It Has Been Made

If you’ve already paid the merchant but are unsatisfied with how they’ve responded to your complaint, contact your credit card company to see if you can get the charge reversed. They may call this a chargeback.

Parties that will get involved in the process, besides you, can include your credit card issuer, the merchant from whom you purchased goods or services, the merchant bank, and the credit card network. This is due to how credit card payments work.

Typically, you’ll receive credit on the disputed amount while an investigation takes place. If you win the billing error dispute, this credit card refund will remain permanent. If the case isn’t decided in your favor, then the amount would get added back to your credit card balance.

Recommended: When Are Credit Card Payments Due

How to Cancel a Credit Card Payment After It’s Made

If you’re hoping to cancel credit card payment, here are the general steps you should go through to do so.

Attempt to Resolve the Dispute With the Seller

As an initial step, contact the seller of the item you’re unhappy with and explain the situation. It’s possible, for example, that you received the wrong item or a part may have been defective in what you received. Perhaps they can send you a replacement. Or you can ask the seller to reverse the charges on your credit card, resulting in a credit card refund.

Avoid Paying the Disputed Amount

If you don’t get satisfaction by working with the merchant, you can decide to not pay the disputed amount and have the situation investigated. To make that happen, though, you need to follow specific steps, starting with reaching out to your credit card issuer.

Contact Your Credit Card Issuer

Write and send a letter to your credit card issuer that outlines the billing error and disputes the charge. Your credit card company should have a billing inquiry address listed on its website.

Make sure to send this letter within 60 days of receiving the billing statement with the disputed charge. Keep copies of the letter, and consider sending it via certified mail with a return receipt.

Await Your Credit Card Company’s Decision

Then, you wait. The creditor has up to two billing cycles — a maximum of 90 days — to resolve the dispute. The result may be that you don’t have to pay the disputed amount, or that you do. Or, you may end up needing to pay part of it.

If you have reason to believe that the creditor isn’t following the rules set out by the FCBA, you have the right to sue them. If you were to win, the court may award you damages and order the credit card company to pay your attorney fees.

Understand the Limitations

After you’ve filed a dispute, you aren’t required to pay the charge in question until after the investigation ends and a decision is made. That said, you are required to pay whatever else is owed on this bill — such as a credit card minimum payment or finance charges on the undisputed portion of the bill. And, of course, remember there’s no guarantee that you would win a lawsuit.

Recommended: What is the Average Credit Card Limit

How to Stop Payments on Credit Cards

Perhaps you want to know how to stop a scheduled payment on a credit card that hasn’t already been made. In this case, you’d need to contact your bank at least three business days before the payment is set to come out. Do so in person, in writing, or over the phone. The financial institution may require a follow-up of this request in writing within 14 days.

Note that, even after the bank stops a payment, you may still be responsible for making the payments to the credit card company. If you have questions about liability, you can email the Federal Deposit Insurance Company (FDIC) or call toll-free at 1-877-275-3342.

Here are some other general tips to keep in mind for the process of stopping payment on a credit card.

Recommended: Tips for Using a Credit Card Responsibly

Identify the Credit Card Payment You Want to Cancel

When you contact your bank, make sure you’re clear about which payment you want to cancel. If you only have one automatic payment taken out, this wouldn’t apply.

Check the Restrictions That May Apply

Be clear about whether your stopped payment falls within your FCBA rights. Remember that you’re still liable to pay your credit card bill outside of any disputed charges due to how credit cards work.

Contact the Credit Card Provider to Stop the Pending Payment

If you want to contact your credit card company to stop a pending payment, use the phone number on the back of your card. You can then talk to someone about stopping the payment.

Verify That the Payment Has Been Canceled

Whether you talk to your financial institution or the credit card company, ask for the name of the person you spoke to and a confirmation number. Take good notes and keep them. Later, you’ll want to check back to make sure that the payment was indeed canceled.

What to Do in the Case of the Non-Reversal of Funds

If you aren’t satisfied with how your credit card company is handling a situation, you can submit an online complaint online to the Consumer Financial Protection Bureau (CFPB) or call them at (855) 411-2372.

Also keep in mind that if your dispute was denied, you can request an explanation from your credit card company. You also have the option to appeal the decision.

Recommended: Does Applying For a Credit Card Hurt Your Credit Score

The Takeaway

It is possible to cancel a credit card payment if it falls within your FCBA rights or it’s due to fraudulent activity. There are protections built into the law for when you receive erroneous billing, as well as an established process to follow to address this issue. In the meantime, you’re still liable to make minimum payments outside of the disputed amount.

If you’re looking to apply for a credit card, SoFi offers one that’s designed to help you save and invest as well as to pay down SoFi debt.

The SoFi Credit Card offers unlimited 2% cash back on all eligible purchases. There are no spending categories or reward caps to worry about.1



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FAQ

Can I cancel a pending transaction on my credit card?

Possibly. Contact the merchant and ask them to cancel the transaction. Aim to do so in the day or two before the pending charge is added to your balance. Once it’s posted, then you would need to pursue another route, like filing a dispute or asking for a chargeback.

Does canceling a credit card payment affect your credit score?

If you dispute a charge, it may show up on a credit report, but it won’t directly affect your scores. The FCBA notes that it’s not legal for someone to be denied credit because they disputed a bill. That said, to avoid your credit score getting dinged, you must keep up credit card payments outside of the disputed amount.

How long does it take to cancel a credit card payment?

You should provide at least three days’ notice before a bill is set to be taken out of a bank account. That should provide adequate time for the cancelation of the credit card payment.


Photo credit: iStock/solidcolours??

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1See Rewards Details at SoFi.com/card/rewards.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

The SoFi Credit Card is issued by SoFi Bank, N.A. pursuant to license by Mastercard® International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

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