Protections Credit Cards Give You

Credit cards are actually safer than cash.

While many people feel a sense of superiority when they pay for the items they purchase with cash or a check instead of a credit card, buyers who use a credit card often have more legal protection when they purchase defective or unsatisfactory merchandise than those who pay with cash.

Under federal law, you can withhold payment on a credit card purchase under the following circumstances:

• The amount of the purchase exceeds $50

• You have made a "good faith" attempt to resolve the problem with the merchant

• The transaction took place within your home state or within 100 miles of the state where you live, or you ordered the merchandise or services from a mail solicitation sent by or on behalf of the company that issued the credit card

Once you notify the credit card issuer that you are disputing the charge because of your dissatisfaction with the merchandise or services provided by the merchant, neither the merchant or the card issuer can report you as delinquent to a credit reporting agency until the dispute is settled or a court orders you to make payment.