How to re-claim Credit Card penalty charges

Posted on February 5th, 2009

A little known fact is that credit companies are only supposed to charge you for whatever cost they incur because of your usage. In fact, the credit companies are not supposed to charge you at all, but over the years this has become a common practice for anyone who has made a late payment, or made a payment that didn’t meet their minimum payment criteria.

To reclaim the money that your credit card company has charged you, simply call their customer services number. Remember while you are talking to a customer care represenitive that you are not just trying to make a point, but you are trying to get your money back. This is going to require compromise on your part, as well as theirs. There are steps to take before calling and requesting your funds.

Step 1.) Adding up all your charges
Go back and get all your statements from the past year. Go through these and add up the amount of fines or penalties that you have been charged for each card individually. The total cannot include standard interest fees, but should include late payment feels, as well as over-limit fees. In England and Whales you can go back in six years worth of statements and collect this information. In Scotland, you can only go back five years.
If you don’t happen to have all of these statements handy, you can always call the customer service line for each card, and request that they send you a copy of all charges. They may try to tell you that they don’t have a record of these past charges. If this is what they try to say, inform then that you are covered under the Data Protection Act. By saying that, they will understand that you are aware of your rights. They should release these documents to you, but bear in mind that they are allowed to charge you a fee for these documents.

Step 2.) Write your Credit companies a letter
If dealing with a customer service represenitive on the phone isn’t going to work for you, it is also a good idea to write them a letter. In your letter make sure that you explain that you believe that they owe you money, and be sure to have a detailed description for them to refer to. When working with these service represenatives, you can also ask them to reimburse you on the interest of these charges. They are not legally entitled to give you this unless you win the case in court, but it never hurts to ask for this now, and pushing the lender into negotiations.
These charges are obviously harder to get taken care of, and although it can be done, it may also extend the settlement time. If you are looking for a faster solution, stick to just asking for the charges to be reimbursed, rather than including the interest also.

Step 3.) Threaten to go to court
The credit companies will not easily give in when you ask for this money. They will use many tactics to stall, hoping that you will become discouraged and give up. Often they will explain to you that these charges are stated in your terms and conditions of your card and that you should go back and read them for further explanation.
They say things like this to try and scare you, as well as discourage you from investigating this issue any further. More or less, they are trying to bully you into backing down from what you want. In the case that you have contacted your credit card company and they have either not gotten back to you in a timely manner, or even rejected your request completely, there is one more option. Go ahead and write them a professional sounding letter that informs them that you will be taking them to court if they do not help you out with your request.
This is the more aggressive action to take, and is to be used once you have tried the prior steps and not gotten the type of response that you are looking for. Another way to get the company to settle is to perhaps offer them a lower amount that what you paid, but an amount that will still help you cover the cost that you incurred. They may go ahead and settle this way.

Step 4.) Financial Ombudsman Service. (FOS)
For the most part, consumers will never have to get to this point. If you are a consumer that has received and partial or even a full payment, you don’t have to continue to read any further.
On the other hand, if you have not received your settlement or any type of response at all, then know that you have two choices. You can either take legal action on this company, or you can go the Financial Ombudsman. (Also known as the FOS). You’ll find that the FOS has the highest power over these types of cases. They are an independent service for resoling disputes between the consumer, and the credit card companies themselves. This service was created by some governments in hope of creating aid in settling disagreements between these two parties.
Proceeding with the process of working with the FOS is simple. You need to either give them a call, or visit their website. Once you do, explain to them what it is that you’re having an issue with and tell them that you’d like them to go ahead and help you with your case. They will then ask you to fill out forms regarding your case, which will include the letters that you have sent to the companies that haven’t been addressed by the Credit Company. Upon deciding that they will take your case, you will receive a confirmation letter. The FOS will then begin contacting all the credit companies that you provided them with information on. Keep in mind when looking into contacting the FOS that they will normally only consider your request if it has been over 8 weeks since you have filed your complaint to your credit company.

Step 5.) Going to Court
The process of filing a small claims form is very simple, one of the benefits is that you won’t have to go to the courthouse or stand in any of the long lines. All the necessary forms are available to you online. There is a fee attached to these forms, and the fee can vary depending on how much you are going to be claiming. You will get a full refund of these fees if you do end up winning your claim.
A large percentage of these cases end up being won be default. This happens because many credit card companies don’t want to waste their time with the court system and the judges; therefore you won’t even have to worry about it making it as far as a hearing.

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