I lost my credit card far from home -- what's my liability?

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Question:

I just realized that I lost my credit card while on vacation a few weeks ago. A friend told me that unless I lost the card within 100 miles of my home, I'm stuck with any subsequent charges. Can that be right?

Answer:

Wouldn't that be a doozy of a rule. But your friend has things all muddled, perhaps as a result of trying to read the tiny print on the credit card pamphlet before aiming it at the trash bin.

Luckily, there's no need to strain your own eyes over this one. Federal law limits your liability for unauthorized charges made on your credit card after it has been lost or stolen. It doesn't matter whether your card was lost at your corner store or in Timbuktu.

You simply need to tell your credit card company about the loss within a reasonable time, usually 30 days. Calling their toll-free number is usually the fastest and easiest way, although you should follow up in writing. Once you've notified them, you are not responsible for any charges made after that, and you are liable for only the first $50 of charges made even before you called. (To learn more about your liability, see Nolo's article Your Liability for Unauthorized Credit and Debit Card Charges.)

Your friend may be thinking about a different rule, concerning withholding payment for credit card purchases. For Visa, MasterCard, and other credit cards not issued by the seller, you can refuse to pay only if the purchase was for more than $50 and was made within the state you live or within 100 miles of your home. (To learn more about disputing a credit card charge, see Nolo's article What to Do If There's an Error on Your Debit or Credit Card Statement.) So you're better off losing your card in Timbuktu than buying a blender there.

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