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Dodgy service providers are a charge-back gray area

  By January 3, 2014


In an ideal world, you’d have time to vet every service provider who comes to your house. But when you have a household disaster — the toilet clogs, a pipe bursts, your basement floods — you might end up making a hasty decision.

That’s what happened to me several months ago when our hot water heater broke. And the situation that ensued got me wondering: Is it ever OK to dispute a credit card charge for services rendered if you feel they’re not up to par or the company was dishonest?

In our situation, the plumbing disaster happened right before a holiday weekend, and the leaky heater flooded the wood floor in our utility room. Desperate, we called the first local plumbing company we found.

The company sent out a person who said he was a plumber. We were about to go out of town for the weekend, and the “plumber” told us he could just turn off the water and come back on Monday. He did, and I sopped up the mess on the floor. When we returned, we could hear water leaking into the crawl space under our house. On Monday, the “plumber” never showed up. On Tuesday, he called and said he was coming over. I had a bad feeling about him, but wanted the repair done quickly, so I agreed.

We ended up having the company replace two hot water heaters, the damaged one and another one that was very old. When my home insurance company later sent an adjuster over to take a look at the water damage to our floor, he asked, “You did have a licensed plumber install these hot water heaters, right?” I started to worry and called the company to verify that the “plumber” was licensed. The company evaded my questions and one employee yelled at me for asking. After a few calls, I learned the company had sent an unlicensed tech, in violation of state law.

I really wished I could undo the whole purchase and hire another company, but the heaters were already installed at that point.  I had paid $4,000 to a company that violated state law and had my work performed by someone with iffy qualifications. I briefly considered disputing the charge.

I’m not alone in having this problem. One of the Top 5 fastest growing consumer complaint categories in 2012 involved unlicensed contractors, according to a 2013 survey by the Consumer Federation of America. And according to Chargebacks911, a company that helps merchants in credit card disputes, an unsatisfactory product or service is an acceptable reason to file a charge-back.

After talking with my credit card company and probably over-thinking the whole thing, I decided it would be too much hassle (and possibly a losing battle) to dispute the charge for the service — especially since I wasn’t actually having problems with the heaters. But, because hot water heaters can leak and cause damage, I still wish I had the peace of mind of knowing the job was done by a licensed pro.

Experts say it can be tough to win a charge-back dispute for services you have received, even if the service was faulty. Take, for example, this consumer, who wrote to, asking for advice after Citibank denied her charge-back request for a payment to a shady locksmith. The consumer had hired the locksmith to fix a door handle, which did not really get repaired and later fell off. It turned out the locksmith was operating without a license.

Simon Zhen, the analyst for who answered the reader’s query, pointed out that filing a charge-back dispute for shoddy service can require lots of documentation from the consumer, and credit card companies don’t always tell you what evidence you need to supply.

According to Zhen, consumers can increase their chances of prevailing in such a dispute by providing three key pieces of documentation:

  1. A receipt for the service.
  2. Documentation of unsuccessful attempts to contact or resolve the issue with the merchant.
  3. Written confirmation from another professional that the original service provider did not complete the job properly.

If the consumer loses the dispute, there’s always small claims court, Zhen adds. And, according to, a card issuer might provide a courtesy refund even if the situation doesn’t merit a charge-back.

For me, the situation with the shady plumber was a good reminder to always have service providers lined up before an emergency occurs. Having the number of a qualified plumber would have helped me avoid the whole mess.


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