Page 52 - Book6E

No man’s credit is as good as his money.
— E.W. Howe
44
Since your debit purchase is deducted from your account at or shortly after the time of purchase, you’re on your own if something goes wrong with the purchase. The bank won’t re-deposit the money in your account for items that fail to be delivered, are of poor quality, or don’t work. Debit cards may be a great way to pay for gasoline or groceries, but for big-ticket items, it’s wiser to use a credit card.
Liability Protection Puts the Burden on the Cardholder
If someone misuses your credit card, your maximum liability under federal law for unauthorized use is $50. The regulations that protect you from fraudulent use of your debit card are not as user friendly. With a debit card, your liability for unauthorized use, under federal law, depends on how quickly you report that your card has been lost or stolen. For example, if you report the loss within two business days after you realize your card is missing, you will not be responsible for more than $50 of unauthorized use. Your liability increases to $500 if the lost or stolen
debit card is reported within 60 days.
Failure to report unauthorized use within 60 days after your bank mails you the statement will cause you to face unlimited loss. This means you can lose all the money in your bank account and, perhaps, the unused portion of any line of credit established for overdrafts. As with credit cards, once you have reported the loss of your debit card, you cannot be held liable for additional unauthorized use that occurs after that date. Some debit card issuers offer more protection than the law requires. However, these are voluntary measures and could change at any time.
Using Debit, Check and ATM Cards