ACH Refunds and Disputes
Refund Timeframe
You can issue a refund for an ACH Direct Debit payment within 180 days of the original payment date.
Refunds take at least 3 business days to process
They may take up to 6 business days to appear on the tenant’s bank statement
Avoiding Disputes
If a tenant accidentally makes a payment, contact them immediately to avoid a potential dispute.
ACH payments can sometimes cause confusion due to:
Longer settlement times
How banks process ACH Direct Debits
For example: A tenant may contact both you and their bank to dispute a payment. If you issue a refund at the same time their bank initiates a dispute, the tenant may receive two credits for the same payment. That’s why it’s important to clearly communicate the refund status and timeline with your tenant.
How ACH Refunds Work
If the payment hasn’t settled yet, and you issue a refund, Stripe will cancel the original payment instead of processing a refund.
ACH refunds are processed as new credit transactions on the tenant’s bank statement—not labeled as “refunds.”
However, they will include a reference to the original payment's description for clarity.
ACH Disputes
Tenants can dispute ACH payments directly with their bank:
Personal accounts: within 60 calendar days of the debit
Business accounts: within 2 business days
In rare cases, disputes may be accepted outside these windows
Important: ACH disputes are final. There is no appeal process, unlike credit card disputes. If a tenant successfully disputes a payment, you must work directly with them to resolve the issue.
Double Refund Risk
If you issue a refund while the tenant’s bank also initiates a dispute, the tenant may receive two credits for the same transaction.
To avoid this:
Communicate with your tenant before processing a refund
Wait to confirm no dispute has been filed before issuing a refund
Follow the ACH refund guidelines carefully