Consumer complaint received 2018-09-11
Company: Santander Consumer USA Holdings Inc.
State: NJ
Product: Vehicle loan or lease
Sub-product: Loan
Issue: Managing the loan or lease
Sub-issue: Problem with the interest rate

Complaint:
In XX/XX/XXXX, I submitted a complaint regarding my loan with Santander Bank. As of this date, Santander has not been willing to come to a fair and reasonable resolution. 

In XX/XX/XXXX, I financed a XXXX XXXX XXXX with Santander USA. The cost of the vehicle was {$13000.00}. The finance charges for a 6 year loan amounted to {$12000.00}. 
Total amount : {$27000.00}. During the time of purchase, a down payment of {$1100.00} was applied, reducing the balance to {$26000.00}. Over the life of the loan, I have submitted payments amounting to {$24000.00}. Given this Santander is reporting that I still owe {$7300.00} ( payoff  amount ). Per Santander, this amount is the result of submitting late payments. 

I have previously stated that the my finance contract is not clear. Nothing in the contract clearly states that submission of late payments will result in the increase of interest ; only late fees. Given my dilemma, I have researched what a simple interest loan is ... however, this is not clearly stated in my contract ; and is was not explained to me by the salesperson or finance person at the dealership. Knowing this, I would not have accepted the loan. 

Financially, I am not doing that well at this time. I still owe money on my student loan, I have deductions taken out of my check to pay for other loans. This is not a good situation to be in at all. My wages are eaten up in bills. 

I do not understand why this company would operate in this manner. It is understandable that all loans should be paid on time. However, given, the type of customers Santander approves loans for : bad credit - ( resulting in higher interest rates ). Why would extra interest be applied to a loan when one has shown a hardship in making payments? 

In XX/XX/XXXX, my payments were current. Actually, in XX/XX/XXXX my  next payment was not due until XX/XX/XXXX. Given this, I submitted two partial payments in XX/XX/XXXX or XX/XX/XXXX ; not sure. What I am sure of is, the full payment submitted in XX/XX/XXXX - no money was applied to the principle balance and the total payment amount was applied to interest??? I called Santander several times, and the matter was never resolved. 

This is the type of unfair business practices that myself, and many other customers are experiencing. The internet has many complaints from customers expressing my concerns or similar concerns. Why? 

This is not my first car loan. However, this is the first time that I experienced late payments resulting in late fees and additional interest. 

If this is the practice of this corporation, an outline and clear breakdown of their practices should be stated in the contract. With the current reported balance, this contract will never get paid as additional interest is being applied to the loan when payments are late. 

Please, I am asking that Santander works with me to payoff the remaining balance - {$26000.00} - {$24000.00}. Amount - {$1600.00}. 

I read an article from XX/XX/XXXX that the CFPB was in talks of filing a class action suit against Santander. Whether this is accurate or not, legal action is a last result. 
My request is that a fair and reasonable solution be the outcome.

Company response to consumer: Closed with explanation