Consumer complaint received 2018-04-10
Company: Santander Consumer USA Holdings Inc.
State: OH
Product: Vehicle loan or lease
Sub-product: Loan
Issue: Incorrect information on your report
Sub-issue: Account status incorrect

Complaint:
This is my second complaint against Santander Consumer USA and XXXX XXXX please refer to my first complaint # XXXX for additional details for this complaint. 

I had a 60 month automobile loan with Santander to purchase a XXXX XXXX XXXX. The loan term began in XXXX with 60 monthly payments due in the amount of approx {$180.00} per month. Since the inception of the loan with Santander I routinely and regularly made payments in excess of the required {$180.00} per month in order to shorten the life of the loan and minimize the interest paid. Since it's inception Santander made it a routine practice to take any additional payment monies received above the required {$180.00} and apply those additional funds to the next months bill, thereby lowering the amount due or eliminating the next payment due altogether. This practice enabled Santander to continue accruing additional interest at 25 % on my auto loan for the duration of 60 months. 

Throughout the duration of my loan I never made a single payment beyond the 30-day window to be considered a late payment for credit reporting. If my payments were not received on the exact day due which was the XXXX of every month, Santander would begin collection efforts with auto dial calls sometimes up to five times per day and also immediately charged late payment fees. Additionally, Santander would charge {$10.00} to make online payments with debit cards. As I mentioned at no time did I exceed the 30-day window necessary for derogatory credit reporting. 

In XXXX of XXXX I made a balloon payment on my acount of {$1000.00} followed by another balloon payment in XXXX of {$500.00} for a total of {$1500.00} leaving a loan payoff balance of approximately {$430.00} and some change. My loan was not due to mature until the following year in XXXX of XXXX. These balloon payments should have covered my regular payments until XXXX of XXXX in accordance with Santander 's standard practice of applying over payments to the next months bill instead of the principal balance. 

In XXXX of XXXX I submitted the final payment due and paid off my automobile loan with Santander and I assumed my business with them was complete. 

In XXXX of XXXX while shopping for XXXX gifts for my grandchildren I was told at the register that my XXXX XXXX XXXX credit card had been declined. When I investigated with XXXX XXXX XXXX why my card with a very small balance was declined, I was informed that my credit limit had been reduced due to derogatory reporting to my the credit bureau of late loan payments for my vehicle. I was both shocked and surprised at this development because I have maintained excellent and on time payments on my revolving credit responsibilities. 

Upon checking with the three credit reporting agencies I discovered that Santander had reported me as being 30, 60 and eventually 90 days late on my auto loan payments. I immediately contacted Santander and was put into an endless loop of customer service agents and supervisors who all told me that my credit reporting was accurate. I spent hours on the phone speaking to various supervisors and customer service representatives who all confirmed that the company did forward any received over payments and deduct them from the next month 's billing instead of deducting theover payment amount from the loan principal. Despite my efforts to explain that I had made two balloon payments in both XXXX and XXXX to cover my payments for the period of XXXX to XXXX the customer service representatives maintained that the computer was correct. 

I filed a dispute with the three credit agencies and informed them that the information contained in the Santander reporting was incorrect. Santander responded to the credit agencies and reported that the information was accurate and my request to have the derogatory information removed was denied. After making numerous additional attempts to speak with anyone at Santander to resolve this issue to no avail I filed my initial complaint with your office on XX/XX/XXXX. 

In response to my complaint Santander submitted defamatory information indicating that I had made several " late payments '' which consisted of payments that were made a few days after the actual due date but not one of the payments they noted exceeded the 30-day window that would warrant a late payment reports to the three credit bureaus of 30, 60 or 90 day late payments. As a result of the information received from Santander the credit agencies further upheld the incorrect reporting and made no changes to my credit report. Because this information remained on my account for a total period of 7 months the damage to my credit continued. 

My credit score plummeted from XXXX to XXXX. My account with XXXX XXXX was closed, my XXXX XXXX XXXX account was first reduced then subsequently closed, and my XXXX account credit line was significantly reduced as a direct result of the derogatory credit reporting by Santander against me. All the credit agencies cited negative revolving credit obligations as the reason for the closures and reductions. Despite never making a single late payment to any of the creditors in question. 

On XX/XX/XXXX I was contacted by Santander 's Office of Consumer Affairs and spoke with XXXX who advised that Santander had made a " mistake '' with my credit reporting. XXXX, stated that the accounting systems used by Santander were " unable '' to account for advance payments beyond a 3 month window so my payments were not accurately reflected to indicate that my payments were up to date and paid until XXXX of XXXX. According to XXXX my payment obligations were so far ahead of schedule that their system simply was not able to handle the information. 
As a result of the Santander computerized accounting system limitations my payments in XXXX and XXXX totaling {$1500.00} were not appropriately posted to my account to reflect advance payments. Instead they were only able to apply it across a 2 month period rather than the 8 month period spanning from XXXX to XXXX. 

In order to properly reflect my payments Santander would have had to manually update their system two months later to properly reflect the account balance and my 8 months worth of payments. This error was in no way my fault and Santander apologized and XXXX stated that they would notify the credit reporting agencies of their error and make the necessary repairs to my credit reporting. 

On XX/XX/XXXX I checked with the credit agencies and found that this information had not been updated. I contracted the office of Consumer Practices with Santander to inquire as to when they would be correcting the derogatory information to the credit bureaus and I was told that it was in process and should be done very soon. I advised them at that time that I had been in the market to sell my home and buy another one and that this reporting was hampering my ability to apply for a home loan and relocate. I was told that I should see something within the next couple of weeks. 

On XX/XX/XXXX, a full month later, as I continued to receive letters from my creditors reducing and closing my accounts due to the derogatory information contained in my credit report, I again contacted Santander 's office of Consumer Practices and asked why my credit report was not corrected yet. They advised at that time that they were not sure what happened, that it had " fallen through the cracks somehow '' but they would notify XXXX and assured me that they would get this issue resolved immediately. I again informed them that I have been waiting since before XXXX for this issue to be resolved and that I am unable to purchase a new home with this derogatory information on my credit report. They stated they understood and would make the corrections a priority. 

On XX/XX/XXXX I received another notice that my XXXX XXXX XXXX account had been closed altogether as a result of the derogatory credit reporting by Santander. I contacted Santander Consumer Practices and spoke to XXXX she stated she would contact XXXX and get a status on the correction. At that time I requested even a basic email to provide the finance companies as proof that the credit reporting on this loan was inaccurate and that my payments had been made on time. She stated that this is not something that Santander could provide until the changes had been made to their computer system. I stated that I have been held XXXX by this credit report and became tearful and upset at this ongoing issue. She was sympathetic and assured me it would be immediately resolved. 

On XX/XX/XXXX I contacted Santander Consumer Practices and spoke to XXXX who stated that my inital complaint case with Santander was closed on XX/XX/XXXX despite the fact that the error had not been corrected in their system and that the case was not resolved. She advised that this is probably the reason that it " fell through the cracks ''. She reopened my complaint case in order to insure that it was completed. XXXX also contacted XXXX to get an update on the status of the correction with the credit bureau. I again begged for an email to provide the finance company and advised XXXX that my fiancee moved to Colorado in late XXXX to early XXXX and that I have not been able to follow him due to the erroneous reporting and my inability to apply for a home loan due to the affect on my credit score. XXXX advised that she would personally follow up to insure that the proper updates were undertaken. 

On XX/XX/XXXX I again contacted Santander Consumer Practices and was informed that the updates were submitted to the credit bureau and that a letter was being emailed to me regarding the reporting error. 

1 ) This account was paid properly and on time for the entire duration of the loan period. Santander and never once was 30 days late. 
2 ) Santander made it a routine practice to apply any over payments to the next month 's bill rather than reduce the principal balance allowing them to continue collecting 25 % interest on the loan amount due. 
3 ) The payment amount due for the car was {$180.00} per month. For the duration of the loan I made over payments to reduce the interest period on the loan. 
4 ) In XXXX and XXXX of XXXX I made balloon payments totaling {$1500.00} to Santander for the period from XXXX to XXXX. 
5 ) Santander improperly applied those payments due to limitations in their computer system and failed to update their systems to reflect the payments as received. 
6 ) The loan was paid in full in XXXX of XXXX eight months before the maturity date in XXXX of XXXX. 
7 ) Santander provided false and derogatory information to the credit reporting bureaus which negatively impacted my credit score. 
8 ) I disputed the derogatory and false information with the credit agencies. Santander told the agencies that their information and reporting was accurate and my dispute for removal was denied. 
9 ) My credit was damaged as a result of the derogatory reporting by Santander. 
10 ) I filed a complaint with the CFPB in XXXX of XXXX. Santander responded and continued to uphold their position that my payments were made late. 
11 ) In late XXXX nearly 4 months later Santander contacted me and informed me that they had in fact made an error in both recording my payments and reporting them to the credit agencies.. 
12 ) After contacting me Santander delayed repairing the derogatory reporting for an additional 45 days causing even more damage to my credit standing. 
13 ) As a direct result of the actions by Santander and their derogatory false reporting my credit score fell from XXXX to XXXX. 
14 ) My credit account with XXXX XXXX was closed by the company, my XXXX XXXX XXXX account was first reduced to {$150.00} then subsequently closed and my XXXX account was significantly reduced from a credit line of {$3000.00} to a mere {$1200.00}. 
15 ) I was unable to put my home on the market and obtain a loan to purchase another home with my partner in Colorado due to the significant damage to my credit score. 
16 ) Despite knowing that they had made this error and informing me of the error ; Santander refused to send a simple email indicating that the derogatory information on my credit reporting was an error to enable me to move forward in applying for pre-approval for a home loan and move as planned. 

The actions of Santander materially damaged both my credit and my ability to relocate with my partner to Colorado. Due to the significant drop in my credit rating I was unable to put my home on the market or apply for pre-approval for a new home loan. My significant other is currently living in Colorado and I have lost companionship with him for a period of 5 months as a direct result of this action. Not to mention that this was a very difficult XXXX due to the loss of my daughter and the reduction of my credit lines significantly impacted my ability to provide XXXX for my XXXX young grandchildren who have lost their mother. 

Santander needs to make monetary reparations for the damage to my credit report, my loss of companionship with my significant other, the stress and hardship placed upon me by their failure to acknowledge and correct this issue in a timely manner, for their failure to at a minimum provide an emailed explanation to enable me to being pre-approval for a home loan and for the large amount of time that I have spent attempting to correct this egregious error. I am now demanding reparations in the amount of no less than {$250000.00} be paid in remuneration of my losses and the severe emotional stress, pain and suffering they have caused me which I find to be more than reasonable considering the damage they have caused. 

In closing I should add that after a serious accident in XXXX that required numerous XXXX  and extensive medical expenses I needed to use Santander due to poor credit. I have worked very hard to restore my credit and have made the payments to all my revolving accounts with care and diligence and had restored my credit to a reasonable status prior to this event. I find it disturbing that Santander damaged all my hard work over the past 6 years at the end of my loan term after my obligation was paid in full and I have to question their motivations and if they deliberately sabotaged my credit report in order to retain sub-par lending customers. 

While in my case I will rebound in time I would urge the Consumer Protection Agency to look into this matter and see if it is a trend for Santander Customers as well as the ongoing telephone collections using auto-dialers that invaded my privacy up to five times a day starting on the XXXX of the month only 1 day after the payment was " late ''. I find it interesting that the customer service line with Santander identifies itself as a collection agency rather than a customer service agency. 

I also question the practice of forwarding payments rather than applying them to principal enabling Santander to obtain additional interest for the loan periods by doing so. It is my understanding that they have ended this practice after my complaint but it still happened to myself and I am certain many many more customers.

Company response to consumer: Closed with explanation