Consumer complaint received 2022-10-01
Company: SANTANDER HOLDINGS USA, INC.
State: AR
Product: Vehicle loan or lease
Sub-product: Loan
Issue: Managing the loan or lease
Sub-issue: Billing problem

Complaint:
Good Day, I have an account with Chrysler Capital for a vehicle loan. XXXX XXXX XXXX I have been in contact with Chrysler Capital about making additional principle payments to the loan. I had made a payment on XX/XX/XXXX ( {$2500.00} ) & XX/XX/XXXX ( {$2500.00} ) in addition to my monthly payment ( {$790.00} ). hat not all of my additional {$5000.00} was applied to principle. Then informed me that if I wanted the additional payment ( XXXX ) made each month to apply to principle - I would have to make them on the same day my monthly payment is due. They charged interest that was accumulated from the XXXX of the month to XX/XX/XXXX ( Payment ( {$2500.00} ) Break down = Principal ( {$2200.00} ) Interest ( {$210.00} ) ), also from the XXXX to the XXXX ( Payment ( {$2500.00} ) Break down = Principal ( {$2400.00} ) Interest ( {$33.00} ) ). During our my conversation with them on the XXXX of XXXX - I stated that my intention was to have the additional payment applied strictly to the principle balance of the loan. I spoke with a manager and she said that they would change the payment distribution. When my next monthly payment was due ( on the XXXX of each month ), I made the additional payment to them as they said needed to be done. 

Now it is XXXX and another monthly payment is due and I am making another large payment to lower my principle balance. I called to day ( XX/XX/XXXX ) to ask why the interest taken from the XXXX payments did not show it distributed back to principle. They told me that, the policy is to pay interest first them principle on any additional payments may to the account. I expressed my disagreement to their policy stating that - other loans allow me to specify the distribution of additional payment - outside my required monthly payment. 

My intention for making these extra payments is to shorten the length of my loan, lower the interest I pay. Their policy is unfair and slanted to benefit them not my interests. I expressed that my monthly payments ( I agree to ) is the place where interest that is accrued during the month is paid. I also expressed that I understand that my monthly payments consist of Interest/Principle - that when I make these extra payments during the month ( if it is XXXX or more payments ) it is beneficial for to do so. It breaks up the interest algorithm that is used to calculate interest, and benefits me more. 

I am concerned that their policy- to pay themselves first before applying my payment to the principle balance is unfair and leads to unnecessary additional interest paid to the company. I am asking you to look into this. My Monthly payments are there to account for the interest accrued during the month - that was the understanding when I took out the loan, also that ( from past loans ) if additional payments are made outside the due date agreed on for the loan, that it would be applied to the principle. 

I see this as an attempt to squeeze out as much interest as they can from the consumer by not allowing strictly principle payment to be applied to the account as the consumer sees. Limiting consumers to making principle payments only on the monthly payment due date appears to be an interest penalty, a way to discourage individuals from paying off their loans quicker. Every dollar that is diverted to pay the interest ( that is accounted for in the monthly payment ) is a dollar more that is used in the daily calculation for interest. 

This practice is unfair, predatory and creates an indebtedness environment that prolongs payments and unfairly burdens the consumer with additional interest payments that was not needed. Please help me with this. Also as you can see on the attached documents I provided - that my first payment when strictly to interest - Not sure why. 


Thank you XXXX XXXX.

Company response to consumer: Closed with explanation