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Santander loan-paying off principal

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Valued Contributor

Santander loan-paying off principal

So I got myself into a Santander loan.  I have been paying a little over my payment amount in an attempt to pay it off quicker and save on the interest.  My payment is $350 and I pay $400 every month.  I know an extra $50/mo isn't a lot but it's what I can comfortably afford right now.  My question is this; how can I get Santander to apply the extra money to the back end/principle only?  I know if they just apply it to the interest side it will not help me with paying less on interest bc I am paying all the interest in the beginning of the loan.

Valued Contributor

Re: much am I going to regret this.

So we are a couple months out and I was just curious if anyone knows about paying off their loan early with Santander?  My payment is $350 and some change but I have been paying $400 every month. I know an extra $50 isn't really a big deal but it's an extra $600 per year and it's what I can comfortable afford right now. actual question.  How can I get Santander to apply it to the principal of my loan and not just apply to the front end with all the interest?

Message 1 of 12
Valued Contributor

Re: much am I going to regret this.

I believe Santander will apply the extra payment to the principal.

This should be a simple interest loan so you should be reducing your principal each month by the additional $50.


Google, 'additional payment calculator auto loan' and this will give you some calculators that will show you what your extra $50 will yield.


I used the Bankrate early payment payoff calculator with the following numbers.

$16,000 at 13% for 60 months paying an additional $50 every month from the beginning.

This shortened the loan by 9 months and saved $1,001 in total interest!


You should do the math each month and ensure that your payment is continuing to drop the principal as much as you expect.


Finally, Santander is not bad and I agree that many of the people who do have trouble have had late payment issues. If you can pay a week prior to the due date, that gives you time to correct any bank issues.


Hopefully that helps and hopefully you can refinance at some point!








Message 3 of 12
Valued Contributor

Re: Santander loan-paying off principal

I answered in your other thread.

However, the Santander loan should be a simple interest loan and any payments will pay off accrued interest and than the principal.

Below I provided an example of how your payment might be applied:


Example, at 13% you are paying 0.0356% interest on the balance each day. (13% / 365 days)

Divide 0.0356% by 100 to get that into decimal form = .000356

Multiply that by current account balance (for example $11,000)

$11,000 X .000356 = $3.916 for interest today on the loan. (Need to do this each month to see your daily interest rate as it goes down as you make payments)

Multiply that by the number of days since last payment (varies between 28 and 31)

$3.916 X 30 days = $117.48 (approximate interest that will accrue on this example loan this month)

Payment of $400 - $117.48 (accrued interest you are paying) = $282.52 in principal paid (without your extra payment it would only be $232.52 in principal paid this month)


In the other post I provided the overall saving of you paying ahead.

Message 4 of 12

Re: Santander loan-paying off principal

 @Shellie I moved your post from original approval of your auto loan(just the duplicate question) into this seperate post as it makes it very hard for forum to help when the same question is asked in multiple threads and just confusing in general.

Message 5 of 12

Re: Santander loan-paying off principal

I had a Santander loan when I was having issues. I would pay and extra half payment and mark interest only on the payment coupon. They always applied it to the principal. I paid my loan off 1 year early and there was no problem releasing my title. I had a good experience with Santander.

Message 6 of 12

Re: Santander loan-paying off principal

Hey if you dont mind me asking do you think santander will give me a car loan for 19K i am freshly 18 with a credit score of 550 from student loans from last semester of college i dont have anything bad on my credit and i have 100% payment history... Im wondering if its possible to get approved at all for a car loan. Intrest rates dont really matter at this point i just need something in about a year after my credit is established i will refinance. I have been on my job for about a year and a half making around 40k a year any advice or recommendations to specific banks would help thanks.

Message 7 of 12
New Visitor

Re: Santander loan-paying off principal

Good luck. You would think that the extra payment would automatically go towards your principal. After a 2 hour long phone conversation, this morning, I have learned that is not this case with this company. Within the last (less than) 2 months, I have paid this company $1678.43. Less than 500 has been applied to my principal balance (and I do not have a payment due until June 15th.)
Message 8 of 12
Valued Contributor

Re: Santander loan-paying off principal

If it is a simple interest loan, it is automatically applied to principal because the interest has not occured yet.


The only time it will be different is if you have been paying less than minimum or have back fees.


Do you not get a monthly statement showing applied payments?



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Message 9 of 12
New Visitor

Re: Santander loan-paying off principal

That's incorrect information.... even if you make a payment in between payments, all or most can still go to interest...

I just had a 2 hour long phone call with Santander. MY ACCOUNT IS CURRENT, WITH NO PAYMENTS DUE UNTIL 6/15. I made a 700 dollar EXTRA PAYMENT on February 23. I did not have a payment due until 3/15. Only 1/2 went to principal. In April, I made 2-$300 payments and one payment for $378. The first 300, none went to interest....with no past due balances. I can email screenshots of my payments and the principal balances. This company is ripping off BIG TIME.
Message 10 of 12
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