Making overpayments on Santander loans

Alan_b_3

About six months ago I made an overpayment on my personal loan. The terms and conditions stated that if I made a transfer to a particular account number, and didn't call them about it, then the payment would be applied to reduce the term of the loan.

Today I received a statement and the overpayment hadn't been applied. When I called to check this, they said that the overpayment just sits in my loan account and isn't applied unless I call them. They would only apply the payment from today, so basically that money has not been earning interest for me or reducing the cost of my loan for the last six months. Is this right. It seems fair that they back date the payment to when they received it!

bengalknights

Having had a santander loan and done overpayments on my agreement it did actually state you had to call up and request a overpayment for which they then give a reference number and letter for.

JuicyJesus

I don't think it'd be entirely fair for you to be charged interest on that money, and I would wager the Ombudsman would agree. You haven't complied with their T&Cs, no, but this is one of those cases where I think they should use a little discretion. Especially since having to call them up when you send a payment to them is totally unintuitive (why not just apply the payment automatically?)

Write a letter or email to Santander's complaints team. Stick to the facts and state what you want done, short and sweet and leaving emotion out of it - you paid this money into your personal loan under the impression it would reduce the interest you pay and the term of the loan, it has not done so, this is unusual and not intuitive, please could you rework the account as if it had been applied properly. They may uphold, they may not, but it's at least worth a punt.