Santander Drive Auto Receivables Trust 2022-7 Annual Report

I’ve put together this guide to help you understand how your investment performed this year. Think of this as a "cheat sheet" to help you decide if it still fits your goals.

1. What is this investment?

This isn't a typical company. It is a Trust—a financial vehicle created to hold a pool of auto loans. Santander Consumer USA bundled these loans and sold them to investors in November 2022. Your investment is backed by the monthly payments from the people who took out those car loans.

The Trust’s job is simple: collect payments from borrowers and pass that cash to investors. Its performance depends entirely on the quality of the original $1.26 billion pool of subprime auto loans.

2. Financial performance

The Trust uses a "waterfall" payment structure. Money from car payments flows in, and the Trust pays interest and principal to investors based on their priority (Class A, B, C, and D notes). The Trust has successfully made all scheduled payments to investors, and the "plumbing" of the Trust is working as intended.

3. Major wins and challenges

• Wins: The Trust passed its annual compliance audits for 2025. The companies collecting payments (Santander Consumer USA) and managing the Trust (Citibank) confirmed they are following all agreed-upon standards.
• Challenges: Investors filed a lawsuit on February 3, 2026, against Wilmington Trust (the owner trustee) regarding other deals. While this lawsuit does not claim wrongdoing within this specific Trust, it creates "counterparty risk." If the trustee faces financial or operational trouble, it could create administrative hurdles.

4. Financial health

The Trust remains stable and is currently in the "amortization phase," meaning it is actively paying down the loan balances. The total pool of loans has dropped from the initial $1.26 billion as borrowers pay off their debts.

5. Key risks

• Legal/Reputational Risk: The lawsuit against Wilmington Trust is a factor to watch. If the trustee faces trouble, it could complicate the Trust’s administration or increase administrative costs.
• Borrower Default: These are subprime loans, so some defaults are expected. If defaults exceed the "cushion" provided by junior notes and the reserve account, senior investors could see payment delays.
• Prepayment Risk: If borrowers pay off loans faster than expected, you get your principal back sooner. This may be a disadvantage if you were looking to maintain your interest-earning position for a longer period.

6. Competitive positioning

This is a standard auto-securitization. It competes for investors by offering a specific interest rate spread over benchmarks like SOFR. Its standing is defined by the credit ratings of its notes, ranging from AAA for senior tranches to lower investment-grade ratings for junior tranches.

7. Future outlook

The Trust will continue to wind down as car loans are paid off. We will monitor the "overcollateralization"—the gap between the value of the loans and the value of the notes—to ensure your investment remains protected against future defaults.

Decision Checklist:

• Are you comfortable with the current pace of repayment? The Trust is actively paying down principal, which reduces your total exposure over time.
• How do you feel about the trustee risk? While the Trust itself is performing well, keep an eye on news regarding Wilmington Trust to ensure no administrative disruptions occur.
• Does this fit your risk profile? Remember that this is backed by subprime auto loans; ensure your portfolio is diversified enough to handle the inherent default risks of this asset class.