Below the waterline, mostly. If I'm finishing off a ship, I start by bombarding the spot where the torpedo hit. It's already severely damaged and little more often does the trick, especially with tankers. Actually, I start by getting rid off the gun stations first
While at it, I usually fire at the cargo couple of times to see if it'd blow up. It does work, shooting at the deck cargo, though not always . I just finished off a C2 with a five shots from 105mm after hitting the rear of the ship with torp. Nice.