Cars are advertised for leasing at annual rates of 14% to 15%, but some Azerbaijani customers say the actual cost becomes much higher when commissions and additional payments appear in the contract.
A television report cited complaints from customers who could not obtain the promoted terms when signing the documents. One customer said an advertised monthly payment of 590 manats rose to about 700 manats after additional costs were included.
The report also described a difference between the advertised rate of 14% to 15% and an effective cost that can reach 22% or more in some offers. These are examples from complaints, not a single rate applied across the market.
The Nominal Rate Does Not Show Every Cost
Lawyer Akram Hasanov said advertisements often display the nominal interest rate, while the total cost also depends on commissions and other mandatory payments.
A rate may also be advertised as a minimum starting figure. Final terms can depend on the customer’s ability to pay, the financing period and the price of the vehicle.
Hasanov said a customer may challenge an advertisement that creates a false impression about the available terms. A normal difference between nominal and effective rates, however, must be distinguished from a case in which the customer was promised one payment and offered another.
Higher Payments Make Purchases Harder
Lawmaker Vugar Bayramov called for reducing the cost of vehicle financing and making it more accessible. He said burdensome terms can prevent people from buying a car and create repayment problems after a contract is signed.
When comparing offers, customers must consider not only the advertised percentage but the full set of required costs: the down payment, monthly installments, commissions and the conditions for completing the agreement. Those figures determine the vehicle’s final cost.
Source: Vesti Baku.