If 1-800-GOT-JUNK? allows installment payments for the initial franchise fee, will interest be charged if payments are timely?
1_800_Got_Junk Franchise · 2025 FDDAnswer from 2025 FDD Document
We do not generally offer financing. However, we may, in our sole discretion, allow the initial franchise fee with respect to some of the subterritories to be made in equal monthly installments without interest if payments are timely made. Installment arrangements will be described in Schedule B of the Franchise Agreement. Outstanding amounts may be pre-paid at any time without penalty. Late payments will incur interest from and after their respective due dates until paid in full at the rate of 24% per annum or at such other rate as we may specify in writing from time to time or the maximum rate permitted by law if lower. All owners of an entity franchisee must personally guarantee payment of initial franchise fees made through installment arrangements.
We may allow you to operate or service customers in subterritories for which you are paying the initial fee in installments, as long as payments are timely made. However, we reserve the right to not allow you to operate or service customers in any subterritories until you pay the initial fees for those subterritories in full.
Upon material default of installment payments we may, at our option and in our sole discretion, revise your Territory to remove any subterritories for which installment payments are in default, or terminate the Franchise Agreement. Your potential liabilities upon default also include acceleration of amounts due, and payment of collection costs. You are not required to waive defenses or other legal rights, and are not barred from asserting any defenses.
Source: Item 10 — Financing (FDD pages 24–33)
What This Means (2025 FDD)
According to the 2025 FDD, 1-800-GOT-JUNK? may offer installment payments for the initial franchise fee for some subterritories. If 1-800-GOT-JUNK? allows a franchisee to pay the initial franchise fee in equal monthly installments and the franchisee makes timely payments, 1-800-GOT-JUNK? will not charge interest. The specific installment arrangements will be detailed in Schedule B of the Franchise Agreement.
However, if a franchisee is late on payments, interest will be charged from the due date until the payment is made in full. The interest rate will be 24% per annum, or another rate that 1-800-GOT-JUNK? specifies in writing, or the maximum rate permitted by law, whichever is lower. All owners of an entity franchisee must personally guarantee the payment of initial franchise fees made through installment arrangements.
1-800-GOT-JUNK? may allow a franchisee to operate in subterritories while they are still paying off the initial fee, as long as the payments are on time. However, 1-800-GOT-JUNK? reserves the right to prevent a franchisee from operating in any subterritories until the initial fees are paid in full. If a franchisee materially defaults on installment payments, 1-800-GOT-JUNK? may revise the territory to remove subterritories for which payments are in default or terminate the Franchise Agreement. In the event of default, the franchisee may also be liable for accelerated amounts due and collection costs.