What is the monthly interest rate charged by 1 800 Packouts on late payments?
1_800_Packouts Franchise · 2025 FDDAnswer from 2025 FDD Document
bit or credit entries and/or credit collection entries to your bank and that you make funds available for withdrawal by EFT no later than the due date for payment. We reserve the right to collect these fees on a weekly basis if you are delinquent in any Royalty Fees or Marketing Fee payments three times in any 12-month period.
H. INTEREST ON LATE PAYMENTS
All amounts which you owe to us will bear interest after the due date at the rate of 5% per month or the highest rate permitted by law, whichever is less. If any payment of any amounts due to us is returned or declined because of insufficient funds in your account, we have the right to charge you $150 for each returned check or declined withdrawal. You acknowledge that this Section F. does not constitute our agreement to accept such paym
Source: Item 23 — RECEIPT (FDD pages 67–238)
What This Means (2025 FDD)
According to 1 800 Packouts's 2025 Franchise Disclosure Document, any amounts owed to 1 800 Packouts that are not paid by the due date will incur interest. The interest rate is 5% per month, or the highest rate permitted by law, whichever is less. Additionally, if a payment is returned or declined due to insufficient funds, 1 800 Packouts has the right to charge a fee of $150 for each returned check or declined withdrawal.
This means that if a 1 800 Packouts franchisee is late on payments, they will be charged interest on the outstanding balance. The 5% monthly interest rate can quickly add up, making it crucial for franchisees to manage their finances responsibly and ensure timely payments. The $150 fee for returned or declined payments further emphasizes the importance of maintaining sufficient funds in the account used for payments to 1 800 Packouts.
It is important to note that 1 800 Packouts's acceptance of late payments or charging interest does not constitute an agreement to extend credit or finance the franchisee's business. Furthermore, failure to pay amounts when due can be grounds for termination of the Franchise Agreement. Franchisees should be aware of these terms and conditions to avoid penalties and potential termination of their franchise agreement.
1 800 Packouts retains sole discretion in applying payments received from franchisees to any past due indebtedness, including Royalty Fees, Marketing Fees, or interest. Franchisees must adhere to the approved method of payment as outlined in the operations manual. 1 800 Packouts also reserves the right to collect fees on a weekly basis if a franchisee is delinquent in Royalty Fees or Marketing Fee payments three times in any 12-month period.