What is the late charge for overdue payments to Americas Best Value Inn?
Americas_Best_Value_Inn Franchise · 2025 FDDAnswer from 2025 FDD Document
- (d) Late Charges. If any payment under this Agreement or any other agreement between you and us is overdue for any reason you will pay to us on demand a late charge equal to the lesser of (a) 1.5% of the overdue amount or (b) the maximum rate allowed by law.
If a greater amount than may be lawfully
collected is inadvertently collected, it will be applied to reduce outstanding amounts owed under this Agreement. You acknowledge and agree that if you fail to pay any amounts when due, we may report your delinquent payment to credit bureaus.
Source: Item 23 — RECEIPTS (FDD pages 71–223)
What This Means (2025 FDD)
According to Americas Best Value Inn's 2025 Franchise Disclosure Document, if a franchisee's payment is overdue, Americas Best Value Inn will charge a late fee. This late charge is the lesser of two options: either 1.5% of the overdue amount, or the maximum rate allowed by law.
This means that if a franchisee owes $1,000 and the maximum legal late fee is 1%, Americas Best Value Inn would charge $10 (1% of $1,000). However, if the maximum legal rate was 2%, the late fee would be $15 (1.5% of $1,000) because that is less than the legal maximum. This protects the franchisee from excessive late fees while ensuring Americas Best Value Inn is compensated for the delayed payment.
Americas Best Value Inn also states that if they inadvertently collect a greater amount than is lawfully allowed, the excess will be applied to reduce any other outstanding amounts owed by the franchisee under the Franchise Agreement. Furthermore, Americas Best Value Inn may report any delinquent payments to credit bureaus, which could negatively impact the franchisee's credit rating.