Can a borrower prepay the Aunt Millies Bakeries loan in full?
Aunt_Millies_Bakeries Franchise · 2025 FDDAnswer from 2025 FDD Document
4. BORROWER'S RIGHT TO PREPAY
Borrower may at any time pay the full amount of this Note (without prepayment penalty but together with any accrued but unpaid interest thereon).
Source: Item 23 — RECEIPT (FDD pages 44–196)
What This Means (2025 FDD)
According to the 2025 Aunt Millies Bakeries FDD, a borrower has the right to prepay their loan. Specifically, the borrower may pay the full amount of the promissory note at any time. This can be done without incurring any prepayment penalty. However, the borrower is still responsible for paying any interest that has accrued on the loan but remains unpaid at the time of prepayment.
This policy benefits franchisees by providing them with flexibility in managing their debt. If a franchisee's financial situation improves, they can reduce their debt obligations without penalty. This could free up cash flow and reduce overall interest expenses.
It is important for prospective Aunt Millies Bakeries franchisees to fully understand the terms of the promissory note and loan agreement, including the conditions under which prepayments can be made and how accrued interest is calculated. This information can help them make informed decisions about managing their financing and overall business strategy.