For Beverly Anns Cookie, what is the maximum number of consecutive monthly payments that can be deferred?
Beverly_Anns_Cookie Franchise · 2025 FDDAnswer from 2025 FDD Document
ment Location Address: Transaction Terms/ Payment Schedule: Principal Interest Rate: Term (in months): Payment Amount: Payable Monthly with Amount: First Payment Due:
Deferments:
If Borrower is contractually current on all obligations hereunder, Lender will offer the ability to Defer payments based upon and subject to the following:
- A Deferment payment is a $100 payment made at the time of a regularly scheduled payment for the normal Payment Amount.
- Prior to making a Deferent payment, Borrower must contact Lender by phone to confirm the availability of each proposed Deferment.
- In most instances a Deferment payment will be insufficient to amortize interest and negative amortization will occur. This means that interest will build on the account and remain due.
- Upon an event of Default as referenced below, no Deferment shall be allowed.
This Loan is eligible for Deferments based on the following schedule:
- o For the 12 months after the Date of Note you may Defer up to four (4) single monthly payments.
- o For the 13 24 months after the Date of Note you may Defer up to two (2) single monthly payments.
- o No more than four (4) Deferments may be used consecutively.
- o Deferments are not cumulative,
Source: Item 22 — CONTRACTS (FDD page 57)
What This Means (2025 FDD)
According to Beverly Anns Cookie's 2025 Franchise Disclosure Document, a borrower who is contractually current on all obligations has the option to defer payments, subject to certain conditions. For the first 12 months after the date of the loan note, a franchisee may defer up to four single monthly payments. Between months 13 and 24, up to two single monthly payments can be deferred.
However, no more than four deferments may be used consecutively. This means a Beverly Anns Cookie franchisee could defer up to four consecutive monthly payments during the first year of the loan. Deferments are not cumulative and cannot be carried over or used after the 24th month from the loan date.
It's important to note that each deferment requires a $100 payment at the time of the regularly scheduled payment. Additionally, because the deferment payment may not cover the full interest, negative amortization can occur, leading to accrued interest on the account. If an event of default occurs, no deferments will be allowed. This deferment option provides some flexibility for franchisees facing temporary financial constraints, but it comes with specific limitations and potential costs that need to be carefully considered.