What is the interest rate charged on late payments to Body Brain Center?
Body_Brain_Center Franchise · 2025 FDDAnswer from 2025 FDD Document
If any sums due under this Agreement have not been received by us when due (or there are insufficient funds in your Account to cover any sums owed to us when due) then, in addition to those sums, you must pay us interest on the amounts past due at the rate equal to the lesser of 18% per annum (prorated on a daily basis), or the highest rate permitted by your State's law.
If no due date has been specified by us, then interest begins to run ten (10) days after we bill you.
Source: Item 23 — RECEIPT (FDD pages 43–178)
What This Means (2025 FDD)
According to Body Brain Center's 2025 Franchise Disclosure Document, if a franchisee fails to make payments on time, Body Brain Center charges interest on the past due amount. The interest rate is the lesser of 18% per annum, prorated daily, or the highest rate permitted by the franchisee's state law. If Body Brain Center does not specify a due date, interest begins to accrue ten days after the franchisee is billed.
This means that franchisees need to be diligent in making timely payments to Body Brain Center to avoid incurring interest charges. The specific interest rate could vary depending on the state where the franchise is located, as it will be capped at the highest rate legally allowed in that state if it is lower than 18%. Franchisees should be aware of their state's laws regarding interest rates to understand the potential maximum charge.
Late fees and interest charges are a common practice in franchising to encourage timely payments and compensate the franchisor for the administrative costs and potential cash flow disruptions caused by late payments. Franchisees should factor these potential costs into their financial planning and ensure they have systems in place to manage payments effectively.