Does Canopy Lawn Care charge interest on late charges?
Canopy_Lawn_Care Franchise · 2025 FDDAnswer from 2025 FDD Document
standing principal and interest balances owing under this Note, if not sooner paid, will be due and payable in full.
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- All payments shall be made by preauthorized Automated Clearinghouse transactions ("ACH") or by such other reasonable method as holder directs at a bank specified by maker in writing to the holder as specified above.
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- Any payment is late if not received by holder within 10 days after it is due. If a payment is late, holder may, in its sole discretion elect to;
- A. Declare the entire unpaid principal and interest balances immediately due and payable; or
- B. Accept the late payment along with a late charge in the amount of 10% of the amount of the late payment. The late charge will be for the purpose of compensating holder for additional expenses which it is recognized that holder will incur as a result of the late payment.
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- All payments, as of the date they are received, will first be credited to any late charges due; the balance, if any, will then be credited to the outstanding interest balance; and the balance, if any, will then be credited to the outstanding principal balance.
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Source: Item 23 — RECEIPT (FDD pages 55–199)
What This Means (2025 FDD)
According to the 2025 Canopy Lawn Care FDD, late payments may incur interest. Specifically, if a payment is not received within 10 days of the due date, Canopy Lawn Care, at its discretion, can either declare the entire unpaid balance immediately due or accept the late payment with a charge of 10% of the late payment amount. This late charge is intended to cover the additional expenses Canopy Lawn Care anticipates incurring due to the late payment.
Furthermore, if Canopy Lawn Care demands full payment after providing written notice and a 10-day grace period, any outstanding principal, interest, and late charges will accrue interest from the original due date of the delinquent payment at a default rate of 18% per year. If this rate exceeds the maximum permitted by law, the interest rate will be the highest rate legally allowed.
Additionally, any rental payment or other amount owed by the Lessee to the Lessor which is not paid within twenty (20) days after its due date will accrue interest, payable on demand of Lessor, from the date due until paid in full at a rate per annum equal to the lesser of (i) Eighteen Percent (18%) per annum or (ii) the highest rate permitted by applicable law (the "Default Rate").
This policy incentivizes franchisees to make timely payments to avoid additional charges and higher interest rates on outstanding balances. Franchisees should be aware of these terms to manage their finances effectively and avoid potential penalties.