What interest rate may Caption By Hyatt charge on past due amounts, and how is it calculated?
Caption_By_Hyatt Franchise · 2025 FDDAnswer from 2025 FDD Document
If Owner fails to make any payment when due then, in addition to all other remedies that may be available, Hyatt may charge interest on the past due amount at the rate of 1.5% per month calculated daily and compounded monthly or, if lower, the highest rate permitted under applicable law.
Source: Item 23 — Receipts (FDD pages 85–349)
What This Means (2025 FDD)
According to the 2025 Franchise Disclosure Document, Caption By Hyatt may charge interest on past due amounts. Specifically, if a franchisee fails to make payments when due, Caption By Hyatt has the right to charge interest on the outstanding amount.
The interest rate is calculated at 1.5% per month, compounded monthly and calculated daily. However, the FDD stipulates that if applicable law sets a lower maximum interest rate, that lower rate will be applied instead. This ensures that Caption By Hyatt remains compliant with all relevant legal restrictions regarding interest charges.
For a prospective Caption By Hyatt franchisee, this means that late payments can result in significant additional costs. The 1.5% monthly interest rate (equivalent to an annual rate of 18%) is relatively high compared to standard bank lending rates, so it is crucial to manage finances to avoid late fees. Franchisees should be aware of this policy and factor it into their financial planning to avoid incurring these charges.