When is the pro-rated payment due under the Chesters EFA?
Chesters Franchise · 2025 FDDAnswer from 2025 FDD Document
Payments: You agree to pay us: (a) the number of payments in the amount(s) shown above (each a "Payment") plus (b) a pro-rated payment equal to 1/30th of a standard Payment times the number of days from the funding date of the loan (the "Commencement Date") to the first monthly due date specified by us (the "First Due Date").
The interest rate stated above excludes this pro-rated payment and all fees.
The pro-rated payment is due on the First Due Date, and the first Payment is due either in advance, on the First Due Date, or on the second Due Date, as specified by us.
Subsequent Payments are due on the same day of each month thereafter (the period from the Commencement Date until full payment and performance of your obligations, the "Term").
Source: Item 23 — **RECEIPTS (FDD pages 48–197)
What This Means (2025 FDD)
According to Chesters's 2025 Franchise Disclosure Document, the pro-rated payment under the Equipment Finance Agreement (EFA) is due on the First Due Date. This pro-rated payment is calculated as 1/30th of a standard Payment multiplied by the number of days between the loan's Commencement Date (the first funding date) and the First Due Date, which is specified by Chesters.
This pro-rated payment compensates Chesters for the interest accruing on the loan during the partial month between the Commencement Date and the First Due Date. It's important to note that the stated interest rate excludes this pro-rated payment and all fees, so franchisees should factor this additional cost into their initial financial planning.
Chesters also specifies that the first Payment is due either in advance, on the First Due Date, or on the second Due Date, as specified by them. Subsequent Payments are then due on the same day of each month thereafter for the duration of the Term. Franchisees should clarify with Chesters the exact First Due Date and payment schedule to ensure timely payments and avoid any late charges or other penalties.