What is the interest rate charged by Chocolate Bash on late payments?
Chocolate_Bash Franchise · 2024 FDDAnswer from 2024 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| $100 plus interest on | On demand | We may charge a late fee if you fail to | |
| the unpaid amount at | make a required payment when due. | ||
| a rate equal to 18% | |||
| per year (or, if such | |||
| payment exceeds the | |||
| maximum allowed | |||
| by law, then interest | |||
| at the highest rate | |||
| allowed by law) | |||
| $30 (or, if such | |||
| amount exceeds the | |||
| maximum allowed | |||
| by law, then the | |||
| maximum allowed | |||
| by law) |
Source: Item 6 — OTHER FEES (FDD pages 9–13)
What This Means (2024 FDD)
According to Chocolate Bash's 2024 Franchise Disclosure Document, if a franchisee fails to make a required payment when due, Chocolate Bash may charge a late fee. This fee includes interest on the unpaid amount at a rate of 18% per year.
However, the FDD specifies a condition: if this interest rate exceeds the maximum allowed by law, then the interest rate will be the highest rate legally permitted. Additionally, Chocolate Bash may impose a flat fee of $30, but this is also subject to the maximum amount allowed by law.
This means that a prospective Chocolate Bash franchisee could face significant interest charges on overdue payments, but these charges are capped by any applicable legal limits. Franchisees should be aware of these potential costs and ensure timely payments to avoid incurring these fees.