What is the maximum interest rate Cinnaholic charges on overdue amounts?
Cinnaholic Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Interest and Late Payment Fees | Up to the highest rate permitted by law but no more than 18% per annum plus $100 per occurrence | Immediately on demand | Payable on all overdue amounts. Interest begins from the date of non-payment or underpayment. |
Source: Item 6 — OTHER FEES (FDD pages 13–17)
What This Means (2025 FDD)
According to Cinnaholic's 2025 Franchise Disclosure Document, the company charges interest and late payment fees on all overdue amounts. The interest rate can be up to the highest rate permitted by law, but will not exceed 18% per annum. In addition to interest, Cinnaholic also charges a $100 late fee per occurrence. Interest begins accruing from the date of non-payment or underpayment, meaning franchisees should prioritize timely payments to avoid these charges.
Franchisees need to be aware that these charges are "payable immediately on demand," which means Cinnaholic can require immediate payment of overdue amounts, interest, and late fees. This policy underscores the importance of maintaining sufficient cash flow and adhering to the payment schedule outlined in the Franchise Agreement. Failure to do so can result in unexpected financial burdens.
Many franchise systems have similar policies regarding late payments, but the specific interest rates and late fees can vary. The combination of a potentially high-interest rate (up to 18%) and a $100 late fee makes it crucial for Cinnaholic franchisees to manage their finances carefully and ensure all payments are made on time to avoid these additional costs.