When can the note payable to Bank of West be voluntarily prepaid by Closet Storage Concepts?
Closet_Storage_Concepts Franchise · 2025 FDDAnswer from 2025 FDD Document
| The following is a summary of long‐term debt obligations at December 31, 2022: | |
|---|---|
| Note payable to GM Financial. The loan is payable over 72 months at $493 per | 981 |
| month at 4.9% interest and matures February 2023. The loan is collateralized by | |
| a | |
| vehicle. | |
| Note payable to GM Financial. The loan is payable over 72 months at $519 per | 9,372 |
| month at 5.99% interest and matures July 2024. | |
| The loan is collateralized by a | |
| vehicle. | |
| Note payable to GM Financial. The loan is payable over 72 months at $519 per | 9,372 |
| month at 5.99% interest and matures July 2024. | |
| The loan is collateralized by a | |
| vehicle. | |
| Note payable to Bank of West. The loan is payable over 84 months at $1,456 per | 27,809 |
| month at 5.34% interest an |
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 59)
What This Means (2025 FDD)
According to Closet Storage Concepts's 2025 Franchise Disclosure Document, the note payable to Bank of West could be voluntarily prepaid after the initial 12 payments. The loan was payable over 84 months at $1,456 per month with a 5.34% interest rate and matured in August 2024. The loan was collateralized by equipment, as detailed in the financial statements.
This information is relevant to potential franchisees as it provides insight into the debt obligations of Closet Storage Concepts. Understanding the terms of existing loans, such as interest rates, maturity dates, and prepayment options, helps franchisees assess the financial stability and management practices of the company. Knowing that a loan can be prepaid after a certain period offers flexibility in financial planning and potentially reduces long-term interest costs.
However, it's important to note that this specific loan matured in August 2024. While the 2025 FDD mentions the terms under which it could have been prepaid, it does not provide information on whether the loan was actually prepaid or if it was refinanced under different terms. A prospective franchisee should inquire about the current status of this debt and any similar obligations Closet Storage Concepts may have.