If a Deck Medic franchisee requests indirect financing, does Deck Medic receive a referral fee?
Deck_Medic Franchise · 2024 FDDAnswer from 2024 FDD Document
tional affiliates as potential lenders in the future. We may in the future also provide indirect financing through third parties and receive referral fees from these third party providers. The terms of your financing with third parties will vary. If you request indirect financing, we may receive a referral fee from the third party financing provider. We do not guarantee your note, lease or obligation.
We will provide a promissory note (a "Note") for the amount financed and any financing charges that you, or, if you are a Corporate Entity, each of your members, shareholders, and partners and each of these parties' spouses must sign the Note if we agree to offer you direct financing on your Initial Franchise Fee. You are required to return an original signed copy of the Note to us. We have the right to assign your Note to a third party. Additionally, if you enter into a Note with us for a new Deck Medic Business, we require that you open the Deck Medic Business within six months of your receipt of the funding provided under the Note.
The financing terms we currently offer is described in the tables below:
| Finance Type | Direct – Initial | Indirect |
|---|---|---|
| Franchise Fee | ||
| Amount | $20,000 | As agreed |
| Financed | ||
| Down | $10,000 | As agreed |
| Payment | ||
| Term | 36 months | As agreed |
| Interest | 8% APR or the highest rate allowed by law | As agreed |
| Finance | None if paid in full within term | As agreed |
| Charges | ||
| Payment | \ |
Source: Item 10 — FINANCING (FDD pages 23–24)
What This Means (2024 FDD)
According to Deck Medic's 2024 Franchise Disclosure Document, if a franchisee requests indirect financing, Deck Medic may receive a referral fee from the third-party financing provider. This means that Deck Medic has the potential to earn additional revenue by connecting franchisees with lenders. The terms of financing are agreed upon between the franchisee and the third-party lender.
This arrangement is common in franchising, as it allows franchisors to assist franchisees in securing necessary funding while also generating income for themselves. However, the FDD does not specify the amount or percentage of the referral fee that Deck Medic receives. Prospective franchisees should inquire about the typical referral fee amount to understand the potential cost implications.
Furthermore, the table outlines the terms for both direct and indirect financing. For indirect financing, the amount financed, down payment, payment terms, interest rate, finance charges, security required, liability upon default, loss of legal rights on default, and referral fee are all "As agreed," indicating these terms are negotiated between the franchisee and the third-party lender. This means that franchisees need to carefully review and understand the terms of any indirect financing offered, as they may vary significantly. Deck Medic does not guarantee any financing obtained through a third party.