Is Degree Financial obligated to provide financing to Degree Wellness franchisees?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
. We do not offer any other direct or indirect financing.
General Equipment Financing
Degree Financial has no obligation to provide you any financing, but it may agree to finance a portion of the required equipment for qualified prospective franchisees under specified terms and conditions. Its decision to finance any equipment will be based, in part, on your creditworthiness, the collateralization of the equipment and other collateral you have available to secure the financing and our then-current financing policies.
Degree Financial limits the amount that it will finance. Its standard financing is up to $151,000 if you meet certain requirements. We may elect not to approve a transfer, including a transfer to a corporation or other entity wholly owned by you, if you do not pay any loans payable to us and or Degree Financial in full.
You must qualify to purchase a franchise, meet our credit standards and be otherwise eligible for financing to qualify. Degree Financial currently charges a variable interest rate of Prime + 7%. If it agree to finance a portion of the required equipment, you must sign a promissory note when you sign your franchise agreement and pay the balance in monthly installments. Degree Financial does not require any money down.
You must make note payments by automatic bank draft. Some banks and other financial institutions may charge a fee for electronic transfers. Monthly payments will begin approximately 1 month after you complete Training. The length of the repayment term may be negotiable up to a maximum of 5 years.
Degree Financial requires a security interest in the Studio franchise. You must sign a security agreement granting it a security interest in all your assets, including after acquired property and it will file a UCC financing statement with the appropriate governmental authority. It has the right to require additional forms of security.
You may prepay the note at any time without penalty. If you default, Degree Financial may declare the entire remaining amount due.
Source: Item 10 — Financing (FDD pages 31–32)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, Degree Financial, an affiliate of Degree Wellness, is not obligated to provide financing to franchisees. While Degree Financial may choose to finance a portion of the required equipment for qualified prospective franchisees, this is not a requirement. The decision to provide financing is based on factors such as the franchisee's creditworthiness, the availability of collateral, and Degree Financial's current financing policies. Degree Financial standard financing is up to $151,000 if certain requirements are met.
To qualify for financing from Degree Financial, prospective Degree Wellness franchisees must meet the franchisor's credit standards and be otherwise eligible for financing. If Degree Financial agrees to provide financing, the franchisee will be required to sign a promissory note and make monthly payments, with the interest rate currently set at Prime + 7%. The repayment term is negotiable up to a maximum of 5 years, and Degree Financial requires a security interest in the Studio franchise and a security agreement granting them a security interest in all the franchisee's assets.
Degree Wellness may also periodically agree with third-party lenders to make financing available to qualified franchisees and may refer franchisees to these lenders at their sole discretion. However, neither Degree Wellness nor the third-party lenders are obligated to provide financing. Degree Wellness does not guarantee a franchisee's obligations to third parties. Degree Wellness does not currently derive income from referrals or placement of financing with any third-party lender, but they may require payment for these services in the future to offset their expenses.