Does Degree Financial require a down payment for equipment financing for Degree Wellness franchises?
Degree_Wellness Franchise · 2025 FDDAnswer from 2025 FDD Document
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. If you do not pay our them the entire balance, and any accrued, unpaid interest, you may be responsible for the court costs and attorneys' fees Degree Financial incurs in collecting the debt from you. We may terminate your franchise agreement if you do not pay Degree Financial.
Source: Item 10 — Financing (FDD pages 31–32)
What This Means (2025 FDD)
According to Degree Wellness's 2025 Franchise Disclosure Document, Degree Financial does not require a down payment for equipment financing. Degree Financial may provide financing for a portion of the required equipment to qualified franchisees. The decision to finance is based on creditworthiness, collateral, and the company's current financing policies.
Degree Financial's standard financing can be up to $151,000 for those who meet certain requirements. Franchisees must meet credit standards to qualify for financing. The interest rate is variable, set at Prime + 7%. If Degree Financial agrees to finance equipment, the franchisee must sign a promissory note upon signing the franchise agreement and repay the balance in monthly installments.
Payments are made via automatic bank draft, starting about a month after training completion. The repayment term is negotiable, up to a maximum of 5 years. Degree Financial requires a security interest in the Degree Wellness franchise and a security agreement granting them interest in all assets, including after-acquired property. They will also file a UCC financing statement. Franchisees can prepay the note without penalty, but defaulting may result in the entire remaining amount becoming due, along with responsibility for court costs and attorney's fees incurred during debt collection.