At what monthly interest rate will overdue amounts from me to Focalpoint Coaching accrue interest?
Focalpoint_Coaching Franchise · 2025 FDDAnswer from 2025 FDD Document
K. LATE FEES AND INTEREST.
If Franchisee is late in any payment under this Agreement, Franchisee shall pay Franchisor an amount equal to eighteen percent (18%) of the amount owed as an administrative fee to compensate Franchisor for its increased costs and expenses. In addition, all amounts which Franchisee owes Franchisor for any reason, will bear interest accruing as of their original due date at one and one half percent (1.5%) per month or the highest commercial contract interest rate the law allows, whichever is less. Franchisor may debit Franchisee's bank account automatically for late fees and interest. Franchisee acknowledges that this Subsection 3.K is not Franchisor's agreement to accept any payments after they are due or Franchisor's commitment to extend credit to, or otherwise finance Franchisee's operation of, the Franchised Business.
Source: Item 22 — Contracts (FDD pages 56–57)
What This Means (2025 FDD)
According to Focalpoint Coaching's 2025 Franchise Disclosure Document, if a franchisee is late on any payments, the overdue amount will accrue interest. The interest rate is 1.5% per month, or the highest commercial contract interest rate the law allows, whichever is less. In addition to the interest, Focalpoint Coaching will charge an administrative fee equal to 18% of the amount owed to compensate them for increased costs and expenses.
Focalpoint Coaching has the right to automatically debit the franchisee's bank account for these late fees and interest charges. However, this does not obligate Focalpoint Coaching to accept late payments or extend credit to the franchisee for operating the franchised business.
This is a fairly standard practice in franchising, where franchisors charge interest and late fees to encourage timely payments and to cover the administrative costs associated with collecting overdue amounts. Prospective franchisees should be aware of these terms and ensure they have sufficient capital and cash flow to meet their payment obligations to Focalpoint Coaching on time.