What interest rate is applied to late payments to Gold Star?
Gold_Star Franchise · 2025 FDDAnswer from 2025 FDD Document
| Type of Fee | Amount | Due Date | Remarks |
|---|---|---|---|
| Late Payment Charge16 | Interest of lesser of 1½% per month or the maximum rate permitted by law, plus $25 | On demand | Payable to Gold Star Non-refundable |
Note 16: Charged on any fee or other payment not paid to Gold Star or any affiliate when due.
Source: Item 6 — OTHER FEES (FDD pages 12–18)
What This Means (2025 FDD)
According to Gold Star's 2025 Franchise Disclosure Document, late payments are subject to an interest charge. Specifically, Gold Star franchisees will be charged the lesser of 1½% per month or the maximum rate permitted by law, in addition to a $25 fee. This late payment charge applies to any fee or other payment not made to Gold Star or its affiliates when due.
This means that if a franchisee is late on any payment to Gold Star, they will incur this interest charge and the $25 fee. The interest accrues monthly, so even a short delay can result in additional costs. The 'maximum rate permitted by law' clause protects the franchisee in case state or federal laws have stricter limits on interest rates than Gold Star's standard 1½% per month.
For a prospective franchisee, this highlights the importance of making all payments to Gold Star on time to avoid these additional charges. It also demonstrates that Gold Star is serious about timely payments and has a clear policy in place for addressing late payments. Franchisees should factor in these potential costs when managing their finances and ensure they have systems in place to meet all payment deadlines.