Motto Mortgage Franchise

Financing Details

Motto Franchising, LLC offers financing for the Renewal Fee. If Motto Franchising, LLC franchisees choose to finance this fee, it will be 50% of the then-current initial franchise fee, plus an additional $1,000. Franchisees must make a cash down payment of at least 50% of the renewal fee when the renewal franchise agreement is signed, and then sign a Promissory Note for the remaining balance. Payments on the Promissory Note begin 90 to 120 days after the renewal agreement is signed and are made in 12 equal monthly installments. If a payment is late, Motto Franchising, LLC may charge a 10% late fee or demand the full outstanding balance immediately. In case of default, the unpaid amounts will accrue interest at 20% per year (or the maximum legally allowed rate) and franchisees will be responsible for Motto Franchising, LLC's attorney's fees and costs incurred for collection. Transferring the franchise or termination of the agreement will make the entire unpaid balance of the Promissory Note immediately due. Franchisees may prepay the principal balance at any time without penalty.

Litigation Summary

Motto Franchising, LLC initiated four lawsuits against franchisees during its 2024 fiscal year. One case, filed July 29, 2024, is against Brooke Marin and Marin AB Holdings, LLC for alleged breach of a franchise agreement and a prior settlement agreement, including confidentiality and non-disparagement provisions. Motto Franchising, LLC is seeking injunctive relief, past due fees, and attorney's fees; a motion to dismiss was denied on February 11, 2025, and the case remains pending. The other three lawsuits are for collection of royalty payments: one against Patrick Winsey, Jemila Winsey, and Steven Griffin (filed March 6, 2024, with a default judgment entered October 9, 2024); one against Free Lunch LLC, Andrew Chock, and Simon Overmiller (filed September 6, 2024, and pending); and one against Michael Guimares, Jr. (filed July 3, 2024, and pending). Motto Franchising, LLC has no other litigation required to be disclosed.

Renewal Conditions

To renew their franchise relationship, Motto Mortgage franchisees must have fully complied with all terms of the franchise agreement throughout its term, diligently developed their office to its full potential, authorize a consumer report and credit and background check, and provide a copy of their current financial statement. They must also meet Motto Mortgage's then-current subjective and objective standards for new franchisees, provide written notice of their election to renew at least 6 months but no more than 12 months before the agreement expires, complete any required education courses, and sign Motto Mortgage's then-current franchise agreement (which may have materially different and less favorable terms) at least 90 days prior to expiration. Additionally, franchisees must pay the renewal fee at least 90 days prior to the expiration of the franchise agreement. For Branch Offices, the franchisee must pay the renewal fee and sign the then-current Branch Office Amendment 90 days before expiration, contingent on Motto Mortgage continuing the Branch Office concept.

Staffing Notes

Motto Mortgage offices must have a fully trained, full-time manager, who can either be the owner or an employee, responsible for direct supervision. Additionally, each office must be staffed with at least one full-time licensed loan originator. Motto Mortgage must be notified if more than three loan originators work in an office, as this may incur additional fees. Both the manager and all loan originators are required to hold valid licenses and complete satisfactory education. The manager must dedicate sufficient time and effort to the office's management and supervision. Motto Franchising, LLC emphasizes that franchisees are solely responsible for all employment decisions and ensuring compliance with federal and state regulations, as well as maintaining high standards of customer relations and ethical conduct.