MICHIGAN COLLECTION AGENCY MANAGER LICENSE LATEST EXAM QUESTIONS AND SOLUTIONS - VERIFIED ANSWERS - STUDENT SUCCESS GUIDE

1. Which Michigan law primarily regulates collection agencies?
A. Michigan Penal Code
B. Occupational Code
C. Fair Credit Reporting Act
D. Uniform Commercial Code
ANSWER : B
Explanation: Michigan collection agencies are regulated under the Michigan
Occupational Code (Act 299 of 1980).


2. Who must be licensed to manage a collection agency in Michigan?
A. Any senior employee
B. The owner only
C. Each agency manager
D. All collectors
ANSWER : C
Explanation: Michigan requires each collection agency manager to be
licensed separately.


3. Which agency oversees collection agency licensing in Michigan?
A. Attorney General
B. Department of Insurance and Financial Services (DIFS)
C. Secretary of State
D. Department of Labor
ANSWER : B
Explanation: DIFS regulates and licenses collection agencies and managers in
Michigan.

,4. A collection agency manager license is valid for:
A. 1 year
B. 2 years
C. 3 years
D. 5 years
ANSWER : B
Explanation: Michigan manager licenses are issued for two-year periods.


5. Which activity requires a collection agency license?
A. Collecting your own debts
B. Collecting debts for another for compensation
C. Legal representation in court
D. Credit counseling
ANSWER : B
Explanation: A license is required when collecting debts owed to another
party for pay.


6. Which debt is covered under Michigan collection law?
A. Business-to-business only
B. Consumer debts only
C. Personal, family, or household debts
D. Tax debts
ANSWER : C
Explanation: The law focuses on personal, family, or household obligations.


7. What is the minimum age to be licensed as a manager?
A. 18
B. 19
C. 21
D. 25
ANSWER : C
Explanation: Applicants must be at least 21 years old.

,8. Which is required for a manager license application?
A. Credit report
B. Fingerprints
C. Background investigation
D. Notarized affidavit only
ANSWER : C
Explanation: Michigan requires a background investigation to ensure good
moral character.


9. What character standard must an applicant meet?
A. Financial solvency only
B. Good moral character
C. No prior lawsuits
D. College degree
ANSWER : B
Explanation: Applicants must demonstrate good moral character and fitness.


10. Which action is prohibited under Michigan law?
A. Sending written notices
B. Calling debtors at work with permission
C. Threatening arrest for nonpayment
D. Reporting accurate credit data
ANSWER : C
Explanation: Threats of arrest or criminal prosecution are strictly
prohibited.


11. When may a collector contact a debtor?
A. Anytime
B. 6 a.m. – 10 p.m.
C. 8 a.m. – 9 p.m.
D. Business hours only

, ANSWER : C
Explanation: Contact is limited to 8 a.m. to 9 p.m. unless consent is given.


12. What must a collector disclose in the first communication?
A. Company profits
B. Debt amount and purpose
C. Manager’s license number
D. Court filing intent
ANSWER : B
Explanation: Initial notice must state amount owed and collection purpose.


13. Harassing conduct includes:
A. One phone call
B. Polite reminders
C. Repeated calls to annoy
D. Written communication
ANSWER : C
Explanation: Repeated calls intended to harass are unlawful.


14. Which practice is deceptive?
A. Using the agency’s legal name
B. Misrepresenting debt amount
C. Sending validation notices
D. Accepting partial payments
ANSWER : B
Explanation: False or misleading representations violate the law.


15. What is required when a debtor disputes a debt?
A. Continue collection
B. Ignore dispute
C. Cease collection until verification
D. File a lawsuit