AFIP Basic Certification Course – AFIP –
Practice Questions with Answers and
Complete Exam Preparation Material
Introduction:
This document contains 151 practice questions and answers for
the AFIP Basic Certification Course, focused on federal
regulations affecting automotive F&I professionals. It covers
TILA/Regulation Z, CLA/Regulation M, ECOA/Regulation B,
FCRA, the Used Car Rule, Risk-Based Pricing, UDAP/UDAAP,
advertising compliance, contract law fundamentals, and
dealership best practices.
The material is structured in a true/false and multiple-choice
format, making it ideal for certification review and final exam
preparation. It also addresses disclosure requirements, civil
and criminal penalties, creditor responsibilities, and
compliance procedures relevant to dealership operations.
Exam Questions and Answers:
1. Which of the following regulations implements the Truth
in Lending Act?---Correct Answer---D. Regulation Z
2. (True/False)The Truth in Lending Act (TILA) is
implemented by Regulation Z---Correct Answer---True
,3. THE APR is a mandated disclosure. It must be used in oral
discussion with a customer, in funding-related advertisements,
and on the retail installment sale agreement. A customer asks,
what does the APR mean? Your response should be---Correct
Answer---B. That's the "cost of credit" as a yearly rate
4. (True/False)State law can require additional disclosures
beyond those mandated by the TILA, Reg. Z---Correct Answer--
-True
5. (True/False)All of the following items are Truth in
Lending Act or Reg. Z disclosure box items:
A. The amount financed
B. The total of the payments
C. The dollar or percentage charged due to a late payment
D. The cost of an oil change
E. The payment schedule - the number, amounts, and timing
of payments---Correct Answer---False.
D. The cost of an oil change is not included.
6. (True/False)All of the following items are triggering
terms on an advertisement for an installment sale:
A. The number or percentage of any down payment
B. The number of payments or the contract term
C. The amount of any payment
, D. The amount of any finance charge---Correct Answer---
True
7. At the point in the financing process where the retail
installment sale agree- ment is to be disclosed to the customer,
at that point in time the parties to the contract are the
customer and the .---Correct Answer---B. Selling dealer
8. As recorded on an installment sale agreement the total
price or deferred contract price would be the total of the .--
-Correct Answer---D. All of the above
9. (True/False)Whenever discussing financing with a
prospective customer regarding the cost of credit, regardless
of it's in a oral discussion, advertisement, or during dis- course
on an installment sale contract, the term "APR" or "annual
percentage rate" should be used.---Correct Answer---True
10. What is the maximum criminal liability for willful and
knowing violation of TILA Reg Z and or CLA Reg M?---Correct
Answer---D. $5,000 fine, 1 year imprisonment, combination of
both
11. (True/False)According to Regulation Z, down payment
and total sale price must be dis- closed.---Correct Answer---
True
12. (True/False)Any communication to a single individual -
verbally or in writing does not meet standards for an
advertisement.---Correct Answer---True
Practice Questions with Answers and
Complete Exam Preparation Material
Introduction:
This document contains 151 practice questions and answers for
the AFIP Basic Certification Course, focused on federal
regulations affecting automotive F&I professionals. It covers
TILA/Regulation Z, CLA/Regulation M, ECOA/Regulation B,
FCRA, the Used Car Rule, Risk-Based Pricing, UDAP/UDAAP,
advertising compliance, contract law fundamentals, and
dealership best practices.
The material is structured in a true/false and multiple-choice
format, making it ideal for certification review and final exam
preparation. It also addresses disclosure requirements, civil
and criminal penalties, creditor responsibilities, and
compliance procedures relevant to dealership operations.
Exam Questions and Answers:
1. Which of the following regulations implements the Truth
in Lending Act?---Correct Answer---D. Regulation Z
2. (True/False)The Truth in Lending Act (TILA) is
implemented by Regulation Z---Correct Answer---True
,3. THE APR is a mandated disclosure. It must be used in oral
discussion with a customer, in funding-related advertisements,
and on the retail installment sale agreement. A customer asks,
what does the APR mean? Your response should be---Correct
Answer---B. That's the "cost of credit" as a yearly rate
4. (True/False)State law can require additional disclosures
beyond those mandated by the TILA, Reg. Z---Correct Answer--
-True
5. (True/False)All of the following items are Truth in
Lending Act or Reg. Z disclosure box items:
A. The amount financed
B. The total of the payments
C. The dollar or percentage charged due to a late payment
D. The cost of an oil change
E. The payment schedule - the number, amounts, and timing
of payments---Correct Answer---False.
D. The cost of an oil change is not included.
6. (True/False)All of the following items are triggering
terms on an advertisement for an installment sale:
A. The number or percentage of any down payment
B. The number of payments or the contract term
C. The amount of any payment
, D. The amount of any finance charge---Correct Answer---
True
7. At the point in the financing process where the retail
installment sale agree- ment is to be disclosed to the customer,
at that point in time the parties to the contract are the
customer and the .---Correct Answer---B. Selling dealer
8. As recorded on an installment sale agreement the total
price or deferred contract price would be the total of the .--
-Correct Answer---D. All of the above
9. (True/False)Whenever discussing financing with a
prospective customer regarding the cost of credit, regardless
of it's in a oral discussion, advertisement, or during dis- course
on an installment sale contract, the term "APR" or "annual
percentage rate" should be used.---Correct Answer---True
10. What is the maximum criminal liability for willful and
knowing violation of TILA Reg Z and or CLA Reg M?---Correct
Answer---D. $5,000 fine, 1 year imprisonment, combination of
both
11. (True/False)According to Regulation Z, down payment
and total sale price must be dis- closed.---Correct Answer---
True
12. (True/False)Any communication to a single individual -
verbally or in writing does not meet standards for an
advertisement.---Correct Answer---True
