AFIP BASIC CERTIFICATION COURSE
COMPLETE STUDY GUIDE 2026
◉ (True/False): As an F&I manager working directly with
customers, you are individually responsible for your actions and
what you say to each customer. Answer: True
◉ In a typical credit transaction the (bank)/(dealer) is the creditor.
Answer: The dealer is the creditor
◉ What is a contract? Answer: A contract is an agreement involving
a promise or set of promises that the law enforces or protects.
◉ The formation of a contract requires three elements: Answer: 1.
Offer
2. Acceptance
3. Consideration
◉ An offer consists of three elements: Answer: 1. An expression of a
promise or commitment (intent) to enter a contract
2. An expression of definite and certain terms
3. The communication of the offer to the offeree (in this case, the
customer)
,◉ An offer may be terminated by: Answer: 1. An act of the parties
2. The operation of law
◉ There are three criteria for the acceptance of an offer: Answer: 1.
The offer is accepted by one who is entitled to accept
2. The acceptance takes the proper form and is timely
3. The terms of acceptance reflect closely the terms of the offer and,
therefore, do not amount to a counteroffer
◉ The Statute of Frauds Answer: Generally requires that all
contracts involving the sale of goods for a price of $500 or more be
in writing.
◉ The Statute of Frauds requires a written contract for the sale of
goods for a price of _______ or more. Answer: $500
◉ What is required in order for the parties (the individuals entering
into the contract) to have "legal capacity?" Answer: The parties to
the contract must be of legal age under the laws of the state in which
the contract is written.
,◉ Criteria that can block the formation of a valid contract: Answer:
1. The need for a written agreement under the Statute of Frauds and
certain provisions of the Uniform Commercial Code (U.C.C.)
2. The need for legal capacity of a party to contract
3. The act of fraudulent inducement
◉ What is "consideration" as it applies to a contract? Answer: The
requirement that each party to the contract receives something of
value in exchange for what is given.
◉ Finance Charge Answer: The Finance Charge is the resulting
dollar amount calculated by applying the Annual Percentage Rate to
the Amount Financed over the term of the contract.
◉ How the Itemization of Amount Financed is completed Answer: 1.
Cash Price (Agreed to price of vehicle)
2. Total Downpayment
3. Unpaid Balance of Cash Price(Cash Price-Downpayment)
4. Other Charges (GAP, VSC, Etc.)
5. Amount Financed
◉ 4 Key Sections of an installment sale contract Answer: Section A)
General Information -- Identifies the parties to the agreement.
, Section B) Mandated Disclosures -- Disclosures required by TILA
Section C) Insurance-Related Disclosures --Credit insurance is
optional
Section D) Signature Blocks - Notice to Buyer Disclosures --Bind all
parties to contract
◉ The introductory information and promise to pay contained in
Section A of Retail Installment Form Answer: Promise to Pay - This
section outlines the purpose of the transaction and the primary
obligations that will be incurred from signing the contract.
◉ The difference between full or partial recourse and no recourse
assignments. Answer: Essentially determines the length of time, if
any, the seller is responsible for the actions of the buyer.
◉ Warranty disclaimers do not apply to _______ warranties on new or
used vehicles to which that warranty still applies. Answer:
Manufacturer's
◉ A(n) _______ clause allows the creditor to declare the entire
outstanding balance due and payable. Answer: Acceleration
COMPLETE STUDY GUIDE 2026
◉ (True/False): As an F&I manager working directly with
customers, you are individually responsible for your actions and
what you say to each customer. Answer: True
◉ In a typical credit transaction the (bank)/(dealer) is the creditor.
Answer: The dealer is the creditor
◉ What is a contract? Answer: A contract is an agreement involving
a promise or set of promises that the law enforces or protects.
◉ The formation of a contract requires three elements: Answer: 1.
Offer
2. Acceptance
3. Consideration
◉ An offer consists of three elements: Answer: 1. An expression of a
promise or commitment (intent) to enter a contract
2. An expression of definite and certain terms
3. The communication of the offer to the offeree (in this case, the
customer)
,◉ An offer may be terminated by: Answer: 1. An act of the parties
2. The operation of law
◉ There are three criteria for the acceptance of an offer: Answer: 1.
The offer is accepted by one who is entitled to accept
2. The acceptance takes the proper form and is timely
3. The terms of acceptance reflect closely the terms of the offer and,
therefore, do not amount to a counteroffer
◉ The Statute of Frauds Answer: Generally requires that all
contracts involving the sale of goods for a price of $500 or more be
in writing.
◉ The Statute of Frauds requires a written contract for the sale of
goods for a price of _______ or more. Answer: $500
◉ What is required in order for the parties (the individuals entering
into the contract) to have "legal capacity?" Answer: The parties to
the contract must be of legal age under the laws of the state in which
the contract is written.
,◉ Criteria that can block the formation of a valid contract: Answer:
1. The need for a written agreement under the Statute of Frauds and
certain provisions of the Uniform Commercial Code (U.C.C.)
2. The need for legal capacity of a party to contract
3. The act of fraudulent inducement
◉ What is "consideration" as it applies to a contract? Answer: The
requirement that each party to the contract receives something of
value in exchange for what is given.
◉ Finance Charge Answer: The Finance Charge is the resulting
dollar amount calculated by applying the Annual Percentage Rate to
the Amount Financed over the term of the contract.
◉ How the Itemization of Amount Financed is completed Answer: 1.
Cash Price (Agreed to price of vehicle)
2. Total Downpayment
3. Unpaid Balance of Cash Price(Cash Price-Downpayment)
4. Other Charges (GAP, VSC, Etc.)
5. Amount Financed
◉ 4 Key Sections of an installment sale contract Answer: Section A)
General Information -- Identifies the parties to the agreement.
, Section B) Mandated Disclosures -- Disclosures required by TILA
Section C) Insurance-Related Disclosures --Credit insurance is
optional
Section D) Signature Blocks - Notice to Buyer Disclosures --Bind all
parties to contract
◉ The introductory information and promise to pay contained in
Section A of Retail Installment Form Answer: Promise to Pay - This
section outlines the purpose of the transaction and the primary
obligations that will be incurred from signing the contract.
◉ The difference between full or partial recourse and no recourse
assignments. Answer: Essentially determines the length of time, if
any, the seller is responsible for the actions of the buyer.
◉ Warranty disclaimers do not apply to _______ warranties on new or
used vehicles to which that warranty still applies. Answer:
Manufacturer's
◉ A(n) _______ clause allows the creditor to declare the entire
outstanding balance due and payable. Answer: Acceleration
