AFIP STUDY EXAM ACTUAL QUESTIONS AND ANSWERS
WITH COMPLETE SOLUTIONS VERIFIED
Although not specifically required by Truth in Lending Act or Reg. Z, an
installment sale contract may contain an acceleration clause. This is a contract
provision that allows the finance source who accepted assignment of the
installment sale agreement to require the customer to pay all or part of the
outstanding balance if certain requirements are not met.
TRUE
What are the three required elements of a contract?
An offer, acceptance and consideration
The CFPB issues UDAAP violations. UDAAP stands for?
Unfair, Deceptive, Abusive, Acts or Practices
What are the criteria for "acceptance" of an offer?
ALL OF THE ABOVE
An installment sale contract may contain a provision that allows the lender to
_______ the insurance if the customer fails to obtain insurance or lets it lapse.
force place
The __________ issues UDAP violations to dealers, the __________ issues
UDAAP violations to dealers.
FTC, CFPB
What is an acceleration clause?
,If the customer defaults under the contract, the lender can make the full outstanding
balance due and payable
TILA/Reg Z treat "loans" and "credit sales" the same way since they are both
essentially a promise to pay.
FALSE
What is "consideration" as it applies to a contract?
The requirement that each party to the contract receives something of value in
exchange for what is given
What do the letters in UDAP stand for?
Unfair, Deceptive, Acts, Practices
Which of the following is considered a "credit sale" transaction under Truth in
Lending Act/Reg Z?
Karl arranges funding through the F&I manager for a vehicle purchased at a dealership.
Which Act does Regulation M implement?
Consumer Leasing Act (Consumer Leasing Act)
According to Regulation M, the APR must be disclosed?
FALSE
Which of the following is / are the advertisement triggering term(s) for a lease ad?
ALL OF THE ABOVE
A. A statement that any capitalized cost reduction or none at all is due prior to or at
consummation or delivery
, B. That no payment is required
C. The amount of any payment
Which of the following disclosures are required by the Consumer Leasing
Act/Reg. M to be on a lease agreement?
ALL OF THE ABOVE
A. Detailed information regarding the lessee's responsibility for maintaining and
servicing the vehicle and the excess wear-and-tear standards and obligations
B. Whether the customer has the option of purchasing the vehicle at the end of the
lease, and if so, its price
C. Early termination procedures and responsibilities
D. The lessee's requirement to provide insurance as required by the lessor
Which Act does Regulation M implement?
Consumer Leasing Act
If a lessee is not responsible at the end of the lease for the difference between the
residual value of the vehicle and its actual cash value or realized value, this
individual entered into a(n) _______ lease.
CLOSE-END
Consumer Leasing Act and Reg. M governs consumer lease transactions.
Consumer transactions are those in which the vehicles will be used primarily (51
percent of the time) for _______ purposes.
All of the above except D
WITH COMPLETE SOLUTIONS VERIFIED
Although not specifically required by Truth in Lending Act or Reg. Z, an
installment sale contract may contain an acceleration clause. This is a contract
provision that allows the finance source who accepted assignment of the
installment sale agreement to require the customer to pay all or part of the
outstanding balance if certain requirements are not met.
TRUE
What are the three required elements of a contract?
An offer, acceptance and consideration
The CFPB issues UDAAP violations. UDAAP stands for?
Unfair, Deceptive, Abusive, Acts or Practices
What are the criteria for "acceptance" of an offer?
ALL OF THE ABOVE
An installment sale contract may contain a provision that allows the lender to
_______ the insurance if the customer fails to obtain insurance or lets it lapse.
force place
The __________ issues UDAP violations to dealers, the __________ issues
UDAAP violations to dealers.
FTC, CFPB
What is an acceleration clause?
,If the customer defaults under the contract, the lender can make the full outstanding
balance due and payable
TILA/Reg Z treat "loans" and "credit sales" the same way since they are both
essentially a promise to pay.
FALSE
What is "consideration" as it applies to a contract?
The requirement that each party to the contract receives something of value in
exchange for what is given
What do the letters in UDAP stand for?
Unfair, Deceptive, Acts, Practices
Which of the following is considered a "credit sale" transaction under Truth in
Lending Act/Reg Z?
Karl arranges funding through the F&I manager for a vehicle purchased at a dealership.
Which Act does Regulation M implement?
Consumer Leasing Act (Consumer Leasing Act)
According to Regulation M, the APR must be disclosed?
FALSE
Which of the following is / are the advertisement triggering term(s) for a lease ad?
ALL OF THE ABOVE
A. A statement that any capitalized cost reduction or none at all is due prior to or at
consummation or delivery
, B. That no payment is required
C. The amount of any payment
Which of the following disclosures are required by the Consumer Leasing
Act/Reg. M to be on a lease agreement?
ALL OF THE ABOVE
A. Detailed information regarding the lessee's responsibility for maintaining and
servicing the vehicle and the excess wear-and-tear standards and obligations
B. Whether the customer has the option of purchasing the vehicle at the end of the
lease, and if so, its price
C. Early termination procedures and responsibilities
D. The lessee's requirement to provide insurance as required by the lessor
Which Act does Regulation M implement?
Consumer Leasing Act
If a lessee is not responsible at the end of the lease for the difference between the
residual value of the vehicle and its actual cash value or realized value, this
individual entered into a(n) _______ lease.
CLOSE-END
Consumer Leasing Act and Reg. M governs consumer lease transactions.
Consumer transactions are those in which the vehicles will be used primarily (51
percent of the time) for _______ purposes.
All of the above except D
