CAR SALES TEST COLORADO STATE
EXAM QUESTIONS AND ANSWERS
(COLORADO MOTOR VEHICLE DEALER
AND SALESPERSON LICENSING LAW)
2024-2025 NEW UPDATE
The License of a motor vehicle salesperson or a power sports salesperson may
be denied revoked, or suspended on any of the following grounds except:
Advertising a salvage vehicle while identifying the vehicle as a salvage vehicle
The advertise price of a motor vehicle must include:
Answer- Finance Charge
Advertisement of rate of finance charge. If an advertisement states a rate of finance
charge, it
shall state the rate as an "annual percentage rate," using that term. If the annual
percentage
rate may be increased after consummation, the advertisement shall state that fact. If an
advertisement is for credit not secured by a dwelling, the advertisement shall not state
any
other rate, except that a simple annual rate or periodic rate that is applied to an unpaid
balance
may be stated in conjunction with, but not more conspicuously than, the annual
percentage
rate. If an advertisement is for credit secured by a dwelling, the advertisement shall not
state any other rate, except that a simple annual rate that is applied to an unpaid
balance may
be stated in conjunction with, but not more conspicuously than, the annual percentage
rate.
Advertisement of terms that require additional disclosures -
,Triggering terms. If any of the following terms is set forth in an advertisement, the
advertisement shall meet the requirements of paragraph (d)(2) of this section:
(i)
The amount or percentage of any downpayment.
(ii)
The number of payments or period of repayment.
(iii)
The amount of any payment.
(iv)
The amount of any finance charge.
Which of the following is a true statement regarding dealers and buyers
a dealer shall clearly indicate on the customer contract when a vehicle is sold "as-is and
without a garantee
Which of the following is not proof of ownership of a motor vehicle for a Colorado
dealer
Answer- A vehicle subject to lien on the title
2.0 Proof of Ownership Requirements
a. A used vehicle with a Colorado title:
2.1 All Colorado dealers or wholesalers must maintain the following evidence of
ownership for each
vehicle in their possession:
61
Auto Industry DivisionStudy Guide- Miscellaneous Statutes & Regulations
2. Odometer disclosure if required.
A used vehicle with an out-of-state title:
Odometer disclosure if required; and,
Colorado Dealer's Out-of-State Vehicle Information Disclosure; and,
Colorado verification of Vehicle Identification Number.
A new vehicle assigned by MCO to a dealer or wholesaler:
MCO assigned or reassigned to a franchised dealer or wholesaler; and,
,Odometer disclosure if required.
MCO reassigned to the franchised dealer or wholesaler; and,
Odometer disclosure if required; and,
Verification of vehicle identification number.
1. A Colorado title assigned to the dealer, wholesaler, or chain of ownership
evidenced by the Colorado Dealer's Bill(s) of Sale for a Motor Vehicle; and,
1. The out-of-state title assigned to the dealer, wholesaler, or out-of-state title
with proper chain of ownership; and,
3. No dealer or wholesaler shall hold a MCO unless that dealer or wholesaler is
franchised to sell that specific make of vehicle as indicated on the MCO.
d. A new vehicle assigned or re-assigned with its MCO from an out-of-state franchised
dealer or wholesaler to a franchised Colorado dealer or wholesaler:
4. No dealer or wholesaler shall hold a MCO unless that dealer or wholesaler is
franchised to sell that specific make of vehicle as indicated on the MCO.
e. If a title or an MCO has been surrendered by the dealer or wholesaler to a bank or
financing organization or any other person as collateral under a Floor Plan agreement,
the dealer or wholesaler must have in its possession evidence acceptable to the
Department of the location of the title or the MCO. The dealer's or wholesaler's right to
ownership shall be clear from such evidence. The title or MCO must be procured by the
dealer or wholesaler upon the sale and delivery of the vehicle and delivered or mailed to
the purchaser or chattel mortgage company within thirty (30) days pursuant to 42-6-
112, C.R.S.
f. Vehicles with incomplete or insufficient titles shall be marked "Not for Sale" and
withheld from any public offering.
Satisfactory Evidence of Vehicle Ownership 2.1 The Department may accept the
following documents as evidence of vehicle ownership: a. A certificate of title issued by
the State of Colorado or a Foreign Jurisdiction transferred as provided in section 42-6-
110, C.R.S.; b. A Current Registration for the vehicle listing the applicant's name if
issued by a Foreign Jurisdiction that does not issue a title for that vehicle type; c. A bill
of sale for a vehicle not previously required to be titled or registered in the State of
, Colorado; d. A bill of sale for a vehicle from a Foreign Jurisdiction if the Department
verifies that the jurisdiction does not issue a title for or register that vehicle type; e. A
Current Registration issued by the U.S. Armed Services; f. A copy of a court order
describing the vehicle by year, make, and Vehicle Identification Number (VIN), and
directing the Department to issue a Colorado certificate of title to the applicant, or a
judgment for possession obtained through a civil proceeding pursuant to section 42-6-
114, C.R.S.; g. A completed DR 2409 Statement of Assembly of Homemade Trailer and
Assignment of Trailer I.D. Number if the trailer is a homemade vehicle as defined in
section 42-5- 201(4), C.R.S.; or h. Other evidence deemed by the Department to be
satisfactory evidence of vehicle ownership. 2.2 If an applicant does not have the
Colorado certificate of title and the Colorado record has been purged, any of the
following documents listing the applicant's name, submitted together with a completed
DR 2116 Motor Vehicle Bill of Sale For a Purged Colorado Record, may be considered
satisfactory evidence of proof of vehicle ownership: a. Colorado registration; b.
Colorado registration renewal card; c. Photocopy of the Colorado certificate of title; d. A
certified copy of the Colorado motor vehicle record; or e. Other documentation deemed
by the Department to be satisfactory evidence of vehicle ownership. 2.3 Any document
provided as evidence of vehicle ownership must include the VIN, vehicle year, vehicle
make, and the applicant's name listed as the owner, buyer, or transferee. 2.4 The
Department will not accept documents that do not contain all elements required to prove
authenticity (e.g., certification, notary, acceptable transfers, assignments, etc...). 66
Auto Industry Division Study Guide- Miscellaneous Statutes & Regulations 2.5 An
applicant who cannot provide satisfactory proof of vehicle ownership documents must
satisfy all requirements set forth in section 42-6-115, C.R.S., and 1 CCR 204-10. Rule
19. Bonding for Colorado Certificate of Title.
A buyers agent may:
Right answer- retained or hired by a consumer for a fee or other thing of value to assist,
represent, or
act on behalf of the consumer in connection with the purchase or lease of a motor
vehicle / powersport vehicle.
EXAM QUESTIONS AND ANSWERS
(COLORADO MOTOR VEHICLE DEALER
AND SALESPERSON LICENSING LAW)
2024-2025 NEW UPDATE
The License of a motor vehicle salesperson or a power sports salesperson may
be denied revoked, or suspended on any of the following grounds except:
Advertising a salvage vehicle while identifying the vehicle as a salvage vehicle
The advertise price of a motor vehicle must include:
Answer- Finance Charge
Advertisement of rate of finance charge. If an advertisement states a rate of finance
charge, it
shall state the rate as an "annual percentage rate," using that term. If the annual
percentage
rate may be increased after consummation, the advertisement shall state that fact. If an
advertisement is for credit not secured by a dwelling, the advertisement shall not state
any
other rate, except that a simple annual rate or periodic rate that is applied to an unpaid
balance
may be stated in conjunction with, but not more conspicuously than, the annual
percentage
rate. If an advertisement is for credit secured by a dwelling, the advertisement shall not
state any other rate, except that a simple annual rate that is applied to an unpaid
balance may
be stated in conjunction with, but not more conspicuously than, the annual percentage
rate.
Advertisement of terms that require additional disclosures -
,Triggering terms. If any of the following terms is set forth in an advertisement, the
advertisement shall meet the requirements of paragraph (d)(2) of this section:
(i)
The amount or percentage of any downpayment.
(ii)
The number of payments or period of repayment.
(iii)
The amount of any payment.
(iv)
The amount of any finance charge.
Which of the following is a true statement regarding dealers and buyers
a dealer shall clearly indicate on the customer contract when a vehicle is sold "as-is and
without a garantee
Which of the following is not proof of ownership of a motor vehicle for a Colorado
dealer
Answer- A vehicle subject to lien on the title
2.0 Proof of Ownership Requirements
a. A used vehicle with a Colorado title:
2.1 All Colorado dealers or wholesalers must maintain the following evidence of
ownership for each
vehicle in their possession:
61
Auto Industry DivisionStudy Guide- Miscellaneous Statutes & Regulations
2. Odometer disclosure if required.
A used vehicle with an out-of-state title:
Odometer disclosure if required; and,
Colorado Dealer's Out-of-State Vehicle Information Disclosure; and,
Colorado verification of Vehicle Identification Number.
A new vehicle assigned by MCO to a dealer or wholesaler:
MCO assigned or reassigned to a franchised dealer or wholesaler; and,
,Odometer disclosure if required.
MCO reassigned to the franchised dealer or wholesaler; and,
Odometer disclosure if required; and,
Verification of vehicle identification number.
1. A Colorado title assigned to the dealer, wholesaler, or chain of ownership
evidenced by the Colorado Dealer's Bill(s) of Sale for a Motor Vehicle; and,
1. The out-of-state title assigned to the dealer, wholesaler, or out-of-state title
with proper chain of ownership; and,
3. No dealer or wholesaler shall hold a MCO unless that dealer or wholesaler is
franchised to sell that specific make of vehicle as indicated on the MCO.
d. A new vehicle assigned or re-assigned with its MCO from an out-of-state franchised
dealer or wholesaler to a franchised Colorado dealer or wholesaler:
4. No dealer or wholesaler shall hold a MCO unless that dealer or wholesaler is
franchised to sell that specific make of vehicle as indicated on the MCO.
e. If a title or an MCO has been surrendered by the dealer or wholesaler to a bank or
financing organization or any other person as collateral under a Floor Plan agreement,
the dealer or wholesaler must have in its possession evidence acceptable to the
Department of the location of the title or the MCO. The dealer's or wholesaler's right to
ownership shall be clear from such evidence. The title or MCO must be procured by the
dealer or wholesaler upon the sale and delivery of the vehicle and delivered or mailed to
the purchaser or chattel mortgage company within thirty (30) days pursuant to 42-6-
112, C.R.S.
f. Vehicles with incomplete or insufficient titles shall be marked "Not for Sale" and
withheld from any public offering.
Satisfactory Evidence of Vehicle Ownership 2.1 The Department may accept the
following documents as evidence of vehicle ownership: a. A certificate of title issued by
the State of Colorado or a Foreign Jurisdiction transferred as provided in section 42-6-
110, C.R.S.; b. A Current Registration for the vehicle listing the applicant's name if
issued by a Foreign Jurisdiction that does not issue a title for that vehicle type; c. A bill
of sale for a vehicle not previously required to be titled or registered in the State of
, Colorado; d. A bill of sale for a vehicle from a Foreign Jurisdiction if the Department
verifies that the jurisdiction does not issue a title for or register that vehicle type; e. A
Current Registration issued by the U.S. Armed Services; f. A copy of a court order
describing the vehicle by year, make, and Vehicle Identification Number (VIN), and
directing the Department to issue a Colorado certificate of title to the applicant, or a
judgment for possession obtained through a civil proceeding pursuant to section 42-6-
114, C.R.S.; g. A completed DR 2409 Statement of Assembly of Homemade Trailer and
Assignment of Trailer I.D. Number if the trailer is a homemade vehicle as defined in
section 42-5- 201(4), C.R.S.; or h. Other evidence deemed by the Department to be
satisfactory evidence of vehicle ownership. 2.2 If an applicant does not have the
Colorado certificate of title and the Colorado record has been purged, any of the
following documents listing the applicant's name, submitted together with a completed
DR 2116 Motor Vehicle Bill of Sale For a Purged Colorado Record, may be considered
satisfactory evidence of proof of vehicle ownership: a. Colorado registration; b.
Colorado registration renewal card; c. Photocopy of the Colorado certificate of title; d. A
certified copy of the Colorado motor vehicle record; or e. Other documentation deemed
by the Department to be satisfactory evidence of vehicle ownership. 2.3 Any document
provided as evidence of vehicle ownership must include the VIN, vehicle year, vehicle
make, and the applicant's name listed as the owner, buyer, or transferee. 2.4 The
Department will not accept documents that do not contain all elements required to prove
authenticity (e.g., certification, notary, acceptable transfers, assignments, etc...). 66
Auto Industry Division Study Guide- Miscellaneous Statutes & Regulations 2.5 An
applicant who cannot provide satisfactory proof of vehicle ownership documents must
satisfy all requirements set forth in section 42-6-115, C.R.S., and 1 CCR 204-10. Rule
19. Bonding for Colorado Certificate of Title.
A buyers agent may:
Right answer- retained or hired by a consumer for a fee or other thing of value to assist,
represent, or
act on behalf of the consumer in connection with the purchase or lease of a motor
vehicle / powersport vehicle.
