CLFP(Certified Lease & Finance Professional) EXAM
- Leasing Law SOLVED EXAM QUESTIONS WITH
ANSWERS CORRECT AND CLEAR.
A transaction does not create a security interest merely because of what? - CORRECT
ANSWER✅✅1.) the present value of the consideration the lessee is obligated to pay
the lessor for the right of possession and use is substantially equal to or greater than
the FMV at the time the lease was entered
2.) the lessee assumes the risk of loss of the goods or agrees to pay taxes, insurance,
filings, maintenance etc related to the property
3.) the lessee has the option to renew or own
4.) The lessee has the option to renew for a fixed rent equal to or greater then the FMV
at the time of the option
5.) The lessee has an option to become the owner of the goods at a price >= FMV at
the time of the option
CLFP(Certified Lease & Finance Professional) EXAM - Leasing Law - CORRECT
ANSWER✅✅Exam Coverage
Exam coverage for the CLFP (Certified Lease & Finance Professional) Exam - Leasing
Law includes the legal principles, regulatory requirements, and contractual frameworks
governing equipment leasing and commercial finance transactions. It focuses on lease
classifications, contract formation, Uniform Commercial Code (UCC) provisions,
secured transactions, ownership rights, lessee and lessor obligations, and the legal
structure of lease and finance agreements. The exam also evaluates understanding of
documentation requirements, enforceability of contracts, default and remedies
provisions, risk allocation, and legal considerations affecting equipment finance
transactions.
Contrast True Lease/Secured Loan - Bankruptcy - CORRECT ANSWER✅✅Generally,
a lessor under a true lease has better rights to recover equipment in a bk.
Contrast True Lease/Secured Loan - Collateral - CORRECT ANSWER✅✅It is incorrect
to referred to leased equipment as collateral but it is appropriate for a secured loan.
Both require good maintenance of the equipment. Lease has return provisions
Contrast True Lease/Secured Loan - Filing/Title - CORRECT ANSWER✅✅It is not
required for a lessor to file a UCC for a true lease. Leases are not governed by UCC
Article 9 and there is not filing requirement under article 2A.
, Contrast True Lease/Secured Loan - Interest/Usury - CORRECT ANSWER✅✅Interest
is charged on a secured loan, but not on a lease. Therefore a true lease may avoid
usury laws. True lease has rent payments whereas a secured loan has interest/principal
payments.
Contrast True Lease/Secured Loan - Liability - CORRECT ANSWER✅✅Generally
speaking their is more exposure to the lessor on a true lease for liability
Contrast True Lease/Secured Loan - Residual - CORRECT ANSWER✅✅With respect
to vehicles, aircraft and other titled equipment true leases require the lessor to be
shown as the owner. Whereas secured loans require notation on certificate of title of the
lender's interest.
Contrast True Lease/Secured Loan - UCC Rights - CORRECT ANSWER✅✅UCC
distinguishes true lease and loans in several ways. True Lease = UCC 2A. Secured
Loan = UCC 9. In a lease, lessor owns equipment. In a loan, the lessee owns the
equipment and the lender has security interest
Describe the Bankruptcy Procedure. - CORRECT ANSWER✅✅1.) filing petition
(voluntary or involuntary)
2.) Automatic Stay - prohibit action against debtor other than through the court.
3.) If Chapter 11, prepare Plan of Reorganization which outlines repayment of debt.
4.) Assumption/Rejection of debt. Submitted prior to Plan of Reorganization, if accepted
must be paid by debtor per agreement. If rejected, lessor can recover equipment;
How are "reasonably predictable" and "useful economic life" determined? - CORRECT
ANSWER✅✅with reference to the facts and circumstances at the time the transaction
is entered.
How does Article 2A define Fiance Lease? - CORRECT ANSWER✅✅Refers to a lease
which is 1.) a true lease in which 2.) lessor is not the manufacturer or vendor of the
property. 3.) the lessor does not select the equipment or lease it from inventory 4.)
lessor makes sure lessee is apprised of its rights with the supplier
How is "residual position" used by courts to designate lease vs. loan? - CORRECT
ANSWER✅✅If the lease allows the lessee to purchase the asset for substantially less
than the FMV, the lease will be deemed a secured loan
What are a Lessee's disadvantages for failing to "qualifying to do business" in a state? -
CORRECT ANSWER✅✅1.) cannot obtain written confirmation for teh state that it has
legal right to transaction business in the state, has not dissolved or failed to pay taxes
2.) certain legal rights in a foreign foreign jurisdiction may be impaired
What are a Lessor's disadvantages for failing to "qualifying to do business" in a state? -
CORRECT ANSWER✅✅1.) potential penalty
- Leasing Law SOLVED EXAM QUESTIONS WITH
ANSWERS CORRECT AND CLEAR.
A transaction does not create a security interest merely because of what? - CORRECT
ANSWER✅✅1.) the present value of the consideration the lessee is obligated to pay
the lessor for the right of possession and use is substantially equal to or greater than
the FMV at the time the lease was entered
2.) the lessee assumes the risk of loss of the goods or agrees to pay taxes, insurance,
filings, maintenance etc related to the property
3.) the lessee has the option to renew or own
4.) The lessee has the option to renew for a fixed rent equal to or greater then the FMV
at the time of the option
5.) The lessee has an option to become the owner of the goods at a price >= FMV at
the time of the option
CLFP(Certified Lease & Finance Professional) EXAM - Leasing Law - CORRECT
ANSWER✅✅Exam Coverage
Exam coverage for the CLFP (Certified Lease & Finance Professional) Exam - Leasing
Law includes the legal principles, regulatory requirements, and contractual frameworks
governing equipment leasing and commercial finance transactions. It focuses on lease
classifications, contract formation, Uniform Commercial Code (UCC) provisions,
secured transactions, ownership rights, lessee and lessor obligations, and the legal
structure of lease and finance agreements. The exam also evaluates understanding of
documentation requirements, enforceability of contracts, default and remedies
provisions, risk allocation, and legal considerations affecting equipment finance
transactions.
Contrast True Lease/Secured Loan - Bankruptcy - CORRECT ANSWER✅✅Generally,
a lessor under a true lease has better rights to recover equipment in a bk.
Contrast True Lease/Secured Loan - Collateral - CORRECT ANSWER✅✅It is incorrect
to referred to leased equipment as collateral but it is appropriate for a secured loan.
Both require good maintenance of the equipment. Lease has return provisions
Contrast True Lease/Secured Loan - Filing/Title - CORRECT ANSWER✅✅It is not
required for a lessor to file a UCC for a true lease. Leases are not governed by UCC
Article 9 and there is not filing requirement under article 2A.
, Contrast True Lease/Secured Loan - Interest/Usury - CORRECT ANSWER✅✅Interest
is charged on a secured loan, but not on a lease. Therefore a true lease may avoid
usury laws. True lease has rent payments whereas a secured loan has interest/principal
payments.
Contrast True Lease/Secured Loan - Liability - CORRECT ANSWER✅✅Generally
speaking their is more exposure to the lessor on a true lease for liability
Contrast True Lease/Secured Loan - Residual - CORRECT ANSWER✅✅With respect
to vehicles, aircraft and other titled equipment true leases require the lessor to be
shown as the owner. Whereas secured loans require notation on certificate of title of the
lender's interest.
Contrast True Lease/Secured Loan - UCC Rights - CORRECT ANSWER✅✅UCC
distinguishes true lease and loans in several ways. True Lease = UCC 2A. Secured
Loan = UCC 9. In a lease, lessor owns equipment. In a loan, the lessee owns the
equipment and the lender has security interest
Describe the Bankruptcy Procedure. - CORRECT ANSWER✅✅1.) filing petition
(voluntary or involuntary)
2.) Automatic Stay - prohibit action against debtor other than through the court.
3.) If Chapter 11, prepare Plan of Reorganization which outlines repayment of debt.
4.) Assumption/Rejection of debt. Submitted prior to Plan of Reorganization, if accepted
must be paid by debtor per agreement. If rejected, lessor can recover equipment;
How are "reasonably predictable" and "useful economic life" determined? - CORRECT
ANSWER✅✅with reference to the facts and circumstances at the time the transaction
is entered.
How does Article 2A define Fiance Lease? - CORRECT ANSWER✅✅Refers to a lease
which is 1.) a true lease in which 2.) lessor is not the manufacturer or vendor of the
property. 3.) the lessor does not select the equipment or lease it from inventory 4.)
lessor makes sure lessee is apprised of its rights with the supplier
How is "residual position" used by courts to designate lease vs. loan? - CORRECT
ANSWER✅✅If the lease allows the lessee to purchase the asset for substantially less
than the FMV, the lease will be deemed a secured loan
What are a Lessee's disadvantages for failing to "qualifying to do business" in a state? -
CORRECT ANSWER✅✅1.) cannot obtain written confirmation for teh state that it has
legal right to transaction business in the state, has not dissolved or failed to pay taxes
2.) certain legal rights in a foreign foreign jurisdiction may be impaired
What are a Lessor's disadvantages for failing to "qualifying to do business" in a state? -
CORRECT ANSWER✅✅1.) potential penalty
