2025/2026 AFIP CERTIFICATION EXAM WITH Q&A 100% VERIFIED ANSWER

2025/2026 AFIP CERTIFICATION EXAM WITH Q&A 100% VERIFIED ANSWER The ________ issues UDAP violations to dealers, the ________ issues UDAAP violations to dealers. CPFB, FTC 3 multiple choice options (True/False) If circumstances require that a second lease agreement be executed - the customer must be recontracted - the date recorded on the second agreement must be the date of the original contract. False 1 multiple choice option Which of the following events, if any, can terminate an offer? A. Death or insanity of an offeree or offeror 3 multiple choice options What is "consideration" as it applies to a contract? A. The requirement that each party to the contract receives something of value in exchange for what is given 3 multiple choice options If a customer is re-contracted five days after the original agreement was executed, how should the second agreement be treated? B. As an entirely new agreement, with the date the second contract is executed recorded on the installment sale agreement. 1 multiple choice option (True/False) TILA/Reg Z treats "loans" and "credit sales" the same way since they are both essentially a promise to pay. False 1 multiple choice option Although not specifically required by the TILA or Reg Z., an installment sale contract may contain an acceleration clause. This is a contract provision that allows the funding source who accepted the 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 1 multiple choice option The CFPB issues UDAAP violations. UDAAP stands for: C. Unfair, Deceptive, Abusive, Acts or Practices 2 multiple choice options A contract can be defined as an agreement that includes: C. A promise or set of promises that the law enforces or protects 3 multiple choice options Which of the following is considered a "credit sale" transaction under TILA/Reg Z? B. Karl arranges funding through the F&I manager for a vehicle purchased at a dealership. 1 multiple choice option What is an acceleration clause? B. If the customer defaults under the contract, the lender can make the full outstanding balance due and payable 2 multiple choice options An installment sale contract may contain a provision that allows the lender to _______ property insurance if the customer fails to obtain insurance or lets it lapse. A. force place 2 multiple choice options What do the letters in UDAP stand for? E. Unfair, Deceptive, Acts, Practices 3 multiple choice options What are the three required elements of a contract? D. An offer, acceptance, and consideration. 3 multiple choice options What are the criteria for "acceptance" of an offer? D. All of the above 3 multiple choice options The __________ issues UDAP violations to dealers, the __________ issues UDAAP violations to dealers. A. CFPB, FTC 3 multiple choice options (True/False) The dealer is the creditor in a typical credit transaction. True 1 multiple choice option As noted in the Truth in Lending Act and Reg. Z, if the customer owes more on the trade-in than the used car manager allowed, should the F&I manager do? D. None of the above 3 multiple choice options Which of the following transactions are NOT regulation by TILA/Reg Z? D. Both A and C 3 multiple choice options (True/False) With the exception of some Precomputed Interest contracts used by secondary finance sources, all other installment sales contracts are simple interest or interest-bearing contracts. The following is a layman's explanation of a simple interest installment sale transaction. In a precomputed contract the finance charge is computed on the assumption the contract will run full term. If the customer terminates the agreement during the repayment term, he will receive a refund of the unearned premium. In a simple interest- or interest-bearing installment sale agreement, the finance charge is computed daily and paid monthly throughout the term of the agreement. If the customer pays-off the vehicle before the scheduled end of the contract there is unearned finance charge money to refund, but it has been each month the contract has been in force. There is no refund of the unearned finance charge. True 1 multiple choice option Which of the following regulations implements the Truth in Lending Act? D. Regulation Z 3 multiple choice options (True/False) The Truth in Lending Act (TILA) is implemented by Regulation Z True 1 multiple choice option 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: B. That's the "cost of credit" as a yearly rate 3 multiple choice options (True/False) State law can require additional disclosures beyond those mandated by the TILA, Reg. Z True 1 multiple choice option (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 False. D. The cost of an oil change is not included. 1 multiple choice option (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 True 1 multiple choice option At the point in the financing process where the retail installment sale agreement is to be disclosed to the customer, at that point in time the parties to the contract are the customer and the _________. B. Selling dealer 3 multiple choice options As recorded on an installment sale agreement the total price or deferred contract price would be the total of the _______. D. All of the above 3 multiple choice options (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 discourse on an installment sale contract, the term "APR" or "annual percentage rate" should be used. True 1 multiple choice option What is the maximum criminal liability for willful and knowing violation of TILA Reg Z and or CLA Reg M? D. $5,000 fine, 1 year imprisonment, combination of both 3 multiple choice options (True/False) According to Regulation Z, down payment and total sale price must be disclosed. True 1 multiple choice option (True/False) Any communication to a single individual - verbally or in writi