AFIP CERTIFICATION EXAM SCRIPT
COMPLETE QUESTIONS AND
ANSWERS
⩥ (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
⩥ As recorded on an installment sale agreement, the total sale price or
deferred contract price would be the total of the ________. Answer: -
Payments
-Downpayment
-Net Trade-In
COMPLETE QUESTIONS AND
ANSWERS
⩥ (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
⩥ As recorded on an installment sale agreement, the total sale price or
deferred contract price would be the total of the ________. Answer: -
Payments
-Downpayment
-Net Trade-In
