Safety and Compliance Flashcards

Under the FTC Holder Rule, what must a consumer credit contract for a financed vehicle preserve?

Answer: The consumer's claims and defenses against the seller, assertable against the holder

The Holder Rule (16 CFR 433) requires a notice letting buyers assert seller-related claims and defenses against any holder of the contract.

Under Regulation B, how soon after receiving a completed credit application must a creditor generally notify the applicant of adverse action?

Answer: 30 days

Regulation B requires notice of action taken within 30 days after receiving a completed application.

A dealer receives $12,000 in cash from a buyer in two payments made within a week. What federal filing is required?

Answer: IRS Form 8300

Businesses receiving more than $10,000 in cash in one or related transactions must file Form 8300 within 15 days.

Which disclosure is NOT one of the core Truth in Lending 'federal box' items on a retail installment contract?

Answer: Vehicle trade-in appraisal value

The TILA box includes APR, finance charge, amount financed and total of payments, not trade-in appraisal value.

Under the Servicemembers Civil Relief Act, what interest rate cap applies to obligations incurred before active duty?

Answer: 6%

The SCRA caps interest on pre-service obligations at 6% per year during military service, upon request.

Which practice most likely violates the prohibition on breach of the peace during self-help repossession?

Answer: Continuing a repossession after the borrower objects in person

Proceeding over the debtor's in-person objection is a classic breach of the peace under UCC 9-609.

Before funding, a finance company screens customer names against a federal government list. Which list is this most likely?

Answer: The OFAC Specially Designated Nationals list

Financial institutions must avoid dealings with persons on the Treasury OFAC SDN list.