Practice Test Geeks(CARS) Certified Asset Recovery Specialist Practice Test
← All CARS Flashcard Decks

Foundational Concepts & Principles Flashcards

7 cards from real CARS practice questions. Tap to flip, then mark Knew It or Still Learning — missed cards come back until you master them.

Read the first 7 Foundational Concepts & Principles flashcards as text

  1. When a debtor files for Chapter 7 bankruptcy, the automatic stay generally:

    Answer: Immediately halts all repossession and collection activity against the debtor

    Filing for bankruptcy triggers an automatic stay under 11 U.S.C. § 362 that immediately stops all collection actions, including repossession.

  2. A 'charge-off' by a lender means the lender has:

    Answer: Written the debt off as a loss for accounting purposes while retaining the right to collect

    A charge-off is an accounting action where the lender writes off the loan as a loss, but the debt and security interest remain legally enforceable.

  3. The 'right of rescission' under the Truth in Lending Act (TILA) allows a borrower to cancel a loan secured by their primary residence within:

    Answer: 3 business days of consummation

    TILA provides a 3-business-day right of rescission for non-purchase money loans secured by a borrower's primary residence.

  4. In repossession law, 'curtilage' is significant because entering it without permission may:

    Answer: Constitute trespass and create liability for the repossession agent

    Curtilage is the enclosed area immediately surrounding a residence, and unauthorized entry can constitute trespass, exposing the agent to civil and criminal liability.

  5. Which of the following best describes the role of the Consumer Financial Protection Bureau (CFPB) in asset recovery?

    Answer: It enforces federal consumer financial protection laws that apply to creditors and servicers

    The CFPB supervises and enforces federal consumer financial laws for lenders, servicers, and related entities involved in asset recovery.

  6. A secured creditor who fails to provide the required pre-sale notice to a debtor risks:

    Answer: Loss of the right to collect a deficiency balance in many states

    In most states, failure to provide commercially reasonable notice before selling collateral bars the creditor from recovering any deficiency balance.

  7. An 'involuntary repossession' differs from a 'voluntary surrender' in that involuntary repossession:

    Answer: Occurs without the debtor's consent and is initiated solely by the creditor

    An involuntary repossession is conducted by the creditor or agent without debtor consent, as opposed to voluntary surrender where the debtor returns the collateral willingly.