CARS Asset Recovery Specialist Legal Compliance 3

Question 1

After a vehicle is repossessed, the lender sells it at auction for less than the outstanding loan balance. The remaining amount owed by the borrower is called:

Accepted Answer

Deficiency balance

Answer

The deficiency balance is the difference between what the vehicle sold for and the total amount owed, which the borrower may still legally owe.

Question 2

Under the FDCPA, which of the following constitutes an example of a prohibited 'deceptive' collection practice?

Accepted Answer

Falsely implying a collector is an attorney to pressure payment

Answer

Falsely representing that a collector is an attorney is explicitly prohibited as a deceptive practice under Section 807 of the FDCPA.

Question 3

Which agency has primary enforcement authority over the FDCPA for most third-party debt collectors?

Accepted Answer

Consumer Financial Protection Bureau (CFPB)

Answer

The CFPB has primary supervisory and enforcement authority over most third-party debt collectors under the FDCPA.

Question 4

A debtor notifies a collector that they are represented by an attorney. Under the FDCPA, the collector must:

Accepted Answer

Cease all contact with the debtor and communicate only with the attorney

Answer

Once a collector knows the debtor is represented by an attorney, all further communications must go through that attorney.

Question 5

The FDCPA debt validation notice must be sent to the debtor within how many days of the initial communication?

Accepted Answer

5 days

Answer

Section 809 of the FDCPA requires that collectors send a written validation notice within five days of the initial communication if it was not provided in that communication.

(CARS) Certified Asset Recovery Specialist Practice Test

(CARS) Certified Asset Recovery Specialist Practice Test

CARS Asset Recovery Specialist Legal Compliance 3