CCP Legal & Regulatory Compliance in Credit Management 2

Question 1

Under the Fair Debt Collection Practices Act (FDCPA), which of the following communications is PROHIBITED when contacting a consumer about a debt?

Accepted Answer

Contacting the consumer at their place of employment when the employer prohibits such calls

Answer

The FDCPA prohibits debt collectors from contacting consumers at their workplace if the collector knows the employer prohibits such calls.

Question 2

A creditor files a UCC-1 financing statement to perfect a security interest. What is the primary purpose of this filing?

Accepted Answer

To provide public notice of the creditor's security interest to third parties

Answer

Filing a UCC-1 financing statement perfects a security interest by providing constructive notice to third parties, establishing priority over subsequent creditors.

Question 3

Which federal law requires creditors to provide applicants with a notice of adverse action when credit is denied?

Accepted Answer

Equal Credit Opportunity Act (ECOA)

Answer

The Equal Credit Opportunity Act (ECOA) requires creditors to notify applicants of adverse action taken on a credit application, including the reasons for denial.

Question 4

A business debtor files for Chapter 11 bankruptcy. What is the immediate effect on creditors' collection efforts?

Accepted Answer

An automatic stay immediately halts most collection activities against the debtor

Answer

Upon filing for Chapter 11 bankruptcy, an automatic stay immediately goes into effect, which prohibits most collection actions, lawsuits, and enforcement of liens against the debtor.

Question 5

Under the FCRA, how long may a Chapter 7 bankruptcy remain on a consumer's credit report?

Accepted Answer

10 years from the date of filing

Answer

Under the FCRA, a Chapter 7 bankruptcy may remain on a consumer's credit report for 10 years from the date of filing.

(CCP) Certified Credit Professional Practice Test

(CCP) Certified Credit Professional Practice Test

CCP Legal & Regulatory Compliance in Credit Management 2