Exam 26: The Legal Aspects of Credit

Brooker Boat Inc.plans to sell 10 boats to a Holiday Boat Sales Ltd.What is the name of the written promise by Holiday's bank to Brooker to pay Brooker when certain specified conditions are met?

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(Multiple Choice)

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Question 1

Correct Answer:

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Briefly explain what an acceleration clause is,what it does,and the incentive it provides.

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Question 2

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Credit agreements normally permit the lender to call the entire loan based on default of one payment,through what is known as an acceleration clause.The default accelerates the time when the entire debt is due to the date of the default,thereby giving the debtor an incentive to make timely payments.

Which of the following would typically be requested by a lender being asked to grant a large commercial operating line of credit?

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Question 3

Correct Answer:

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Which of the following represents a valid criticism of payday loans?

(Multiple Choice)

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Question 4

Identify the source of prevention of hidden charges by a lender that also enables a borrower to appreciate the cost of a loan transaction,and briefly discuss what is required to achieve these outcomes.

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Question 5

Which of the following represents a restriction on collection agencies when attempting to collect a debt?

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Question 6

Briefly explain what a letter of credit is and discuss the requirements that this type of financing arrangement involves.

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Question 7

Consumer protection laws relating to lending institutions are scattered throughout a number of pieces of legislation.What is the unifying theme that each seeks to regulate?

(Multiple Choice)

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Question 8

When a lender has appointed a receiver,its primary objective is redeeming sufficient assets to clear a loan.To which of the following is the ability of the receiver to control the business to the exclusion of the debtor directly related?

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Question 9

Credit bureaus provide a service to consumers by compiling personal credit history information created by an individual's lenders and then making the information available to that individual.

(True/False)

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Question 10

A deficiency results when a creditor has been forced to sell assets because of borrower default and the price realized by the sale is less than the outstanding amount of the debt.

(True/False)

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Question 11

A letter of commitment contains the actual loan agreement between the lender and the commercial borrower; the borrower,lacking bargaining power,must meet those terms if it wants the loan.

(True/False)

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Question 12

Outline the typical terms contained in a guarantee agreement.

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Question 13

Which of the following companies would risk the revocation of its licence for failing to provide accurate information?

(Multiple Choice)

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Question 14

The process of recording a security interest in a personal property security registry is known as registration.

(True/False)

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Question 15

The amount of security derived from a business's inventory and accounts receivable pledged in a general security agreement is the value of those assets at any given time.

(True/False)

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Question 16

Creditors often include terms in credit agreements that require debtors to carry on business in accordance with specific requirements.

(True/False)

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Question 17

What role does legislation play with respect to enabling a creditor to begin legal action for arrears,retain or take possession of collateral,and appoint a receiver or manager?

(Multiple Choice)

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Question 18

A financing statement is required to be registered each time a borrower has acquired assets after giving a general security agreement over the borrower's current assets.

(True/False)

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Question 19

How does the PPSA resolve conflicts when more than one debtor claims a security interest in the same collateral of the debtor?

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Question 20

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Exam 26: The Legal Aspects of Credit

Brooker Boat Inc.plans to sell 10 boats to a Holiday Boat Sales Ltd.What is the name of the written promise by Holiday's bank to Brooker to pay Brooker when certain specified conditions are met?

Briefly explain what an acceleration clause is,what it does,and the incentive it provides.

Which of the following would typically be requested by a lender being asked to grant a large commercial operating line of credit?

Which of the following represents a valid criticism of payday loans?

Identify the source of prevention of hidden charges by a lender that also enables a borrower to appreciate the cost of a loan transaction,and briefly discuss what is required to achieve these outcomes.

Which of the following represents a restriction on collection agencies when attempting to collect a debt?

Briefly explain what a letter of credit is and discuss the requirements that this type of financing arrangement involves.

Consumer protection laws relating to lending institutions are scattered throughout a number of pieces of legislation.What is the unifying theme that each seeks to regulate?

When a lender has appointed a receiver,its primary objective is redeeming sufficient assets to clear a loan.To which of the following is the ability of the receiver to control the business to the exclusion of the debtor directly related?

Credit bureaus provide a service to consumers by compiling personal credit history information created by an individual's lenders and then making the information available to that individual.

A deficiency results when a creditor has been forced to sell assets because of borrower default and the price realized by the sale is less than the outstanding amount of the debt.

A letter of commitment contains the actual loan agreement between the lender and the commercial borrower; the borrower,lacking bargaining power,must meet those terms if it wants the loan.

Outline the typical terms contained in a guarantee agreement.

Which of the following companies would risk the revocation of its licence for failing to provide accurate information?

The process of recording a security interest in a personal property security registry is known as registration.

The amount of security derived from a business's inventory and accounts receivable pledged in a general security agreement is the value of those assets at any given time.

Creditors often include terms in credit agreements that require debtors to carry on business in accordance with specific requirements.

What role does legislation play with respect to enabling a creditor to begin legal action for arrears,retain or take possession of collateral,and appoint a receiver or manager?

A financing statement is required to be registered each time a borrower has acquired assets after giving a general security agreement over the borrower's current assets.

How does the PPSA resolve conflicts when more than one debtor claims a security interest in the same collateral of the debtor?

Knowledge of Law As a Business Asset

The Canadian Legal System

Managing Legal Risks

Dispute Resolution

An Introduction to Contracts

Forming Contractual Relationships

The Terms of a Contract

Non-Enforcement of Contracts

Termination and Enforcement of Contracts

Introduction to Tort Law

The Tort of Negligence

Other Torts

The Agency Relationship

Business Forms and Arrangements

The Corporate Form: Organizational Matters

The Corporate Form: Operational Matters

Introduction to Property Law

Intellectual Property

Real Property

The Employment Relationship

Terminating the Employment Relationship

Professional Services

The Sale of Goods

Consumer Protection and Competition Law

Business and Banking

Bankruptcy and Insolvency

Insurance

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