Surety Agreements - CPA Regulation (REG)
Card 1 of 24
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Tap to reveal answer
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
← Didn't Know|Knew It →
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Tap to reveal answer
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
← Didn't Know|Knew It →
Which of the following events will release a noncompensated surety from liability?
Which of the following events will release a noncompensated surety from liability?
Tap to reveal answer
A non-compensated (or gratuitous) surety is bound to the contract if he or she makes a promise to act as a surety prior to consideration changing hands from the creditor to the debtor. A gratuitous surety is released from liability only in a change of the original contract.
A non-compensated (or gratuitous) surety is bound to the contract if he or she makes a promise to act as a surety prior to consideration changing hands from the creditor to the debtor. A gratuitous surety is released from liability only in a change of the original contract.
← Didn't Know|Knew It →
Per the Federal Fair Debt Collection Practices Act, which of the following would a collection service using improper debt collection practices be subject to?
Per the Federal Fair Debt Collection Practices Act, which of the following would a collection service using improper debt collection practices be subject to?
Tap to reveal answer
The FDCPA gives parties injured by unfair collection practices the right to sue for damages. It does not provide for any of the other answers given.
The FDCPA gives parties injured by unfair collection practices the right to sue for damages. It does not provide for any of the other answers given.
← Didn't Know|Knew It →
Of the following defenses, which would a surety be able to assert successfully to limit the surety’s liability to a creditor?
Of the following defenses, which would a surety be able to assert successfully to limit the surety’s liability to a creditor?
Tap to reveal answer
A surety may raise his or her own contract defenses to limit his or her liability, thus the surety’s own incapacity is a defense to the surety promise.
A surety may raise his or her own contract defenses to limit his or her liability, thus the surety’s own incapacity is a defense to the surety promise.
← Didn't Know|Knew It →
Of the following rights and liabilities, which does a surety have?
Of the following rights and liabilities, which does a surety have?
Tap to reveal answer
A surety does not have the rights listed, as the surety acts to back up the debts of another party. Thus, the surety would have the liability on debt they agreed to backstop.
A surety does not have the rights listed, as the surety acts to back up the debts of another party. Thus, the surety would have the liability on debt they agreed to backstop.
← Didn't Know|Knew It →
Of the following rights and liabilities, which does a surety have?
Of the following rights and liabilities, which does a surety have?
Tap to reveal answer
A surety does not have the rights listed, as the surety acts to back up the debts of another party. Thus, the surety would have the liability on debt they agreed to backstop.
A surety does not have the rights listed, as the surety acts to back up the debts of another party. Thus, the surety would have the liability on debt they agreed to backstop.
← Didn't Know|Knew It →
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Tap to reveal answer
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
← Didn't Know|Knew It →
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Tap to reveal answer
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
← Didn't Know|Knew It →
Which of the following events will release a noncompensated surety from liability?
Which of the following events will release a noncompensated surety from liability?
Tap to reveal answer
A non-compensated (or gratuitous) surety is bound to the contract if he or she makes a promise to act as a surety prior to consideration changing hands from the creditor to the debtor. A gratuitous surety is released from liability only in a change of the original contract.
A non-compensated (or gratuitous) surety is bound to the contract if he or she makes a promise to act as a surety prior to consideration changing hands from the creditor to the debtor. A gratuitous surety is released from liability only in a change of the original contract.
← Didn't Know|Knew It →
Per the Federal Fair Debt Collection Practices Act, which of the following would a collection service using improper debt collection practices be subject to?
Per the Federal Fair Debt Collection Practices Act, which of the following would a collection service using improper debt collection practices be subject to?
Tap to reveal answer
The FDCPA gives parties injured by unfair collection practices the right to sue for damages. It does not provide for any of the other answers given.
The FDCPA gives parties injured by unfair collection practices the right to sue for damages. It does not provide for any of the other answers given.
← Didn't Know|Knew It →
Of the following defenses, which would a surety be able to assert successfully to limit the surety’s liability to a creditor?
Of the following defenses, which would a surety be able to assert successfully to limit the surety’s liability to a creditor?
Tap to reveal answer
A surety may raise his or her own contract defenses to limit his or her liability, thus the surety’s own incapacity is a defense to the surety promise.
A surety may raise his or her own contract defenses to limit his or her liability, thus the surety’s own incapacity is a defense to the surety promise.
← Didn't Know|Knew It →
Per the Federal Fair Debt Collection Practices Act, which of the following would a collection service using improper debt collection practices be subject to?
Per the Federal Fair Debt Collection Practices Act, which of the following would a collection service using improper debt collection practices be subject to?
Tap to reveal answer
The FDCPA gives parties injured by unfair collection practices the right to sue for damages. It does not provide for any of the other answers given.
The FDCPA gives parties injured by unfair collection practices the right to sue for damages. It does not provide for any of the other answers given.
← Didn't Know|Knew It →
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Tap to reveal answer
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
← Didn't Know|Knew It →
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Tap to reveal answer
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
← Didn't Know|Knew It →
Which of the following events will release a noncompensated surety from liability?
Which of the following events will release a noncompensated surety from liability?
Tap to reveal answer
A non-compensated (or gratuitous) surety is bound to the contract if he or she makes a promise to act as a surety prior to consideration changing hands from the creditor to the debtor. A gratuitous surety is released from liability only in a change of the original contract.
A non-compensated (or gratuitous) surety is bound to the contract if he or she makes a promise to act as a surety prior to consideration changing hands from the creditor to the debtor. A gratuitous surety is released from liability only in a change of the original contract.
← Didn't Know|Knew It →
Of the following defenses, which would a surety be able to assert successfully to limit the surety’s liability to a creditor?
Of the following defenses, which would a surety be able to assert successfully to limit the surety’s liability to a creditor?
Tap to reveal answer
A surety may raise his or her own contract defenses to limit his or her liability, thus the surety’s own incapacity is a defense to the surety promise.
A surety may raise his or her own contract defenses to limit his or her liability, thus the surety’s own incapacity is a defense to the surety promise.
← Didn't Know|Knew It →
Of the following rights and liabilities, which does a surety have?
Of the following rights and liabilities, which does a surety have?
Tap to reveal answer
A surety does not have the rights listed, as the surety acts to back up the debts of another party. Thus, the surety would have the liability on debt they agreed to backstop.
A surety does not have the rights listed, as the surety acts to back up the debts of another party. Thus, the surety would have the liability on debt they agreed to backstop.
← Didn't Know|Knew It →
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Brown cosigned Royal's $50,000 note to State Bank. If Royal is later adjudicated mentally incompetent, what would be Brown's liability on the note?
Tap to reveal answer
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
Any contract made by a party legally deemed incompetent is voidable, and a voided contract would release the liability of all parties involved.
← Didn't Know|Knew It →
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Which of the following rights does a surety have?
I. Right to compel the creditor to collect from the principal debtor
II. Right to compel the creditor to proceed against the principal debtor’s collateral
Tap to reveal answer
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
As a rule, a surety generally has no rights to compel the creditor to collect from the principal debtor. Such rights are only available to a guarantor of collectability, who is liable only if the creditor has exhausted all other legal remedies.
← Didn't Know|Knew It →