Free Financial CFSA Exam Questions (page: 16)

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Common type/s of installment loans is/are:

  1. Credit card loans
  2. Residential loans
  3. Mortgage loans
  4. All of these

Answer(s): C



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Types of commercial loans are /are:

  1. Installment loans
  2. Floor plan financing
  3. Asset-based financing
  4. Both B and C

Answer(s): D



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Management of the lending institution sets a reserve for loan losses at a given point based on such factors as mentioned below EXCEPT:

  1. Number and type of loans made
  2. Quality of loans made
  3. Historical loss experience
  4. Loan portfolio

Answer(s): D



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If more funds than expected are needed to cover loans losses in a given period, the reserve must be increased and the difference is charged to:

  1. Administration expenses
  2. Prepaid assets
  3. Operating expenses
  4. Loan expenses

Answer(s): C



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When a loan becomes delinquent or when collection seems unlikely, banks often suspend:

  1. Accrual of interest
  2. Deferral of interest
  3. Loan losses
  4. Loan prepayments

Answer(s): A



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