Business Law- Credit and Bankruptcy
A balloon note has one large payment up front then a series of smaller payments over time.
False
A debtor filing for Chapter 7 bankruptcy must provide a list of all immediate family members because persons such as spouses may be liable for the bankrupt person's debts.
False
A mechanic's lien applies only to "mechanical" work, such as car repairs or plumbing work on a house.
False
A mechanic's lien is also called an artisan's lien.
False
A negotiable instrument is a promise by one party to pay a undefined sum of money to another party. There are two parties: the maker and the payee. While the amount to be paid may vary, the date of payment must be set at a specific time in the future.
False
A note involves two parties, the maker and the payee. Payment must be on demand.
False
According to the Statutes of Fraud, mortgages may be either oral or in writing.
False
An open account is the least common form of business credit account. An open account is the least common form of business credit account.
False
Chapter 13 bankruptcy proceedings are used mainly by businesses.
False
A(n) ____ has the same contract responsibilities as an assignee under a nonnegotiable instrument.
Ordinary holder
A financial institution that receives a promissory note has the right to:
Sell the note to another party
A cashier's check is a form of check in which the bank is both the drawer and the drawee.
True
A check is a draft drawn on a bank and payable on demand.
True
A garnishment is when a creditor gets the right to attach a certain percentage of a debtor's wages.
True
A person who files bankruptcy may not file again for another eight years.
True
A secured creditor is one is able to take a non-paying customer's property to satisfy the customer's debt.
True
Even though a person is declared bankrupt, he or she will still have to pay back student loans; they are usually not eliminated.
True
A mortgage will typically contain:
a description of the property and the amount of debt involved
A(n) ____ is a court-ordered seizure of goods from the customer to prevent the customer from disposing of it during the lawsuit.
attachment lien
Alimony and child support payments, back taxes and most student loans are all examples of:
debt that is not extinguished by bankruptcy
A mortgage:
is a debt obligation (lien) attached to real property and gives the mortgagee the right to sell the property in case of default
A ____ is issued by the clerk of the court and directs the sheriff to seize and sell any of the debtor's nonexempt real or personal property within the court's jurisdiction.
writ of execution
