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Interest rates must be shown on the Contract as “APR*” so Buyers can understand the actual yearly cost of borrowing
*APR means “Annual Percentage Rate”CorrectIncorrect
Dealers must convert all interest rates to standard APR (Annual Percentage Rate.
The Annual Percentage Rate (APR) is the annual rate charged for the Buyer’s loan, shown as a percentage that represents the actual yearly cost of borrowing over the term of a loan.
The “Car Buyer Bill of Rights” limits a Dealer’s compensation from an institution financing the purchase of a vehicle to:CorrectIncorrect
California’s “Car Buyer Bill of Rights” (AB 68) limits a Dealer’s compensation from an institution financing the purchase of a vehicle is limited to no more than:
- 2.5% for terms up to 60 months
- 2.0% for terms of 60 months or longer
This limitation does not apply when the assignment requires the Dealer to bear the entire risk of financial performance for the consumer or when the assignment is more than six months after the date of the Conditional Sale Contract.
Dealers must disclose all Terms of Financing, including any item purchasedCorrectIncorrect
Dealers must disclose all Terms of Financing, including any item purchased