If a Holder Presents a Note for Payment to the Maker

question 2

Multiple Choice

If a holder presents a note for payment to the maker, which of the following warranties is\are given?

• A) All indorsements are genuine.
• B) All signatures are genuine.
• C) The holder has no knowledge that any indorsements are forged.
• D) The holder is entitled to enforce the note or is authorized to obtain payment on behalf of the person entitled to enforce the note.
• E) All of these.

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Definitions:

Warranty Exist

Warranty exist implies the presence or provision of a guarantee by a seller that the products or services offered meet certain criteria of quality and reliability over a specified period.

Operation of Law

Legal changes or transfers that occur automatically due to established legal rules, rather than through actions by the parties involved.

Implied Warranties

Warranties not explicitly stated but are assumed in transactions, ensuring goods or services meet reasonable expectations of performance.

Due-on-sale Warranties

Clauses in a mortgage agreement that require the full loan balance to be repaid if the property is sold.