NCBE Uniform Bar Exam (UBE) Practice Exam 2025 - Free Bar Exam Questions and Study Guide

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When is payment due on installment contracts under the UCC?

At the end of the contract term

Upon delivery

In the context of installment contracts under the Uniform Commercial Code (UCC), payment is typically due upon delivery of the installments. This principle aligns with the nature of installment contracts, which involve payment in segments as the goods are delivered rather than waiting until the end of the contract term or after full performance has been completed.

The UCC recognizes that with installment contracts, the buyer usually has an obligation to pay for each delivered installment when it is received, which facilitates a more fluid and manageable transaction process. This is particularly important in commercial transactions where the buyer may need the goods immediately and is expected to make payments concurrently with receiving those goods.

In contrast, other options like payment at the end of the contract term, after full performance, or before any delivery occurs do not reflect the reality of how installment contracts function under the UCC. These alternatives could disrupt the intended payment structure that supports ongoing performance and delivery of goods over time.

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After full performance

Before any delivery occurs

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