Credit Evaluation School Instructor eBook - Oct 2023

Internal Use Only

Corner, Inc. – Pass • Sports bar with great location near AT&T ball park and train station, owned and operated by Sam and Diane Claven. • Diane’s parents are long term customers of the bank and have over 1MM on deposit with the bank. • Diane is a nurse but quit her job in order to work full time in the bar; however, has since returned to nursing at 75M per year salary and benefits. • Prior classification was from time when Diane was not working as a nurse and bar didn’t have the capacity to pay salaries to both Sam and Diane along with their health insurance. • Slightly past due but brought current DX. People: Sports bar near AT&T Ball Park and train station, owned and operated by Sam and Diane Claven. Purpose: Purchase of the commercial property housing the bar, original note balance 215M. Payment: Monthly payments of 2,117 required, equates to 15 year amortization. Protection: First REM covering the commercial property, appraised at 1,500M. The Clavens purchased the real estate at a very favorable price from an associate of Diane’s parents. Performance: Payments have been made as agreed for past few years. Initially there were payment issues as Diane quit nursing job and bar was paying salaries and insurance for both. Diane has gone back to nursing and there have been no payment issues since that time.