Credit Evaluation School Instructor eBook - Oct 2023

SCENARIO 5  Bank advanced $15,000 the purchase of a vehicle worth $15,000 at the time of purchase.  A year later, the borrower was in an accident and totaled the vehicle.  Borrower had been running late on payments and had a loan balance of $14,000 at that time.  The insurance company determined the vehicle was worth $10,000.  The borrower does not have the ability to pay any shortfall.  For this loan, would you recommend:  Pass  Special Mention  Substandard  Doubtful  Loss