The late 1990’s had seen a surge of Convenience and Gas (C&G) loans made through Wall Street Banks in the CMBS markets. Due in part to poor quality appraisals that over-leveraged the C&G assets, as well as high prepayment penalties in a declining interest rate environment, the market began to unravel in 2000. It experienced some of the largest defaults rates ever witnessed on the underlying bonds. (It was something of a harbinger of the 2008 sub-prime debacle that unfortunately no one paid attention to.) A CMBS borrower that PetroVal interviewed indicated that the oil company’s retail assets were more than 100% leveraged with a high interest long term loan. They simply stopped making their payments and were prepared to hand over the keys and walk away satisfied they had sold their assets to the unfortunate bondholders, who had hoped for a long-term income stream.