Church Financing Options & Mortgage Loans
The Halo Capital Group understands that church financing may at times be necessary in order to continue the mission of the church. Financial management and budgetary planning of voluntarily given funds can be difficult and insufficient. Apply today and allow us to review your financial situation so we can make recommendations to assist you.
The Cash Flow Limitations of Church Fundraisers
Most church financing is obtained through donations made by members but many churches experience shortfalls with respect to working capital. The current economic crunch has made financial security difficult to achieve; therefore, many churches must find alternative methods of meeting financial obligations. Organizations such as Better Fundraising Ideas provide suggestions of tried and true church fundraiser ideas. Other companies such as ABC Fundraising provide the products that can be sold by the church to raise needed capital. Sometimes funding is made available from a mother church or organization and sometimes operating funds are gifts or bequeaths from current or previous members. But more often the funds through which a church survives are donations of those who attend services on a regular basis. Unfortunately, few fundraisers generate enough church building funds to complete major projects. Funding through church grants and church loans must be sought from outside sources.
Church Mortgages & Lending
A church mortgage is different from that of a residential mortgage. To this regard, churches are treated as businesses and the repayment period is much less than that of home owners. Local building departments require commercial blue prints and licensed commercial building contractors for church structures. These requirements drive up the cost of the construction. Most mortgage companies and banking facilities require mounds of paperwork, higher interest rates, personal guarantees and collateral for security. In addition, loan approval and release of funds may take weeks or months.
The Church Loans & Investments Trust Company provides mortgage loans to churches within the USA. Unfortunately, their minimum loan amount is $3,000,000 and they require a minimum attendance of 500. If your church is relatively small and reaching these goals is impossible, contact Halo Capital Group. We have a “performance based” program designed to take into consideration your entire financial picture not just your credit score. We require minimal paperwork, reasonable interest rates, no personal guarantees, no collateral and funds can be made available in days. We are here to help you. Connect with us today to learn for yourself what services we offer and how we can best serve you.
Church Mortgage Rates
Mortgage rates can vary greatly depending on the mortgage lenders and the financial standing of the church. A loan calculator can be found free of charge on the internet. A church mortgage calculator can be of assistance when determining the actual loan cost.
Church Construction Loans & Grants
Church building loans are available through commercial banks, financing companies and church lenders. Most church construction financing entities have stringent church lending guidelines, high interest rates and a requirement for the church to fund at least 20% of the total construction cost. Church mortgage loans have the same basic regulations in addition to the requirement for liens on the property.
Most grants for church expenses are meant solely for one denomination. However, few grant funding organizations have sufficient funds to cover building financing. Most grants are for much smaller amounts and are designed for church programs and church equipment financing. Church building grants are usually limited to grants for church repairs rather than for new construction. One exception would be church plant funding when the home church or denominational governing body contributes to the cost of starting a completely new church in a completely new location.
Getting Small Church Loans
Small churches may experience more difficulty with church finances than larger churches. Inconsistent collections may make even general operating costs a hardship and continued church debt inevitable. Small church loans, loans to members or loans to pastors must in some cases be sought in order to meet financial obligations. Halo Capital has an unsecured business loan program that may be the solution to this dilemma.
Financing through the Baptist Church
The Baptist Loan Corporation is a group designed to provide loans for building construction, building renovations, etc. However, they only finance 60% to 75% of the project, require a loan ratio of 25% to 30% and retain a lien on all church land and improvements. Their Capital Stewardship Pledge Loans require a three year pledge campaign through which a sufficient amount of pledges are received as a source for loan funds. The church must commit the remainder of the pledges to pay off the loan within four years.
The State of Church Finance
The “church finance today” topic is addressed in books, in magazines and on websites. Handbooks are made available at little or no cost to assist church staff to better understand the laws pertaining to both church activities and not-for-profit tax designations. Before you agree to the church funding guidelines from any loan/investment trust company or other lending source, contact Halo Capital Group. Our staff is devoted to providing the funding needed by churches to operate, to build and to grow. Complete and submit your application and we will be happy to find a lender that is fulfills your needs.