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Urgent Message about Church MortgagesTo: Church Pastors, Treasurers and Boards From: “The Church Lady”, Cheryl Meglio Urgent Message! Can the Way that Your Church Pays Their Mortgage Be the Catalyst for Banks Not Loaning to Churches Now and in the Future? Perhaps it sounds crazy to ask that question. Certainly the way we pay our mortgage has little or no effect on anyone else getting a bank loan in the future. Or does it? Economic times are hard right now and churches are struggling with diminished congregation sizes, and smaller incomes. But how you handle your indebtedness will determine if the next church body that needs a church loan will be able to get one. Traditionally, most banks are afraid to give churches loans because they don’t understand why people would give money faithfully and support the church. It’s more difficult for them to review our books and determine how we function, because part of the church’s ministry is to give money away to help people. “But most of all, banks don’t want to give churches loans because they never want to be the bank that forecloses on a church, it is a public relations nightmare for them.” Think about their position for a moment, you have 50-100-300, or even 1500 members, that are part of the community. If they foreclose on you, those members and everyone they can talk with will say bad things about their bank. The news might hit the paper, and now everyone is talking about the bank that foreclosed on a church. 1 of 4 We need to remember something else, something that was very much understood 50-100 years ago; the banks loan money based on the savings of the people in the community. Some of that changed as home loans are now sold to the “secondary money market”. But a loan to build or buy a church is a loan from the funds deposited at the bank by the community. Whenever a church loan is foreclosed upon, it is a big deal for that bank! The bankers remember the foreclosure and the trouble it caused them and the loss of income the bank suffered. Those bankers may be in the business for the next 20-30+ years. They may not stay at the same bank, but they bring that experience with them. “We must preserve the ability to obtain loans for the At one bank, I was told that the bank had a church that had just been foreclosed on in Unbelievable! You mean to tell me that one church in Sad, but true, one foreclosure carries that much weight. That particular bank is loaning to churches again, but now they are requiring that the church be affiliated with a denomination (before an independent church could get a loan), and they have tightened their criteria in other areas as well. They didn’t loan to any church for over a year! That is the result of just a couple of churches defaulting on their loans over many years. Right now there are a few churches in the p.2 of 4 This information may not pertain to you or your church, but please help your ministry friends across the nation understand the principle! Please send them a copy of this or refer them to my website to read this article. Or, you may be reading this and wondering how to pay the next mortgage payment for the church, and asking yourself , “ What can I do about that?” You think you are alone, but you are not. There may be 100 churches in the Metro St. Louis/St. Charles area facing that same dilemma today. You may see now why this is such an Urgent Message to our Church Community! I am sure you have already been in prayer for provision and looked at every asset that you have, so let me give you some other ideas. 1. Don’t wait until you are financially busted, and then give the building back to the bank. Talk to your lender when you will be making a payment late. (Remember, a couple of days late is no big deal, but when you are approaching 30 days it’s time to talk with your lender. Let them know that you are working hard to keep them paid on time, and look at options so you can continue to do that!) 2. Let me help you sell it! Get the albatross off of your back. Look at selling it and renting from someone for a time to give your church time to rebuild their finances. Owning and maintaining a building is more expensive than renting, because of maintenance. 3. Be pro-active in the use of your space by renting some of it to another church to share with you. Oftentimes small church starts or churches in transition are looking for somewhere to meet and would love to meet at your church! Perhaps I can help you find someone to rent your space! Be creative, someone can rent your church chapel, the main sanctuary, the fellowship hall or a classroom set up as a chapel. 4 Begin to look at alternatives. Perhaps your congregation is too small for the building that you are in, and you can no longer p. 3 of 4 4. maintain it. Moving to a smaller building is an option! Moving into rental space is an option! Don’t let the roof leak on your head for a year and then decide it’s time to close, and now you have a deteriorated building that is difficult or impossible to sell. Consider other non-profit businesses that you could rent to or that the church could operate that would bring in money to support the church. If your congregation is swallowed up by your building size, call me today. Let’s make a change for your church, and to protect the lending ability of the Kingdom for the future. You will be surprised how the momentum returns to your congregation when the people’s giving makes a difference in people’s lives again, instead of just maintaining the building. That’s when the blessing is upon the Church, when the Lord’s Presence is there when you are able to minister once again to the needs of the people. The perfect replacement building may not be on the market today, but as churches begin to heed this sensible approach to stewardship over Kingdom funds and buildings, more buildings will be on the market soon for you to pick from. Thank you for taking the time to consider this dilemma and to help pass along the word that we really are not an island unto ourselves. May God, in His Might and Power, continue to Abundantly Bless you and His Ministry through you, in Jesus’ Name. Amen. Cheryl Meglio “The Church Lady” Specializing in the 314-457-1010 Office/ 314-498-5555 mobile p. 4 of
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