Church Financing – Still a Tough Market

Churches continue to have difficulty getting the financing they need for buildling or relocation. We have seen any number of churches that should be able to get financed turned down by lender after lender. Many churches that are getting turned down for financing today could have been financed a year ago with exactly the same financial statements. The biggest impediment to financing is inadequate cash flow – not enough money left after expenses to service a mortgage. Unlike previous years, lenders are not willing to wager that the church will reduce discretionary expenses to service a mortgage or increase income because of growth. Today, lenders want to see 6-12 monts of financial history showing a cash surplus sufficient to cover a mortgage.

Many churches are qualifying for loans, they’re just qualifying for significantly less than last year, and less than they need for the church plans they have. For churches that cannot qualify for as as large of a loan as they need in order to build, they need to raise the difference in cash.
There are three things that a church can do to improve cash flow. The church needs to apply a sharp knife and cut expenses, it needs to faithfully preach and teach about giving and stewardship, and it needs to run a capital campaign (which will also help with coming up with the cash difference between what they need and what they can borrow).
Cutting expenses is difficult, but a necessity for many who want to build. Trimming expenses and increasing income and cash on hand through a capital campaign is the financial answer to many of today’s church financing problems.

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Capital Campaign Feedback

I had a status call today with a church capital campaign client this morning, and the chairperson had a most insightful and encouraging comment.  The church is two weeks away from their Committment Sunday when everyone will bring their initial offerings and ongoing peldge commitments for the 3-year giving period.   His comment to me […]

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The Year of the Church Capital Campaign

The banks have money to lend, they just don’t seem to want to do it. This week a number of the largest banks were called before Congress who basically told them to make more of the bailout money available for loans. Some lenders have just stopped lending to churches while others are setting the bar […]

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Economic Crisis Affecting Capital Campaigns

Depending on what part of the country the church is in, the current economic downturn most likely affected the results of capital campaigns that were kicking off this fall. Based on the results of our church capital campaigns that were already in the planning stage for kickoff this fall, pledge commitments received are substantially less […]

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Tips on Selecting a Church Architect

If you are looking for a church architect, here are some tips that you will want to keep in mind that will help you get the right architect for your church building program. First and foremost is that there is a difference between an architect that has designed some churches, and a church architect. Designing […]

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Church Building Plans – The New Paradigm

I am really exited over the relationships we have built with a number of church builders and architects. However, the relationships I am the most stoked over today are those with 3 forward looking architectural firms (who all have a heart for the church) that I believe are driving a paradigm shift in how many […]

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The Biggest Mistake in Church Design

As I look back over the years and hundreds of church building stories I’ve heard, by far the single biggest mistake made by churches in the design process is the failure to have a firm and reasonable budget at the front-end of the design process. This is a joint failure on the part of the […]

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Church Building Guide

Need a guide to church construction? I’ve put up a new web site dedicated to my book, Preparing to Build. Here’s the official description, Written by an experienced church building consultant, Preparing to Build is over 170 pages of real-world, practical information that will equip your leaders and church building committee to properly prepare for, […]

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Church Capital Campaign: The Biblical Basis

I occasionally run across folks that think that a church capital campaign for a building program is a bad idea. Some have even called it unscriptural, but in in my opinion, its just the opposite. Perhaps people get caught up in the terminology, but a capital campaign is really just a name for designated offering […]

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Church Grants – Part I

Many churches today are seeking church grants for a variety of purposes, including construction. According to Bernice Sanders Smoot of Saint Wall Street, there are over 600,000 churches and faith based organizations in the USA and my experience is that most of them are looking for money. With only a very few thousand faith-friendly grant […]

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