Church Mortgage Guidelines

 

Eligibility

The Church provides a Statement of Faith/Core Values/Beliefs for organizational

Membership eligibility and approval

 

Loan Amount

The loan amount generally should not be greater than 3 times the average annual general fund income.

The real estate used as collateral must meet loan-to-value guidelines based on a

first lien position on the following types of property:

 

Up to:

70% Multi Use                                                    70% Single Use (Church)

65% Educational                                                 40% Camp and Conference

50% Undeveloped Land                                     80% Ministry Owned Residential

 

Capacity

The Church's total debt payments for loans and leases should not exceed 30%

(15% for schools) of the average annual general fund income.

The Church's general fund's Annual NET INCOME should be able to cover at least

110% of the new and existing aggregate annual debt and lease payments.

 

Additional Guidelines

The Church has a minimum 5 year financial history

At least three years of stable or growing church attendance history

Excellent payment history with current lender

Construction Loans need a minimum of 25% borrower contribution on construction

loans.

30% down payment required on purchases

Guaranteed maximum price contract

Payment and performance bond

Recording of loan documents before ground breaking

 

Pre-Qualifying For A Loan

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CBL is pleased to have the opportunity to offer its financial services to your congregation. Upon receipt of the information listed below, We will have a preliminary evaluation of the church's borrowing capacity under the program guidelines.

1.  A brief description of your loan request: amount, purpose, etc.

2.  Financial statements for the last 3 fiscal years. The financial statements should include balance sheets, income/expense statements and any supporting exhibits. NOTE: The statements should reflect all operations including day care, school, etc. In the event such operations are separately incorporated, similar information may also need to be provided for those entities.

 

3.  Interim financial statement (balance sheet and income statement) for a current year-to-date period.

4.  Three months of most recent account analysis and/or bank statements.

5.  Average weekly adult worship attendance for each of the last 3 years (2005, 2006 and 2007). This number should include only the primary worship service(s), which any given adult would attend in a typical week (i.e. Sunday morning or perhaps Saturday night).

6.  Current and proposed seating capacity (if applicable).

7.  Number of worship services per week and seating capacity of sanctuary.

8.  Church's top 15 donors for the fiscal year ending 2007. Please provide the initials of the donor and the total amount that donor gave in the year.

9.  Describe any existing or planned capital pledge campaigns. Include the start (or anticipated start) date, end date, purpose of the campaign, amount of gross pledges, total amount collected to date by each fiscal year. If readily available, it is also helpful to have similar information on recently completed campaigns.

10.  If funds are for a construction project, please provide a brief description of the project including target dates, anticipated costs and means of funding such. In addition to hard construction costs, be sure to indicate any items that may have already been paid such as land costs and architectural fees. Soft costs such as furniture, fixtures, equipment and landscaping should also be included.

11.  Articles of Incorporation and By-Laws

 

 

 

Sources and Uses

 

 

 

Tips for filling out a Sources and Uses Statement:

 

1. If you have recently acquired a site, the lender will want to know the actual cost

          of the site and the date it was purchased.

1. The City or County may require you to lay new roads, install turning lanes or streetlights, or install utility lines. Be sure to research these items when you are putting your budget together.
2. The "Cash Spent" amount should include all expenses incurred so far on items in the "Uses of Project Funds" categories. Be sure to include the date of this calculation.
3. The lender will want to know your actual cash on hand as of the date of your application. Only include funds that are available for the project; do not list funds that are committed to other uses.
4. You may include a reasonable projection of the additional cash you anticipate receiving prior to loan documentation. The lender's financing commitment letter may require that you have that cash before the loan is documented.
5. If you plan to sell an existing facility to generate the required funds, the sale must be completed before the loan documents are executed. Otherwise, the funds should not be considered as a reliable "Source".
6. To determine the amount of debt required to complete your project, start with the Total Uses figure and subtract all other Sources figures. That will be the amount your church seeks to borrow.
7. The Total Sources figure and your Total Uses figure must be an identical amount.

 

 

 

 

 

Your Name*
Church Name*
Phone Number*

 

 

 

 

 

Uses of Project Funds	Sources of Project Funds
Refinance Existing Debt
Fundraising Expenses
Purchase Land (actual cost)
Site Work		Cash Already Spent through (date)
Architectural Fees		Current Cash on Hand as of (date)
Soft Costs		Additional Cash before loan documentation
Hard Costs		Sales proceeds from existing land or bldg.
Offsite Costs		Debt (construction and/or mortgage loan)
TOTAL		TOTAL

Contact:

Charles Adams

Commercial Business Lenders. Inc. www.commercialbusinesslenders.com

email: cadams@commercialbusinesslenders.com

tel: 866-570-8428  fax 336-510-7507  tel 336-233-3285