Securing Financing for Your Church Part 4

in Church Bond Investing, Church Bonds, Church Financing, Church Loans, Funding my church

In this article, we will discuss the final two of the Five Practical Steps in Securing Funding for Your Church 

4.) Put together a good project team. Just because you are a church, that doesn’t mean that you can’t use the same mindset employed by other successful businesses and organizations. Most successful companies put together project teams that communicate well, and at the same time are team players. Successful business leaders surround themselves with talented, hard-working people. Likewise, select someone from the Church to head up and establish a project team. Delegate as much authority to that person and team as they need, so they can keep the project moving in the right direction. In many instances, this person may need to be brought on staff full time to handle the project, so as to not strictly rely on volunteers to handle the project.

5.) Consider Church Bonds versus a Bank Loan. When a church secures a bank loan, that church is borrowing from the bank, and that bank loan is indirectly funded by the bank’s depositors. In many cases, the bank will have an interest in the church’s success, but the bank is more concerned with charging and receiving interest and fees on the money loaned to the church. One difference between a Bank Loan and a Church Bond is that the church bondholders are the lenders the money to the church. In the final analysis, the lending agreement of a church bond loan is between the church and the bondholders, collectively administered by an independent bond trustee. Church Bonds effectively cuts out the middleman, i.e. the bank. Banks can make more money by making loans that have a longer amortization, or payback period, which in most cases mean adjusted interest rates, and more interest and fees paid by the church to the bank throughout the term of the bank loan. On the other hand, when a church issues a Church Bond, that church has more flexibility and control of the church’s loan and repayment of that loan by having a fully-amortized, fixed interest rate throughout the entire period of the church bond loan.

Securing financing for your church can be a difficult task, but in many cases a necessary one. In the end, a proper understanding of both the financing challenges your church may face and the correct solutions to those challenges can lead to a more effective ministry and positive outcome for your church.