Published On: Tue, Aug 10th, 2010

When Internal Factors Are In Line with Ministry, External Hurdles Can Be Cleared

By: Lee Walker

In today’s economic climate of tight credit and caution among borrowers and lenders, it’s certainly no surprise that church construction projects are being put on the back burner by many congregations.

And while financial institutions have increasingly stricter criteria for lending, congregations must realize that church expansions have actually thrived during economic recessions. With that in mind, church leaders must consider factors outside of the congregation (lending climate) and those within (vision, ministries) when planning an expansion.

Prior to even considering a building project, leaders must take the pulse of the congregation in terms of enthusiasm, levels of giving, and ownership of the construction process. If the church has a clear cut vision of its ministry and how to engage members, then all of the other hurdles can be cleared. Historically, we’ve seen that in many churches giving increases during tough economic times. Why? Because members identify with the ministry and its goal of serving the Kingdom.

This is consistent with Scripture:

“Without vision, the people will perish.” Proverbs 29:18

Lee Walker

A church must also realize that a “building” will not necessarily result in attracting new members. But building a ministry will inject new enthusiasm into a congregation which will result in healthy membership growth. And many times, “building” a ministry involves building a new structure.

God continually tells us He will build his church, and that has nothing to do with the current economy. It has everything to do with building the Kingdom and serving God. With that in mind, if members feel part of the ministry and are called, they will support the congregation’s activities – building, mission work, community outreach, etc.

We can’t be naïve and think that money isn’t important in the process. If the bank account is too small, then maybe God is telling us it’s not the right time. But there may be other reasons for lack of funds. Perhaps the congregation isn’t on board with leaders’ vision for the church. Just as likely is that their hearts are not in line with the various ministries of the congregation. If that’s the case, then leaders must change direction or do a better job of communicating the vision of the church.

Once the internal dynamics of the church are established and members are on board with the vision, then church leaders can address the “external” factors, which in this case, involve dealing with financial institutions.

Actually, these stricter guidelines, in a very real sense, are Biblically based. They force church leaders to be good stewards, avoid high levels of debt, establish a vision and mission, and to represent the Kingdom in a responsible manner.

“Perhaps the most prominent factor is that lending institutions have stronger criteria for church lending than they do for commercial buildings simply because at the end of the day, they don’t want to foreclose on a church,” said Bill Brown, president of South Florida-based Glory Associations, a funding and financing consulting firm for churches. “They understand that it just wouldn’t look good to foreclose on a church based on the good work it does in the community.”

There are additional factors that church leaders must also understand when initiating a building program.

“The most obvious difference is that a commercial building has a definite value,” said Brown. “For example, an office building has multiple tenants thereby giving value to building. A church is a single-purpose building and can pretty much only be used as a church.”

Consequently, financial institutions may ask questions of a church that they may not for a traditional commercial project. These questions must be answered within the context of describing the church project as a ministry and a way to honor God, not man. This is a constant message in Scripture and should be a guiding light as church leaders consider and pursue growth.

If the land you possess is defiled, come over to the Lord’s land, where the Lord’s tabernacle stands, and share the land with us. But do not rebel against the Lord or against us by building an altar for yourselves, other than the altar of the Lord our God. Jos 22:19

According to Brown, if we stay true to Biblical practices, the process will sort itself out from financial and ministerial perspectives. Lending institutions will look at issues that really delve into the heart of a church community.


Brown stresses that churches must consider a church building/expansion program a multi-year process.

“Church leaders can’t go to a congregation and tell them that they must raise $1 million in the next 60 days to proceed,” said Brown. “Rather they must put in place a 2-3 year program that maps out a campaign.”

This campaign can include:

  1. Regular newsletters detailing the project, the rationale, etc.
  2. Announcements on progress
  3. Distribution of commitment cards, asking members to donate funds – in small increments – over a period of time. Perhaps $2,000 over 2-3 years.

This campaign involves continually updating the congregation on all aspects of the process:

  1. Selection of building committee
  2. Architectural designs
  3. Timeframes – if possible

This is the first step in showing lending institutions that the church is serious, from a financial standpoint, in securing financing.

Health of the congregation

Congregations must also show a significant level of stability in terms of staff, tithing, and reserves. Brown sites these points as issues that lending institutions will consider:

  1. Pastor must be in place for at least five years, a clear indication of strong leadership and stability. Historical analyses show that churches lose money and members when a pastor leaves
  2. Should display growth in membership over a three-year period
  3. Should show an increase in the number of  “giving units” – families, singles.
  4. Lending institutions are also aware that the national average, based on 2008 figures, for giving is approximately $675 per unit. So they will be looking closely at that figure as a way to gauge income and the health of a congregation.
  5. Reserves are another important factor when it comes to securing a loan.

Based on these indicators, it’s not unusual for lending institutions to lend approximately 75 percent of the value of the property and the projected building.

Lending institutions will be interested in several other factors. For example, would a church consider adding another service as a way to raise additional funds? They will also look closely at the actual projected building. Is the planned sanctuary too large for the current membership? Does the church need an ostentatious sanctuary as opposed to a youth building? Today’s trends show that churches are building multi-purpose structures that can serve as sanctuaries, gymnasiums, and meeting rooms. Lending institutions seem to prefer this more conservative process, allowing churches to expand when necessary.

Churches today must be well educated in stewardship, finance, and construction. And in most cases, lenders prefer to see congregations bring in outside, objective professionals to assist with the entire process that ultimately reflects:

  1. When to start building
  2. When to start the campaign
  3. What will be built and how is it in line with the abilities of the church and projected growth models

All of these strategies must be placed within the context of the Bible and what it tells us about building ministries.

You show that you are a letter from Christ, the result of our ministry, written not with ink but with the Spirit of the living God, not on tablets but on tablets of human hearts. 2 Corinthians 3:3

Scripture continually tells us that God is in charge of everything, and this certainly pertains to a congregation’s plans for ministry expansion, which, oftentimes involves a new building. That said, the focus is not on man’s plans to increase numbers, but God using His church to do so….as He pleases.

“…and on this rock I will build my Church.” Matthew 16:18

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