Community of Christ

Houses of Worship Revolving Fund Loans

Legal - Houses of Worship Revolving Fund Loans

This section references loans for “purchases” of property ONLY

If funds are needed to assist in the purchase of a property a Houses of Worship Revolving Fund (HWRF) Loan can be applied for. A loan application will need to be completed and sent to mission center officers and Legal Services, along with minutes and necessary approvals. The World Church is the only authorized lender for any congregation seeking a loan as part of the financing plan for a building program. Outside loans from a bank or church member or any other source are not permitted. By keeping all loans “in-house” we avoid any possibility of a loan being called due or a property being foreclosed on by others. Rates and terms for HWRF loans are kept favorable to the congregation due to the ability of the World Church to secure debt at favorable terms.

1.  Loan Terms and Incentives

Houses of Worship Revolving Fund loans are made to campgrounds, congregations, emerging congregations, and mission centers for the purchase, construction, expansion, or major repairs and remodeling of their church facilities. Although emerging congregations may accept responsibility for repaying HWRF loans, it is understood that the sponsoring mission center must accept contingent liability for the loan should the congregation be unable to repay on schedule. In effect, the sponsoring jurisdiction must “co-sign” a HWRF loan to an emerging congregation.

The maximum amount of World Church funds available for projects is up to two-thirds (2/3) of the total project cost, with the congregation paying the remaining one-third (1/3). The congregation must use their one-third (1/3) prior to making draws against the loan. Loans $200,000 and over require further review and approval by the Presiding Bishopric. Approval of each loan is based on the following criteria:

1.1 Availability of Houses of Worship Revolving Funds.

1.2 Demonstrated ability to repay the loan, including the completion of a capital campaign, if necessary.

1.3 Disclosure of congregational planning, financial and growth performance, and compliance with the procedures outlined in this document.

1.4 Satisfaction of the World Church Insurance and Bonding Requirements by all contractors involved in the project.

1.5 Placement and maintenance of the congregational insurance program within the World Church Insurance Program.

1.6 Full compliance with the approval process designated by the Presiding Bishopric.

The repayment period on new loans is:

    loans under $15,000.00—5 years
    loans $15,000.00 and over—15 years
    loan terms over 15 years MUST be approved by the Presiding Bishopric.

Interest rates for loans will be set by the Presiding Bishopric as of January 1 of each year. The new rate will reflect the average cost of funds in the previous 12 months, rounded up to the next highest multiple of 25 basis points. Interest rates for all outstanding loans will be adjusted at that time, with the new rate affecting the February payment (interest is paid in arrears).

Regular loans will have a maximum rate of:

    6% for the first five years,
    7% for the second five years,
    8% for the final five years.

To allow for congregational budget planning, the payments for regular loans will be set as if the loan were made at the maximum level of interest, i.e., 6%, 7%, and 8% for each five-year interval that applies. Interest will be charged and calculated as explained above, and the allocation of principal and interest for each payment can be viewed on the following month’s statement. In this way, congregations will enjoy the benefit of interest rates lower than the maximum through a faster amortization and quicker repayment period.

Interest on HWRF loan proceeds, released during construction, will accrue at the prevailing rate set by the Presiding Bishopric in accordance with the procedure outlined above. The maximum rates referenced in that section will not apply until all draws are taken and a permanent Promissory Note is signed. Interest-only payments will be due 30 days after the first draw, and monthly thereafter until the final note is signed.

Once approved, a loan commitment shall be effective for one year. If construction or remodeling does not begin within that time frame, a loan commitment extension for an additional year must be requested by the congregation or mission center seeking the loan. It is possible that financial conditions and/or administrative personnel may have changed and a new application will be required.

2. Requests for Draws

Requests for draws shall be in writing, and may be faxed (816) 521-3099 or e-mailed to with supporting documentation to accompany each request. When requesting draws by fax or e-mail the original request must follow by regular mail. Requests for draws may come from either the pastor or congregational financial officer.

With each draw requested an Interim Note will be sent to the congregation for signature by the pastor and congregational financial officer acknowledging receipt of the check or wire. Once signed one original Interim Note is to be returned to Legal Services and the second original is to be held for the congregation’s records. No additional draws will be made until the Interim Note for the previous draw has been initialed, signed and returned to Legal Services. Once all funds have been drawn the Interim Notes will be replaced by a Promissory Note.

3. Payment of Invoices

Checks will be made payable to the vendor/contractor and can be mailed to the pastor or congregational financial officer for delivery, or directly to the vendor/contractor. Another option for payment is electronic funds transfer (EFT) to the vendor/contractor’s bank account. To have funds electronically transferred to the vendor/contractor the following information is needed from the vendor/contractor:

    Name of bank
    Address of bank
    Account name
    Account number
    ABA/Routing number

Invoices received for payment of services on a contract that has not been reviewed and approved by Legal Services will be held until approval for payment of such invoice has been received by the mission center officers.

4. Houses of Worship Revolving Fund Loan Application