Church Lines of Credit

A church line of credit is designed to provide a congregation with a cash buffer or safety net. It allows your community to flexibly adapt to the ebb and flow of both donations and costs.

A line of credit for churches can also expand the impact of a ministry.  Many times a community event will create additional donations in the longterm, but entails upfront cost to plan and deliver.  Credit lines allow your congregation to  smoothly bridge these gaps.

church line of credit

Church Line of Credit Uses

church line of credit

Balance Cash Flow

A church line of credit can help even out fluctuations in donations and costs by providing a flexible cash reserve.

church line of credit

Mission Work

Funds can be used for mission work, community outreach, or new projects that your congregation is launching.

line of credit for churches

Inventory & Supplies

Ordering products and supplies in bulk can cut per unit costs. Church credit lines cover this and can save you money. 

church credit line coverage

What does a church credit line cover?

Operating funds refer to the cash that churches and faith-based communities use to fund their everyday operations.

A credit line for a church is a type of church financing that can be used to cover the costs for these same everyday operations. The funds can be used for payroll and salaries, inventory and supplies, equipment and utilities, vehicles and gasoline, marketing and outreach, missions work, and anything else that is part of achieving the organization’s reason for being. It is HIGHLY flexible financing!

How does a church credit line work?

church credit line options and uses

Church lines of credit are a popular option for because they are revolving loans.  This type of loan allows the church to draw from the line of credit up to an established limit, and then repay the amount borrowed, plus interest, over time.

To understand what makes this unique, consider a traditional term loan. Unlike a church line of credit, a traditional term loan requires the borrower to take out the entire lump sum at once. This amount is then paid off in full over an agreed-upon period of time, with interest.

Unlike a traditional term loan, a church line of credit allows the congregation to draw down as much or as little money as they need from the available balance.  As payments are made on the loan, those funds become available for future use. Best of all, the church only pays interest on the funds that are actually used. This can help to reduce overall costs and keep interest from accruing on idle cash.

what can church credit lines be used for

Should our church have a credit line?

Simply put, we believe that if you don’t need financing, then you should not get it. Many churches have plenty of donations coming in to cover all of their programs and operational costs. If you cannot clearly show that financing will help you to better achieve your mission, then it should be avoided.

However, if there is uncertainty about temporary fluxuations in the finances of your congregation, a church credit line can provide a safety net. This type of financing can provide access to funds during times when donations are down, or when emergencies arise.

For example, if your church needs a new roof and the cost will exceed what is currently available in the budget, a credit line could be used to cover the additional expenses without having to dip into savings.  And as you only pay interest when you withdraw funds, a church credit line can be a very affordable safety net.

How do we qualify for a church credit line?

mission work with line of credit for church
Underwriting a church line of credit requires a detailed financial review, including church financials for recent years. This is similar to the underwriting documentation process for any term loan, and our team will walk you through step by step.

Most importantly, your church should demonstrate a history of responsible management of its funds and be able to show that it is in a stable financial position going forward. Additionally, the church leadership will need to have a track record of upstanding fiscal management.

The best way to see if your congregation qualifies for funding is to schedule a consultation. Our team works with you to understand your organization, your goals, and the path to funding.

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What are the rates & terms?

Rates and terms for church credit lines vary based on the financing amount and congregation details.  Most often rates start at 5% and terms range from 1 – 5 years in length. 


What are the benefits of having a church line of credit?

Having a church line of credit provides your church with flexible access to funds when you need them, while eliminating interest fees when you don’t need to use the funds.

This financing is highly flexible and could be used for unexpected expenses, purchasing new equipment or supplies, offsetting cash flow problems, or even making payroll.

It provides peace of mind knowing that money is available when you need it. Additionally, it avoids the higher costs of other loans. Since you pay interest only when you withdraw funds, holding a credit line can provide safety for your flock without costing any monthly fees.

How long does it take to get approved for a church line of credit?
The length of time it takes to get approved for a church line of credit depends largely on how quickly you can provide all necessary documents and information. This may include financial statements and organizational paperwork proving your eligibility status, as well as other documents showing your ability to repay the loan taken out against your allotted maximum limit if needed down the road. If you have the documents already available, the process can be as fast as 1 – 2 weeks.
Is there a minimum amount required for a church line of credit?
The minimum amount required for a church line of credit will depend on each lender’s requirements but typically starts at around $25,000 or more. Higher amounts may require additional documentation and verification processes in order to assess the risk involved in approving the loan request. Our specialists will help you evaluate options specific to your congregation.
Are there any fees associated a church line of credit?
Yes – there may be various fees associated when attempting to get approved for or maintaining your current line. Depending on the scenario, this make include origination fees, annual maintenance fees, and interest on the amount you withdraw.

Lines of credit, however, are typically much more affordable financial tools than other loans. Unlike term loans, they do not require large upfront payments, and the interest rate often remains constant throughout the life of the loan. Additionally, with a line of credit, churches have greater control over their finances as it allows them to borrow only what they need at any given time. Most importantly, interest is paid ONLY on the portion of the line your church is currently using. If your church doesn’t need to use the safety net for a year or two, then NO INTEREST IS PAID during this time.

Are there any alternatives to a church line of credit?

Absolutely!  While a credit line is the most flexible and lowest cost financial safety net for a church, it is NOT a one size fits all solution.  Depending on your needs, a line might be a horrible fit for your church.

For example, if you are looking to finance your property then a line of credit will likely have too short of a term.  Our specialists at Faith Based Funding would instead recommend a church mortgage.  Or if you have a mortgage with a balloon payment coming due, then loans designed for refinancing a church mortgage would be a better fit.   

If your congregation is looking to build a new property, then you should explore church construction loans.  Or, if you have a building with solid bones but a dated interior, then you might get the lowest cost and best terms with church renovation financing.  

Or maybe you are looking to update equipment for your organization.  For playgrounds or audio visual equipment you’d want church equipment financing, but for cars, vans and buses you’d want church vehicle financing.

At Faith Based Funding, we don’t take a one size fits all approach to financing churches. As full service church lenders, our team is always looking for the best terms and lowest rates given each congregation’s needs.


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3. Funding

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