Church Mortgage Loans

Finding and purchasing the right new home for your church, temple, or faith community is a big undertaking. The feeling of the space needs to be right, and the costs can seem insurmountable for the right type of property in the right location.

Our team at Faith Based Funding helps congregations around the US to secure affordable church mortgages and church building loans. We work to bring these properties within reach for your church.

Church Mortgages in America

Church Mortgages

church mortgages

Church Mortgages

 Church properties often start in the millions. So how do congregations purchase them? The most common solution is a low interest, longterm church mortgage.

bridge options for church mortgages

Short Term Bridge

If you need to move quickly, a bridge loan might be the best option. This shortterm financing offersinterest only payments and can be funded in a week.

church building loans

Church Building Loans

Sometimes the best approach is to buy a lessthanperfect property and renovate it. Our church building loans can finance your purchase AND your improvements.

Overview of Church Mortgages

church mortgage loan for small church in AmericaIn many ways, the church building become the home for their congregations. The church or temple building becomes a symbol of the community’s commitment to growing together, providing the physical space for its members to gather.

But church properties often start in the millions. So how do congregations purchase them? There are a variety of different financing tools available, but the most common (and typically most cost effective) solution is a long-term church mortgage or church building loan.

A church mortgage — sometimes referred to as a church building loan — is a form of financing that helps organizations purchase their properties. It’s a mortgage with specific benefits and underwriting processes tailored to churches and places of worship.  Church mortgages typically offer many benefits for congregations, including:

  • Lower interest rates compared to other types of financing
  • Longer repayment terms than most standard loans (up to 30 years)
  • Flexible underwriting criteria
  • Financing up to 80% of the purchase price (and in some cases higher)

For churches looking to buy new property, obtain additional space or refinance existing debt, a church mortgage may be the best solution.

Should we rent or purchase our space?

church building loan decisions
As property costs have skyrocketed, it is becoming more common for churches to find themselves stuck paying rent in malls, theaters, office buildings, and even college campuses. In the long term, however, rent is money that is exiting the community, rather than money that is being invested to make the community stronger.

With the right funding model and strategy, congregations can invest in themselves by purchasing land and property that can be shaped to meet their mission. Then, as the church mortgage loan is paid off, the church building becomes an asset that can be used to secure a line of credit, or as the foundation upon which to fund other properties or even land development. Just as for individuals, over the long run owning your home – rather than renting it – is the less costly and more financially stable path.

church building loan comparison

Do we need a church mortgage for our building?

Faith communities have a number of ways to fund the acquisition of new building. The first is to raise the money to purchase the property outright. Within wealthy communities, or those that have an extended reach through television or online, that’s a possibility. But even these communities often fund at least a portion of their acquisition cost through a church mortgage loan so that they can use the rest of their capital for property improvements, mission work, and outreach to spread the message to even more people. If a faith community puts down 20 – 50% of the property value, it’s well on its way toward paying the property off, but it also sets a community capital fund goal that congregants can rally behind.

Utilizing a church mortgage also helps to preserve cash. If a community puts too much money into equity too quickly, it can feel the pinch on its operating budget. The leadership may have to take equity-based loans to free up some of that capital, which could unnecessarily increase the cost of money.  At Faith Based Funding, our church lending consultants help your team match with a lender who will provide loan terms that match your community’s vision.

Which types of church building loans are available?

church building loan and church mortgage solutions for American churchesThere are two main types of church building loans.

The most common financing is long-term or “permanent” financing. These loans are church mortgages secured by the property and are most closely akin to a home mortgage. Interest rates are low for this type of financing. The term, or length of the loan, is long. Monthly payments include principal, interest, and often an escrow payment toward taxes and insurance.

The second option is a bridge loan. This financing helps organizations acquire a property quickly, funding in as little as one week. Monthly payments are interest only, which keeps down costs. However, these are short-term solutions that last for only a few years. This is why they are referred to as a “bridge” – a temporary solution that spans the time between purchasing a property and refinancing the property using a permanent mortgage with a lower interest rate.

How do we qualify for a church mortgage?

church mortgage loan underwriting and qualification processQualification for permanent financing, or church mortgages, is heavily based on your community’s cash flow. Donations, book sales, and even retreat or workshop receipts all count towards cash flow. The higher and more consistent your cash flow, the better.

Another way to qualify for a church building loan is to leverage existing assets. If your faith community owns additional properties, a printing center, a community kitchen, or a residence for the pastor, these are assets that can back a faith-based property loan.

Bridge loans, however, don’t rely on your community’s financial statements in the same way. Rather than looking at your history of donations, revenue, and costs, bridge financing instead focuses on the value of the property itself. The amount of available funding will be determined almost exclusively by the appraised value of the property. This often makes bridge financing an ideal solution for new communities without a long financial track record.  Our consultants will help you evaluate the pros and cons to find the best solution.

apply for a church loan

Step 1: Apply

Apply in under 3 minutes.

connect with church funding specialists

Step 2: Connect

Consultants explain all options.

funding for church loans for small churches

Step 3: Get Funding

Select the best fit and get funded.

What are the rates & terms?

Church mortgages, or permanent financing, has long terms and low interest rates. This is a 10-30 year loan and interest rates start at 4%.  Similar to a home mortgage, rates may be fixed, meaning the faith-based community pays a set monthly amount with a fixed percentage going toward interest each month. Or, rates may be variable, meaning that after a certain date the interest rate may change based on the prime rate set by the federal reserve. With a variable rate, the monthly interest payment will change each month, which means the faith community has to be able to adjust payments over time.

A bridge loan, on the other hand, is a short-term financing option with a maximum timeline of three to five years. Payments are interest only but carry higher interest, starting at 8%.

To find out what your faith community is able to fund, talk with a Faith Based Lending Agent today.


What types of properties can be financed with a church mortgage?

Most types of real estate can be financed through a church mortgage.  Churches, temples, mosques, and even retreat centers will qualify.

In addition, other property types can be repurposed to serve as a home for a congregation.  Theaters – both cinema and stage – are common candidates.  Commercial retail buildings, as well as warehouses and industrial space, have all been remodeled to serve as vibrant churches.

In addition, many faith communities focus on more than providing a sanctuary. They put faith into action through a full-service community center, daycare, school, kitchen, or even gardens – all secured by church building loans. Other faith communities provide spiritual sanctuary through retreat centers and gardens.  

All of these properties can be financed by our team at Faith Based Funding.

How do we secure a low interest church building loan?

Interest rates are determined by a combination of factors including the FED rate, the length of the loan and the risk to the lender. Our team works with each faith community to find the right church building loan with terms and rates to fulfill your mission.

That can mean focusing on a low monthly payment, a lower cost of capital, or even a shorter or longer repayment period. We have developed a vast network of faith friendly lenders who are interested in seeing congregations stabilize, grow and thrive.

Is real estate a good investment for a church?

Real estate provides a variety of risks and benefits. Most importantly, purchasing property adds stability to a faith community. The property builds equity as loans are repaid. Property may appreciate over time, and the church can draw on equity for working capital to even out the flow of donations.

However, once a faith community purchases a property they become responsible for its management, maintenance and upkeep, each of which brings ongoing costs. Those costs are typically less than paying rent, but they do need to be accounted for within your ongoing budget.

What are the other alternatives to church mortgages?

Church mortgages are not the only option available when it comes to financing for a church.

Other viable alternatives include taking out a church construction loan if the congregation is looking to build a new facility, or going with church renovation financing if an existing building needs remodeling.

Church equipment financing can be used to purchase items like audio-visual technology, community kitchens,  or even playgrounds. Additionally, church vehicle financing is available if the congregation requires buses or vans for transportation.  Alternatively, a church line of credit can provide a financial safety net for your congregation, or serve to support onling ministries.

At Faith Based Funding, our experienced team of church lenders will take the time to understand your specific needs and help you make an informed decision on which type of finance is best suited for your congregation. Our friendly and knowledgeable advisors will provide advice on each available option and guide you through the process of selecting the most cost-efficient solution that will help propel your church’s growth and success.

Church Loans Made Simple
apply for church funding and church mortgage refinancing

1. Apply

Start with an online application in just 3 minutes.

connect with consultants in church funding

2. Connect

Consultants help you evaluate financing options.

church funding for church equipment and church vehicle

3. Funding

Funds are deposited directly into church account.

Let's start.