loans to fund the future of faith communities
Since 1992, the Foundation has provided term loans to help churches and agencies finance their missional dreams. From new construction, to retrofitting worship space for outreach, to capital improvements like paving parking lots, repairing roofs, and replacing HVAC systems, the Foundation offers a low-hassle, below-market funding option.
In 2019, in response to the needs of communities we serve, the Foundation began offering bridge loans for special projects like solar panels and pre-development for affordable housing.
The money that we loan to churches comes from investments in our Stable Value Portfolio. Unlike a bank loan where the interest lines the pockets of executives and shareholders, every penny churches pay us in interest directly benefits other congregations who have invested their rainy day funds with us. It's a cycle of giving and receiving that supports local ministry here in the Northwest, today and for the future.
Is My Church Eligible?
We make term and bridge loans to faith communities in Alaska, Idaho, Oregon, and Washington. Although Faith Foundation Northwest has deep roots in the United Methodist tradition, congregations do not have to be United Methodist to qualify for a loan. Eligibility depends on the financial details of your project and your church’s repayment ability. Reach out if you’re considering us as a lender. We’ll work with you to determine whether you meet our program’s requirements, and if you do, we’ll send you the application that best fits your project.
How much can we borrow?
That depends on your project. For term loans, we use the 30/30 rule. For bridge loans, we’re more focused on the loan-to-value ratio. As of late 2023, the Foundation is able to independently make loans up to $800K. If you need a bigger loan, we have several other lenders ready to participate and help us make your loan happen— so don’t be shy about asking!
how long can we borrow it for?
Loan amortization depends on several factors including the size of loan and the church's/agency's ability to service the debt. Currently, the longest term available is 15 years.
How much interest do you charge?
Interest rates are set below WSJ Prime for term loans, and a little above for bridge loans. Rates are fixed for four years and then reviewed each following fourth year. Adjustments, both up and down, can be made upon each four-year anniversary of the loan.
What Are the Fees?
We don’t charge any fees unless our underwriting requires site visits. The cost of title insurance is added to the loan principal. In the case of a large and/or complex loan, the cost of legal counsel is also added to the loan principal. But there are NEVER penalties for early repayment— we REJOICE with your congregation as you pay down your debt!
Are Loans Secured?
Yes, a Deed of Trust recorded in first position is required for all loans.
How Do We Apply?
Please reach out as soon as possible if you’re considering us as a lender. We’ll work with you to determine whether you meet our program’s requirements, and if you do, we’ll send you the application that best fits your project.
What’s the timeline?
After we receive a complete application, our loan committee is usually able to make a decision within several weeks. After that, we order a title report and originate the legal documents. If the loan is small and the title report is clear, things progress quickly. If the title report comes back with exceptions and/or the loan is large, we may seek legal counsel, and that can slow things down. Once all parties are comfortable with the documents, it’s up to the church trustees to work with the title company to sign, notarize, and record them. As soon as they’re recorded, you can request your first draw. We disburse funds by direct deposit. Payments begin the first day of the second month following distribution of funds, and are made via ACH through our secure portal.