Mid Councils play a key role in our lending process. Presbyteries are required by our Book of Order to authorize any encumbrance of church property. We consider the process of church borrowing as a partnership between the Church, the Presbytery, and PILP. Loan discussions are most effective when approached as a process of self-discovery where all parties explore the strengths and potential challenges of a loan.
For years, PILP has been helping churches evaluate their capacity to fund projects. Building on this experience, we have developed a guide for presbytery committees to use when evaluating church requests to borrow money. Though not intended to provide a complete underwriting of the loan, this process examines key components for a successful project, including:
Debt per giving unit – is this a large loan?
Cash flow coverage – can the church handle the payments?
% of revenue going to debt – will it impact the congregation’s ability to continue their mission and ministry?
To download the Loan Discussion Quicksheet for Presbyteries, click here.
