Overview of Synod Loan Service
The Synod of the Pacific has an extended history, dating back to the 1950s, of lending to member churches, presbyteries, and constituent organizations within its bounds. The Synod’s current portfolio stands at roughly 24 million dollars. It has never had to foreclose on a borrower and has been repaid every dollar lent under the current loan program.
The Synod’s Loan Service provides much-needed funds for the site and church property purchases, first unit (sanctuary, Christian education, and offices) construction, expansion, renovation, and refinancing projects, manse purchases, and home-equity sharing arrangements. It also provides flexibility and an understanding of Presbyterian Church needs and operations that cannot typically be found with commercial lenders, in addition to attractive interest rates, and very low fees and expenses.
Because the Investment and Loan Services work together, it is known as the Synod Investment and Loan Service.
The net proceeds generated from the Investment and Loan Services are recycled back to member presbyteries as a portion of their Mission Partnership Fund allocations.
The liquidity of the Service is underwritten by a $5 Million Revolving Line of Credit with Umpqua Bank.
Synod of the Pacific offers several different loans options to meet the needs of potential borrowers:
- Line of Credit Loans provide funds for construction and renovation projects and other needs. Funds are drawn as needed, and only interest payments are required. The Interest rates are variable and subject to a Mission Giving discount of up to .75%. LOC loans are granted for a 2-year term, with renewal possible for an additional 2-year term.
- Amortized Loans provide funds for the site and building purchases, and are also used to refinance Line of Credit Loans after project completion, or to refinance commercial debt. Principal and interest payments are fixed for the 5-year term of the loan and are based on a 20 or 25-year amortization, with renewal applications due every 5-years. Interest rates are variable and subject to a Mission Giving discount of up to .75%.
- James M. Muzzy Loans provide capital funding for congregations with special financial needs, including small congregations, new church developments, racial/ethnic congregations, and churches with catastrophic uninsured losses. Fixed-rate loans, subject to Mission Giving discount, amounts of up to $250,000 are available for up to 20 or 25-years.
- James M. Muzzy Line of Credit provides a flexible line of credit for churches that meet the conditions of the Muzzy fund. Fixed loan rate, subject to a Mission Giving discount of up to .75%. Lines are granted for one year term, no renewal/extensions available.
- Low-Interest Green Loans provide low rate funding for congregations wishing to make environmentally-friendly improvements to their church facilities. Green loans may be used to upgrade outdated appliances and office equipment, convert to alternative energy sources, or for implementing energy conservation measures. The maximum amount for Green Loans is $300,000, to be repaid at 4.25% interest, amortized over 20-years. Loans $100,000 or less will be amortized over 10-years.
- Low-Interest Insurance Loans provide for risk mitigation improvements for church facilities, such as sprinkler or fire alarm installation, security and anti-vandalism measures, removal of hazardous materials, roof repairs, plumbing repairs to avert water damage, and repairs of all kind of hazards. Each year, the James M. Muzzy fund offers a limited number of loans of up to $50,000, for these purposes. The loans are repaid at 2.25% interest over 10-years.
- Equity Sharing Loans provide funds for churches wanting to participate in Equity Sharing Agreements with pastors. Loans of up to $125,000 for congregations of up to 250 members are made from the James M. Muzzy Fund. For larger congregations or loan amounts exceeding $125,000, Line of Credit or Amortized Loans can be used for this purpose.
Discounts of up to .75% off our usual lending rates are available for churches demonstrating an excellent history of supporting Presbyterian causes through General Mission Giving.
To apply for a Synod of the Pacific loan, complete the appropriate application or contact the Loan Coordinator for help. Loans must be approved by the congregation, the Presbytery, and the Synod.
The Synod takes great pride and care in managing this important program. We recognize that it is an integral part of the health and vitality of all churches within the boundaries of the Synod of the Pacific. If you would like more program information, please contact us:
Danielle McCarthy at (707) 765-1772 ext. 110 or at firstname.lastname@example.org