Griffin’s Loans to Non-Profits
Griffin Capital Funding is known nationwide for making church loans. While making church loans is the concentration of our business, we do make loans to non-profits; for instance, organizations such as schools, trade organizations, and social advocacy groups.
Church Loans or Loans to Non-profits: Traditional Facts
Typically, traditional lenders do not favor making loans to churches or non-profits for several reasons:
- The specialized nature of the real estate and the difficulty in repurposing the property if necessary.
- The reputation risk of the lender, if they are forced to foreclose, lenders are concerned that their name will be in the newspaper showing that they are foreclosing on a church.
- The lack of strong guarantors to back up the loan in case something goes wrong.
Despite these factors what traditional lenders do not understand is that the default risk for churches is lower than many other asset classes that they do prefer. So, while the real estate may be less favorable, the risk to have to find a solution to a problem is less.
Griffin Capital Funding’s Loan Management
On average, Griffin Capital Funding closes over $100,000,000 per year in church loans and we have closed almost $1 Billion in loans for churches since our inception. Our mission is to provide products that help churches in all stages of their life cycle, from strong and growing to losing members and facing bankruptcy.
Our products are risk based, so those churches that are in great shape are going to get wonderful pricing and those that are in terrible trouble are going to pay more. We do not usually need personal guarantees for our non-profit or church loans and most of the time we can offer loan to values of 80% and sometimes more.
For example, for our latest non-profit closing, we provided a 7-year fixed rate at 3.5 %. We just helped a church in Denton, TX refinance their loan that was held at 7.2% . After making payments for 11 years and their principle balance reduction being minimal, the church re-evaluated and decided it was time to make a change. They are now saving $65.000 annually.
If your non-profit or church will need financing soon, please give us a call to see what program we may have for you: 800.710.6762. For more about our Loans, please visit.