August 2011, Sounds of Grace Commentary, Volume 27; No. 8
WRESTLING WITH THE CHURCH MORTGAGE
Can you believe it? Outreach Magazine selected Grace Community Church as one of the 100 fastest growing churches in America. Also, they chose Grace as one of six churches to be featured in an article. I emailed the writer of the article and shared with her that she needed to interview our volunteers, staff, and elders to get a good sense of what God was doing among us. She actually took me up on that! But I will be sharing my two cents in the article as well.
People are responding to the gospel and are being born again. Just a few weeks ago, I think it was 16 people who gave their lives to Jesus Christ in a worship weekend. On another note, I just got word that a marriage which was ending two years ago is now thriving to the point that marriage vows are being renewed this fall! The restoration of that marriage began when the husband was born again following one of our services.
It is breathtaking what God is doing. We are seeing our vision to reach Orange County and beyond for Jesus Christ slowly being realized. Unbelievably, our church still continues to grow, even during the summer (when church attendance dramatically falls due to vacations and the like)! Growing pains continue to be felt. But I wouldn’t want it any other way. We are in the middle of some renovations to make more space for offices and staff. We are trying to figure out how to fit more people in the Worship Center for services when the fall hits, and are considering an “overflow” space.
In light of this, multi-sites are on the table. Renovations in the Worship Center are hopefully about to begin. Shuttle buses to Grace from parking at another location are being considered. And round and round we go…
Likewise, we are at the same time fully engaged with how we might handle the church mortgage. I know this is of concern for some. As we speak of the future (i.e. multi-sites, missions, renovations), I figured some of you may have lurking questions about how we’re factoring in the church mortgage. I thought I would send use this month’s Sounds of Grace article to share with you the options we’re looking at. This will be addressed in the budget presentation material I will be sending out soon also.
Mortgage Payoff?
As we have been walking through the process of analyzing what our possible options are to keep following Christ in fulfilling the vision of the church, we have kept in mind the balloon payment on our mortgage loan. In 2004, the church borrowed $1.76M to build Graceland. The loan amortizes over 20 years, but has a 10-year balloon payment due in 2014.
I appreciated those who spoke passionately about their concerns regarding the mortgage at the business meeting. I didn’t communicate the seriousness and the amount of time that has been given to the retirement of the mortgage. For that, I apologize.
We have been making monthly principle and interest payments for seven years now, just like many of you do on your home mortgages, and we’ve reduced the loan balance by nearly $400,000 over that time. Sometime between now and 2014 when the balance of the mortgage is due, we’ll have to choose one of the three following options:
Raise the money to pay it off
Refinance it into a completely amortizing term
Refinance it with another balloon payment
Suppose we refinanced the loan with a 10-year fully amortizing term. That would increase the mortgage payment from the $12,990 per month which we currently pay, to $14,700 per month. If we roll the mortgage over to a fully amortizing loan this year, we will pay the mortgage off in 18 years, as contrasted to most homeowners who take 30-year loans. If we refinance with another balloon, we push the payment down the road, but have more cash flow for ministry. If we raise the money and pay it off, we risk that if the predicted inflation acceleration occurs we will have paid off the mortgage with the most expensive money. The great news is that we have the ability to service our loan and the banks are more than willing to work with us, even in the current economic environment.
I hope you find this helpful in bringing you up to date with where we are. Likewise, I hope it assures you that this is not off of our radar and is being taken seriously. I have expert elders and lay volunteers eyeballing this for us and giving direction.
Thanks for taking the time to read. May the Lord continue to move so powerfully as we seek Him so desperately!
In Christ’s joy,
Pastor Jarrod
Grace’s Financial Standing
YTD for July 2011-June 2012 Fiscal Year:
YTD Giving: $134,642.90
YTD Expenses: $90,911.20
YTD Cash Flow: 43,731.70
Monthly Giving–July 2011)
July Giving: $134,642.90
Designated to Building Fund: $13,243.89
Designated to Deacon’s Fund: $4,424.00
