Churches in Foreclosure

6/22/12
I recently came across an article by Hazel Trice Edney. The article by Mr. Edney is in the June 18, 2012 issue of Insight News. Edney interviewed Michael Grant who is the head of a national Black banker’s organization. Mr. Grant is sounding the alarm that banks are foreclosing on churches across the nation at an alarming rate. His primary concern is that church leadership is making decisions primarily on visionary plans and faith versus on sound business plans. He is encouraging all churches to “think of themselves as a business,” when it comes to finances.

I have to admit that I have had some of the same concerns for Christian based non-profits and churches. I worked in the non-Christian, non-profit sector long enough to get a glimpse into the financing practices for non-profits. Later in my life I became more aware of the Biblical teachings about finances and I have tried to reconcile my thoughts about the two. This article stating that some churches are engaging in some rather risky financial practices brought all of these thoughts to mind.

I believe there are successful ways to marry the Biblical principles for finances with the modern day world of finance. While world financial practices come in many shapes and forms there are reasonable, compatible business practices and financing practices available to Christian churches and non-profits. In all probability some churches have not thought of financing building projects and major outlays as business transactions, typical of other non-profits. They have viewed them through the lens of reaching out to the world with the gospel of Jesus Christ and supporting the church family. Perhaps, due to budget limitations some church bodies have not taken the steps they need to take when dealing with large sums of money.
Michael Grant lays out five basic patterns he has seen in churches that leave them vulnerable to foreclosures and to financial difficulties. These patterns are:
1. Expansion plans not directed by sound financial plans developed by someone with the expertise in finance necessary for long term success.
2. Frugal planning was not an inherent part of many plans he has seen. Nor has financial monitoring and accountability been at the levels necessary for major projects.
3. Record keeping that was not in sync with standard accounting practices.
4. Lending institutions not notified early enough in the process for loan modifications or forbearance.
5. Many churches believe that bank assistance is available AFTER foreclosure procedures are initiated.
(Insight News, June18 – June 24, 2012, pg. 13)

Out of these five patterns that can lead to problems, I believe they all can apply to all non-profits and churches. The first three patterns are patterns I have witnessed personally. Often organizations are running more on faith and vision than on sound financial planning and practices. Please, if you are involved with a church or a non-profit voice up and help your organization stay on top of their record keeping and accounting practices! Hire a person with expertise in finances if you need to when making building plans. Volunteers have a place and a sound, valuable purpose in Gods’ plans, however, sometimes you may need advice from a hired professional because there is no one truly qualified to be giving you advice. Sometimes, hiring an outsider also provides a needed voice of neutrality during the development of your financial plans. It can be difficult to join a vision and a God-given directive with financial plans. Hearing from all angles will only benefit the project in the end. Discernment is necessary in all phases of a major building project or program project.
Finally, I want to address the issue of loans. I have been learning that loans are not necessarily “evil” however as Christians we must remember Gods’ plan is to prosper us. Taking our loans is not a way to prosper but a route to survival. Funding plans before building may sound like a monumental task; however, it provides the clearest route to financial freedom for a church body. Paying for building as you go protects you from ever facing foreclosure. God will provide for you and your plans as He wills it. If your church is in debt as I personally am, there are routes to financial freedom available. Let us take the steps to redeem the past and to create a new plan for our future with our finances.
I still struggle with the idea of finding funding for large, multi-million dollar projects, but I have found people and ministries who are role models for me. Financial planning belongs in the church. Biblical financial planning belongs in the church. Sound accounting practices belong in the church and sound record-keeping is a foundational practice for a healthy organization. God is good. He can redeem past mistakes and clear a path to financial stability. I pray that all Christian organizations take a deep look at their “business” practices and keep their houses clean. I pray for our nation’s churches that have been ensnared by the enemy during these difficult economic times and call upon you to stand beside me in prayer that God can take what was planned for evil and turn it into good according to His plans. I pray God rescue His churches and set them on the path to financial stability through sound Biblical planning practices.