Church Loans

Should We Refinance Our Church Loan?

It seems everywhere you turn today, people are talking about refinancing. Interest rates are at historic lows, and individuals and business are scrambling to see if their interest rate is as good as it can be—or if there is something better out there.

But with all the talk and promotions flying across your TV screen, into your Inbox or through your car radio, how do you know if refinancing is the right decision for your church or ministry?

As you research church loan refinancing options, here are a few things to consider.

1. If you locked in your interest rate many years ago, it’s worth your time to see if you can find a better rate. Rates have generally fallen over the last several years, so chances are you can find a better rate (although terms and conditions may vary).

2. If you find an institution with a lower rate, make sure you understand how the refinancing process works and how much they charge in closing costs. Sometimes the savings you receive from a lower interest rate are wiped out by the refinancing closing costs.

For example, if you have seven years left on your loan, but it will take eight years to recoup the closing costs on your refinancing, then refinancing might not be your best option.

3. Are you confident the institution that holds your loan is your best partner? Church loans are different from home mortgages or a loan for a multinational corporation’s headquarters.

In addition, is the institution service-oriented; are they available to answer questions during the life of your loan; are they flexible; are they experts in the field; etc.?

These are just a few things to consider as you determine if refinancing your church loan is the right step for you.

We’d be happy to run the numbers for you!

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