Many Lenders are foreclosing on church buildings across America in increasing numbers as banks lose patience with religious establishments that have stopped sending their loans.
The surge in
church Mortgage foreclosures provides a unique wave of distressed property
seizures prompted by the 2008 financial crash, with many
banking institutions no longer inclined to grant distressed religious
Ever since 2010, 270 church buildings have been sold after defaulting on their
commercial loan, with the majority of those sales happened
after a lender triggered foreclosure.
number of churches were sold by lenders in 2011, as 138
churches were sold, with no indication that these religious
foreclosures are slowing. Considering just 24 church sales
in 2008 and only a small number in the 10 years before.
The church foreclosures have affected all denominations throughout
America, but with smaller to medium size churches the
worst hit. The majority of of these institutions have
ended up being sold to other churches.
percentage have taken place in some of the states hardest struck by the home
foreclosure catastrophe: California, Florida. Michigan and Georgia..
Church foreclosures are different from house foreclosures. Most of the mortgages in question are not the typical 30 year
mortgages but rather commercial loans which typically mature after five years
when the full balance becomes due immediately.
typical practice for lenders to refinance such commercial loans when they come
due. But lenders have become more and more reluctant to do
that because of demand from bureaucrats to clean up their balance
The reasons leading to the boom in church
foreclosures will sound familiar to millions of foreclosed homeowners forced out
from their houses in recent years. During the great real
estate boom, many churches took extra loans to refurbish
or enlarge, often with major lenders.
With the economy went tumbling down, millions
lost their jobs, donations plunged, and so did the appraise value of the church building.