The Pastors and Trustees are recommending Venture approve an offer to refinance our current debt (required by our current loan agreement by July 1, 2014) and finance the construction of Phase 1A of The Hub. A resolution will be read in all three worship gatherings on March 30th and a vote will be made by the church on whether to accept or reject this offer. The following are the details on the offer:
- The maximum we are currently approved for is $2,160,000.
- This loan is a BOND issue and not a conventional loan. The bonds will be sold and managed by Share Financial Services in Dallas, TX. They are a well known reputable lender that exclusively finances projects for churches. Learn more about them at www.sharefinancial.com
- The repayment of the bonds is a fixed rate of 6.65% for 25 years. The anticipated maximum monthly payment is $14,925.
- There is a $79,800 underwriting fee. There will be an opportunity for members of Venture to buy and/or facilitate the sale of bonds. Those sold through us will not be subject to a 5% brokerage fee. Details on how this process will work will come later.
- No money is required from us as a down payment on this loan. There is upfront money involved in paying for the appraisal, audit and commencement fee (an upfront percentage of the Underwriting fee).
- There are no fees or penalties to refinance the loan or pay it off early.
- Everything is subject to an appraisal and other administrative processes.
The following are few other important pieces of information for you to consider:
- The Pastors and Trustees have no intention of leading this church to pay for this loan for 25 years. The Trustees are working to finalize a decision on a commercial real estate agency to attempt to sell the three lots on New Hope Road that we have sectioned off in our Master Plan to be sold. The Trustees are also researching the appropriate asking price so that we can get the maximum amount of money possible for those lots. The sale of these lots can be directly applied to our debt. In addition, as soon as there is enough equity in the property and/or cash on hand to do so, we will aggressively pursue efforts to refinance our debt to better terms.
- Since the spring of 2013 Venture has been aggressively pursuing financing from numerous institutions. We did receive other offers to finance Phase 1A of the Hub, however, every offer we received required us to raise large amounts of cash up front before the loan could be closed. At an approx. cost of $1,500 per week ($78,000 annually) to lease North Gaston High School, it is the opinion of the Pastors and Trustees that it is not financially sound or beneficial to the vision of this ministry to take the next few years to try and raise the kind of cash needed to get a conventional loan.
- The Trustees and Pastors have formulated a plan to immediately cut the expected increase from the mortgage payment out of our current budget so that in the end there is no increase to our overall annual budget. Either way these cuts were going to be necessary – either to make room for the mortgage payment to start the construction process now or to save up the needed money to eventually make a down payment on a conventional loan.
We apologize for the urgency, however, we have a deadline of July 1, 2014 to have our current loan refinanced, therefore, given this loan is our only reasonable option to move forward with Phase 1A we feel we need to expedite this vote. If you have questions please contact any pastors or trustee of Venture.
I’m pumped about the future and believe God is going to do great things through this!!
Let’s go man go!!!
Lead Pastor, Venture