Loans - Rates and Terms
Loan Interest Rates & Maturity Limits
Collateral Requirements
Loan Interest Rates
Loans will be offered with periodic interest rate adjustments of one or three years at the option of the borrower without regard to the amortization and maturity term.
Interest bearing loans
- Interest bearing loans which are not supported by related investments (Loan Support Program) will carry the Church Extension's loan interest rate as defined in the then current loan rate schedule, provided a draw of at least 10% of the loan amount is made within sixty days of the commitment date. Otherwise, the loan interest rate will be that charged by Church Extension on new loan commitments as of the date funds are first advanced, but not more than 1% more or less than the approved loan interest rate.
- Interest bearing loans with supporting investments:
- Interest bearing loans with supporting investments will carry a "base interest rate" of Church Extension's then current loan interest rate.
- That portion of the loan balance that is supported by investments will carry an interest rate of 2% greater than the average rate paid on such investments, but not less than 6%.
- The loan interest rate will be recalculated quarterly, based upon the ratio of supporting investments to the loan balance.
- Interest bearing loans with supporting investments will carry a "base interest rate" of Church Extension's then current loan interest rate.
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Lines of credit
- The interest rate on lines of credit without supporting investments will be based upon the "prime" lending rate as printed in the Wall Street Journal and will be adjusted on a monthly basis.
- The interest rate on lines of credit with supporting investments may be a fixed rate in accordance with supporting investment policies.
Maturity Limits
Interest bearing
- Without supporting investments
- Lines of credit - one year
- All other loans - not to exceed the initial amortization term
- With supporting investments
- Lines of credit - term of investments, up to five years
- All other loans - not to exceed the initial amortization term
Interest free
Not to exceed the initial amortization term (Note: Interest free period is to be for a maximum period of five years, which is defined in the interest rate frequency of adjustment.)