By Darrel Rowland
We like to tell people that our brotherhood is among the fastest growing in America and contains far more than its share of megachurches.
But there’s a unique factor in how God has blessed the Christian churches/churches of Christ that often gets overlooked: a trio of loan funds that now have a combined $1 billion-plus in assets.
“I think it’s just a testament to our movement that it has three strong, vibrant funds,” said Doug Crozier, CEO of the Solomon Foundation and former head of the Church Development Fund (CDF). “As far as I know, there’s not another denomination in America that can say that.”
While the Lutheran Church (Missouri Synod) Extension Fund and the Assemblies of God loan fund (called AG Financial Solutions) both top the Restoration Movement’s joint total, they also have five or six times as many congregations, he said. So we are “light years ahead,” Crozier said. “That tells you what’s going on in our movement.”
Both the Church Development Fund, founded in 1953, and Solomon Foundation, begun in 2011, bankroll church loans nationwide. The third, Christian Financial Resources (CFR), launched in 1980, concentrates in the Southeast and Northeast.
Each has a slightly different emphasis and its own selling points. (A chart at the end of this article provides helpful information.)
CDF is easily the biggest—the third-largest extension fund in the U.S.—and President Dusty Rubeck says that means it can take on larger and more complex projects.
CDF occasionally goes beyond traditional Christian Church/Church of Christ organizations, making loans to “autonomous churches or parachurch ministries that exemplify characteristics of congregations and ministries that are identified with the Restoration Movement.”
Crozier says Solomon looks for churches with potential for rapid growth, most of which could never get a bank loan.
CEO Darren Key says CFR aims to have the lowest loan rates for churches. The average for existing loans is less than 5.5 percent, which he says may be the lowest in the history of the Christian church extension fund industry.
“What separates us at CFR is, every day when we get up, what we’re thinking about is how can we fund ministry to change lives,” Key said.
CFR, which had a record surplus last year, saved one large church $175,000 a year in interest, he said.
“We love saving the churches money,” Key said. “We think it’s important because we really want less money going to interest and more money going to ministry, more money going to missions, because we know those additional dollars, that’s going to impact a life.”
Thanks, in part, to the popularity and influence of financial guru Dave Ramsey, Key said at least one-third of CFR’s fund-raising campaigns are designed to reduce debt.
“A lot of people in our churches are really catching on to the idea of ‘let’s get out of debt,’” he said.
“We’ve never had to foreclose on a church; that obviously has been a huge blessing from God,” Key noted. “We have zero loans that are even one day late.”
Investors appreciate the fact that they’re not just earning interest; their money is being used “for kingdom purposes.”
“And that resonates so much with people. I’m finding that as I go out and speak [to] people . . . they want to make a difference. They want to invest in something that’s going to make a difference 1,000 years from now,” Key said.
Solomon may be less than four years old, but it already has made a mark.
Just establishing a new fund took a step of faith. “Nobody in the nation of any denomination has done this since 1994,” Crozier said.
Solomon took it as “a real God thing” when the IRS granted it permission to operate in just 63 days; the loan fund’s lawyer had predicted 18 months.
Within just 26 months, Solomon had grown to $100 million in assets. The previous record to that benchmark, Crozier said, was the Presbyterian Church USA—which took 16 years.
“Our growth has been unprecedented in our industry,” Crozier said. “Out of 45 funds in America, we reached $50 million and $100 million in total assets faster than any other denominational lender in American history.”
Solomon is now the country’s 15th-largest extension fund; last year it grew faster than the other 14 combined. Current projects include a church in Poland and a partnership with Southeast Christian Church in Parker, Colorado, to build a 60,000-square-foot office building that will be occupied by nonprofit entities.
Solomon has loans out to some of the most rapidly expanding congregations in the country, such as the 2|42 Community Church in Brighton, Michigan, tabbed America’s eighth-fastest-growing church by Outreach magazine. Weekend attendance easily averages more than 4,000, Crozier said.
“We’re kind of the catalyst that is helping those newer, dynamic, growing churches. That’s kind of our sweet spot,” he said.
Solomon found itself quickly specializing in “big-box” renovations. The 2|42 facility was converted from a 74,000-square-foot racquetball and tennis facility. An old Walmart now is the gathering place for Ridge Community Church near Milwaukee. A Gold’s Gym in Spokane became one of Real Life Ministries buildings, a shopping center in Moscow, Idaho, became another.
Solomon also is completing smaller building rehab projects for new churches such as Missio Dei in Salt Lake City.
“We’re buying those (buildings) at pennies on the dollar and converting them,” Crozier related.
For example, renovation was recently completed of an 85,000-square-foot former grocery store in Colorado Springs for Discovery Church. The structure was on the market for $8 million, but obtained for $2.4 million.
Crozier said Solomon has no delinquent loans or late pays.
“We underwrite leadership first. We want to know who our borrower is,” said Crozier, a former banker. “We don’t really care about the financial statements until we have cleared their leadership.”
CDF—Investing in Dreams
Church Development Fund is the acknowledged big kid on the block. Its reach extends far beyond its loans, especially through its partnership with Provision Ministry Group, which includes church-planting Stadia and church-staffing Slingshot Group, among others.
The fund also finances scholarships, leadership training, even eldership clinics.
“That’s not building a building someplace, that’s not making a loan, but that’s helping to make sure these churches are getting stronger in their leadership,” Rubeck said. “Certainly we loan money to build buildings, but really what we’re doing is investing in the dreams of ministry leaders.”
Many smaller funds, such as those at the state level, merged with CDF several years ago as an alternative to folding.
“I think certainly the stewardship responsibility we have is a weight that is very significant,” said Rubeck, who took the fund’s top job at the beginning of 2014 after serving as president of Dallas Christian College.
“We know we have a leadership role in the Christian church. Because of our size, we are able to do larger loans than the other funds can do, so we get involved in some of those larger, more complex transactions.”
Rubeck has conducted extensive research on how churches can avoid future financial trouble by examining those that experienced difficulty in the recent Great Recession.
He is trying to bolster the fund—as well as convince church leaders—because another recession could easily happen in a few years that might be even worse, since interest rates likely will be higher.
Rubeck sees “positives and negatives” with the fact the Restoration Movement has three loan funds, while organized denominations essentially are limited to one.
“I think at the moment we’re seeing some real inefficiencies in having three funds, but I’m the big guy, so of course I’m going to see it that way,” he said.
“All three funds have somewhat unique approaches to what they do and somewhat of a unique profile of whom they serve. And I think that’s really good. But we are not that big of a brotherhood, so there ends up being a little bit of overlap.”
With two or three organizations sometimes talking to the same churches and the same investors, “it can be confusing,” Rubeck said.
But at its best, “how this could work is that we could share the risk and we can share the work and share the resources,” he said. He notes Church Development Fund has partnered with Christian Financial Resources on a couple of church projects that were too big for that regional fund to handle alone.
“Every one of the funds will tell you it isn’t about buildings,” Rubeck said. “Buildings are tools. This is about growth in the kingdom of God.”
Darrel Rowland is an adult Bible fellowship teacher at Worthington (Ohio) Christian Church and public affairs editor of The Columbus Dispatch.