Church Construction: Where Do I Begin?

Category | Construction

Who do I call first—the bank, architect, or builder? This is a common question churches ask at the beginning of a building project, and it’s easy to see why. To approve a loan, banks want to know the project’s cost, but to get the cost from a builder you need a design, and to get a design you need an architect, and to pay an architect, you need money from the bank.

So who do you call first? And does it matter which builder, architect, or bank you call?

Yes – it matters a lot and can make a huge difference in the outcome of your project and the effectiveness of your ministry. Here are my recommendations for a smooth process and the right way to approach a potential project.

Prior to making any calls, first reflect on the purpose of your project and the core needs of your ministry. Ministry need should always drive the project. Be sure to consider your project with the vision of your ministry and current resources in mind. Doing this will help ensure your project fits within your current financial parameters and meets both current and future needs. Once you’ve clearly identified your core needs, it’s time to pick up the phone.

Trusted Sources for Lending and Building

I recommend starting with a church lender. They understand church finances, budgets, and ministry at large. Your first call with them should help you quantify your available resources, and if a loan is the right option for you, to understand the underwriting standards and documentation you’ll need to provide for loan qualification. Most lenders ask for the last three years of financial statements and a current year-to-date financial statement, as well as an idea of your property’s current market value.

A good lender can also work with you to identify your financial resources—what you can afford. This is determined by evaluating three items: cash on-hand, fundraising potential, and borrowing capacity.

Your cash on-hand is the money you’ve set aside for the project. Make a clear distinction between this money and cash for operating and emergencies. Do not deplete your operating cash to build, as this could cripple your ministry.

Your fundraising potential is the amount you could raise from your congregation and ministry partners to help fund the project through a capital stewardship campaign. The lender or a stewardship campaign consultant can help assess this potential and determine realistic goals.

Your borrowing capacity is your debt capacity in light of your ministries, missions giving, salaries, and other expenses. Think of this amount as your borrowing boundary—not as the final amount you should borrow.

These three items combined will give you a benchmark for the possible scale of your project.

Keep in mind, banks and other lending institutions tend to identify all your income as a potential debt repayment source. This is dangerous, as it could compromise your financial commitment to ministry. A good church lender will not simply talk about how much you can borrow but how much you should borrow, as well as other options you may have. In other words, they will discuss a financing strategy rather than just a loan. This may include a capital stewardship campaign to help capitalize the project, minimize the loan, and involve your congregation. 

After clearly identifying your ministry needs and financial resources with the help of a church lender, you have a framework within which to approach design and/or construction professionals and discuss a project that is not only what you want and need, but also what you can realistically afford.

Some firms specialize in church design, construction, or both! Seek out partners that are experienced at assisting churches in design and pre-construction within the context of the church’s needs and budget, and those which seem to have your church’s best interest in mind. There are many specialized church design-build firms around the country. The right partners will use the ministry needs and resources you’ve identified to determine a project scope that is right for your church.

Team Approach

Some of the best advice I can give is this: Let your designer, builder, and lender serve you as a cooperative team. Rather than having a designer, builder, and bank perform separate services that bring unnecessary complications and confusion, engage them all to work as a team on your church’s behalf.

Partnering with church design, construction, and financing experts helps ensure a smooth project start to finish. You’ll be better able to accomplish your ministry expansion goals within your resources. Make their team part of your team, keeping God’s vision for your ministry at the center. He will guide and direct.

For more information on how to plan a successful church construction project, call 888.829.6877 or email

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