 |
Frequently
Asked Questions |
|
Your Church is growing, you need financial assistance, you have
questions, and you're in search of answers...
Questions:
01. Why do Churches issue bonds?
02. Which Church denominations
issue bonds?
03. What criteria are used in
approving Church financing?
04. How does a Church repay interest
and principal on its bond issue?
05. Are Church bonds safe investments?
06. What are First Mortgage Church
Bonds?
07. In what amounts can Church
bonds be purchased?
08. Will the interest income
vary in amount?
09. How do interest yields on
Church bonds compare with yields offered on other types of investments?
10. How long can money be invested
in a Church bond?
11. When is the amount invested
paid back to the bondholders?
12. Do investors pay a commission
when purchasing a Church bond?
13. Are Church bonds a marketable
investment?
14. What is a book entry bond?
15. What happens when bonds
mature or are called?
16. Where can bonds be purchased?
Answers:
01. Why do Churches issue bonds?
Churches issue bonds for various reasons such as: financing new
construction, expanding existing facilities, refinancing an existing
debt, or for major capital purchases. Long term financing can provide
your Church with fixed payments protected from unstable market conditions.
02. Which Church denominations issue bonds?
All denominations issue bonds; however, Great Nation only serves
Churches dedicated to strengthening the moral foundation of America
and promoting Christian spiritual principles. Once this is established,
the Church's quality of credit determines which loans are selected
for underwriting and offered to investors.
03. What criteria are used in approving
Church financing?
Through years of experience, Great Nation has developed conservative
criteria for sound Church financing such as: minimum per-member
giving ratios, past history of growth, and favorable percentage
of Church equity to proposed debt. Great Nation also utilizes a
state-of-the-art computer system to calculate and analyze various
financial ratios and cash flows to achieve an accurate picture of
your Church's financial health.
04. How does a Church repay interest and
principal on its bond
issue?
Churches deposit a portion of it's weekly or monthly income into
a sinking fund account at the paying agent bank to ensure orderly
payment of interest and principal to bondholders. Churches agree
in advance that payment will be made before other operating expenses
are paid.
05. Are Church bonds safe investments?
Great Nation has underwritten hundreds of issues over the years
and boasts an outstanding record; however, no one can guarantee
the safety of any investment. Careful selection of issues, "tried
and tested" financing principles and sound underwriting are
just a few of thereasons behind Great Nation's remarkable reputation.
06. What are First Mortgage Church Bonds?
First Mortgage Church Bonds constitute a promise to pay principal
and interest and are secured by a first mortgage lien on the property
of the issuing Church.
07. In what amounts can Church bonds be
purchased?
Bonds are normally available in multiples of $1,000 in fully registered
form; however, Great Nation offers $250, or multiples thereof, for
IRAs or custodial accounts.
08. Will the interest income vary in amount?
Interest rate on the specific bond you purchase is fixed. Interest
on simple interest bonds is payable either quarterly or semi-annually
depending on the Issuer until your bond matures. Interest on compound
interest bonds is payable at the time your bond matures.
09. How do interest yields on Church bonds
compare with yields
offered on other types of investments?
Generally speaking, Church bond interest yields are higher than
yields offered on other corporate bonds or returns offered on savings
instruments.
10. How long can money be invested in
a Church bond?
Most Church bond issues are set up with serial maturities. In
a serial maturity, the issuer designs principal repayment so that
each bond matures on a specific date over a period of years until
the entire balance has been repaid. With Great Nation, investors
have the option to choose a maturity from 1 to 15 or 20 years.
11. When is the amount invested paid back
to the bondholders?
Usually the amount invested is paid back to the bondholder at the
stated maturity date however, the bond may be called by the issuer
prior to the maturity date, at which time the owner receives the
entire principal amount originally invested plus interest up to
the call date.
12. Do investors pay a commission when
purchasing a Church
bond?
The investor pays no commission in the purchase of Church bonds.
Great Nation is compensated by the Church issuing the bonds.
13. Are Church bonds a marketable investment?
Neither the Church nor the trustee is under obligation to pay funds
before the stated maturity date; however, for a standard 5 percent
brokerage commission, Great Nation will assist in selling your bond.
14. What is a book entry bond?
Most bonds are purchased as "book entry" to relieve bondholders
from the responsibility of holding a bond certificate. Interest
payments and principal payments are automatically sent to the bondholder.
Although a certificate may be obtained, Great Nation highly recommends
purchasing bonds in book entry form.
15. What happens when bonds mature or
are called?
At maturity, "book entry" bonds will automatically be
paid to the bondholder. "Certificate" bonds must be mailed
to the trustee bank. At that time, the trustee bank will remit a
check for the amount of the bonds plus any interest due. The trustee
bank notifies registered bondholders if their bonds are called.
16. Where can bonds be purchased?
A. Church bonds underwritten by Great Nation can be purchased from
any Great Nation registered representative. By simply calling 1-800-468-3007,
we will put you in touch with a Great Nation professional ready
to assist you with your investment decisions.
Get
Started Now!
If you have questions at any time, please don't
hesitate to contact us at:
GREAT NATION INVESTMENT
CORPORATION
Attn: Martin Northern Vice President and
Branch Manager
P. O. Box 1302
Benton, AR 72018-1302
Phone: (501) 316-3100 * (800) 468-3007
Fax: (501) 316-3110
Email: martin@martinnorthern.com
Great Nation is right for you! Our
professionals are standing by ready to serve. Meanwhile, we look
forward to becoming your financial partner in growing God's Kingdom…one
Church at a time…
|
