Churches Can Escape Taxes but Not Foreclosures March 12, 2012

Churches Can Escape Taxes but Not Foreclosures

One of the problems with churches is that they get away with paying no taxes despite taking in buttloads of cash every week. With megachurches, it’s especially egregious.

Before the economy tanked, many congregations bought new buildings to hosue them. They took out loans on the churches, confident they could pay the banks back. Now, with less money coming in each week, some of those churches are defaulting on their mortgage and banks dont want to refinance; they want the money or the property.

Since 2010, 270 churches have been sold after defaulting on their loans, with 90 percent of those sales coming after a lender-triggered foreclosure, according to the real estate information company CoStar Group.

In 2011, 138 churches were sold by banks, an annual record, with no sign that these religious foreclosures are abating, according to CoStar…

“Churches are among the final institutions to get foreclosed upon because banks have not wanted to look like they are being heavy handed with the churches,” said Scott Rolfs, managing director of Religious and Education finance at the investment bank Ziegler.

“And some pastors have not notified their congregants,” [Axel] Adams said. “They are fearful that if they do, they will lose congregants prematurely.”

That last line is especially sickening. It’s more important to these pastors to milk their congregations for all they’re worth instead of being up front and honest with them.

How bad is your business model when you can’t make your mortgage payments despite not having to pay taxes and getting a virtually guaranteed 10% of your congregation’s income each week?

Here’s an idea. Don’t expand if you can’t pay for it. If your income projections had to change because of the economy, don’t complain when you get treated the same way everyone else does.

You can try praying if that makes you feel better, but God’s not going to bail you out.

(Thanks to James for the link!)

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What Are Your Thoughts?leave a comment
  • If your reaction to your church being in trouble is to keep it secret and hope it works out instead of calling together the whole congregation for prayer

    Do you even actually believe in prayer

  • Melissa – I’m gonna make a guess and say that the friendly atheist does not believe in prayer. 

  • Anonymous

    To be fair, not everyone relies in compulsory 10% tithing. Most just have the collection plate go around

  • I don’t think Melissa was targeting the friendly atheist. hehe

  • Imagine if they had to pay a fair share of tax!

  • Anon

    I have a sudden desire to move to America and buy a foreclosed on church and then live in it.

    Although I’m certainly no fan of the religion I have to admit the archetecture is pretty.

  • Anonymous

    Well, some of it. The older ones, mostly; but I suspect most of the ones going broke are garishly-adorned big-boxes that went up in the last few years. Might work if you’re going to put in a car dealership, but not much else.

  • How long before some clueless legislator introduces a bill to help the churches refinance at a lower rate–because churches, unlike individual homeowners, deserve public assistance?

  •  Wow, whooooooosh.

  • Anonymous

     Putting something like a strip club or a sex shop in a church might be nice

  • Anonymous

    I’d like to purchase a church, call together all the local theists for a prayer gathering, set the church on fire (the church I own, and after receiving all the proper permits and such) and ask them to pray for Jebus to not let it burn.

    And have marshmallows followed by a science lesson.

  • A bunch of old churches in my neighborhood have been abandoned or turned into homes (pointy steeple and all). Apparently, Massachusetts doesn’t need a church every couple hundred yards any more.

  • … getting a virtually guaranteed 10% of your congregation’s income each week?

    To be fair, most Christians don’t tithe.

  • Nazani14

    The energy bills are generally hellish, even if the ceilings aren’t particularly high.  In some cases there’s no feasible way to add insulation.  I checked out a few because I think the wooden floors and large empty spaces would covert well to a dance studio.

  • Anonymous

     I was actually looking to see if this had been posted- The only church I’ve EVER been to that really emphasized tithing was some snake-oil non-denominational christian church in Okinawa I went to a few times.  They were very helpful in making me lose that faith 😉

  • Xeon2000

    They make for really cool dance clubs.

  •  I grew up christian thinking that tithing (and latin mass) only happened in the dark ages along with the sale of indulgences.

  • Anonymous-Sam

     It was either Friendly Atheist or Unreasonable Faith who linked an article on people doing this…

  • “Don’t expand if you can’t pay for it.”

    But what are all the kids graduating from religious studies at Bible School going to do with their lives?

  • Anonymous

    Or how about a bar or strip joint?

  • Guest

    That book store looks terrific.

  • Guest

    The big creepy megachurches seem to be heavier on tithing or at least nagging followers to donate, and they’re still doing okay. There’s probably a correlation there.

  • Georgina

     Wow – and I thought America was ‘more Christian’ than Europe.

    In central Europe the churches tithe – in fact the government tithes for them. This is one of the reasons the RC church makes it so hard to leave; no more taking it out of your wages before they are paid to you!

    I must admit it is not 10% (mandatory insurance is!), and how much depends on your particular branch of protestantism/catholicism.
    I believe it varies between 2% and 4%.

    The JWs do tithe at 10%, but this is paid from wages received and not deducted at source.

  • Anonymous

    In countries where the government collects church tax, you can easily avoid that by going to some government office. You don’t have to defect from the church.

    You’re officially religion-less then, and I you might not be able to get married in church anymore, but the church will still you consider you baptized

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