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Home > Building Finance Assistance > Advice on Loan Payment Issues
Advice on Loan Payment Problems
Catholic Finance Corporation is available to help you prepare for a discussion with your banker if you realize that a late payment on a loan is a possibility. It will be critical that you contact your creditor immediately because early notification may give you more financial options. Their first questions will be: What is the root cause? Are expenses not being tightly reigned in? Are revenues down? Are you overburdened by indebtedness? Has there been a recent change in pastoral leadership or administration? Bankers will also look for an assurance that if you do restructure the loan, the problem will be resolved.
Options to consider for negotiation include a reduction in the interest rate, a graduated interest rate, or restructuring of principal payments, among others. The situation is most difficult when parishes wait too long to notify the bank, especially if the loan goes into default. Default eliminates many of the options that might have been available to you at an earlier stage of distress. However, bankers don't want to foreclose on a church, so it pays to work with them and come up with a mutual solution. Also communicate the problem to your parishioners and enlist their support. Let us help you explore the options and develop strategies for recovering your financial health.
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