FAQs & Glossary

It can be difficult to get an "apples to apples" comparison since lenders' terms and conditions vary widely.

Thrivent will gladly work with your institution to help evaluate your choices. Our goal is to help you and your congregation find the loan that best suits your needs. Ask the following:

• What is the term of the loan (the date the loan matures, not the length of the amortization)? Few lenders offer a term longer than seven years and may charge additional fees to renew the loan.
• How long is the initial interest rate fixed? What are the terms of the rate reset?
• What are the initial fees? Are there additional fees during the life of the loan if changes are made?
• Are there covenants to comply with through the life of the loan?
• Are there prepayment penalties?
• Will there be a "balloon" payment?

You may make payments in addition to the required monthly payments, without penalty at any time, provided the funds did not originate from another lender. Prepayments will be applied immediately to the principal balance of the loan. A prepayment penalty may apply when funds originated from other lenders and/or any other external sources.

If at any time you wish to send additional funds toward your church loan principal, please print out a principal-only coupon (PDF) and indicate the church name, address, loan number and dollar amount on the coupon in the spaces provided. Please be sure to add your loan number and instructions in the memo field on the check as well (example: 200012340 Principal Only). Then submit the coupon via mail to:

Thrivent Financial
PO Box 8065
Appleton, WI 54912-8065

1. Begin the loan process by calling us at 800-984-9425 to discuss your particular situation.
2. Thrivent Church Loans will conduct an initial review.
3. Submit your application to the Thrivent Church Loans department as directed on the loan application form that we will provide to you.
4. Thrivent Church Loans will underwrite the loan. Upon approval, we will send the congregation a formal letter of our commitment to provide the loan. Typically it takes about two weeks to complete the underwriting process and to issue the formal commitment to your church or institution.
5. Provide supporting documentation as required by the commitment letter.
6. The timeline to close and fund the loan depends on specific requirements. (For example, most loans require a borrowing resolution to be approved by the congregation, so you will need to do that in accordance with your constitution and by-laws.) Once we receive the specific closing requirements, it takes about two weeks to review the items submitted, prepare the loan documents and schedule the closing. These timeframes are estimates and may vary based on the nature of the project.

See typical process below:

Adjustable Rate or Variable Rate loans have interest rates which change at set periods of time over the life of the loan. These loans are also referred to as ARMs (Adjustable Rate Mortgages).

Amortization refers to the amount of time it would take to repay the loan in full if equal monthly payments are made throughout the entire loan term. The length of the amortization period drives the monthly payment amount.

Balloon Payment or Balance refers to the amount that will be unpaid and owing on the mortgage loan at the end of the term (maturity) when a mortgage loan does not fully amortize over the term of the loan. For example, a loan with a 10 year term that is being paid using a 30 year amortization, will have a balloon payment due at maturity. That’s because monthly payments have been calculated as though the loan would be fully paid over those 30 years (the amortization period).

Commitment fee or Origination fee is an upfront fee charged by the lender to compensate for the lender’s commitment to loan funds and the cost of processing the loan.

Commitment letter is a formal document between borrower and lender laying out the basic terms of the loan. Both borrower and lender sign the commitment letter, making it legally binding. The basic terms from the commitment letter are the terms used to draft the final loan documents.

Fixed rate is a rate of interest paid that is set and does not change for the fixed term. A rate may be fixed for all or part of the term of the loan. This allows the borrower to accurately predict their future payments.

Fixed-rate Period refers to the length of time that the interest rate is set. At the end of the period, the interest rate changes. A five-year fixed-rate period is most common among commercial lenders. Generally, loans with shorter fixed-rate periods have lower interest rates than those with longer fixed-rate periods.

Interest rate refers to the percentage of principal paid for the use of the assets. Generally, longer term interest rates are higher than shorter term rates. Interest rates are typically quoted on an annual basis.

Maturity is the date the remaining principal and interest amount are due to be fully repaid.

Mortgage is a document granting a security interest in specific real estate to the lender providing the loan, as collateral for the repayment of that loan.

Prepayment penalty is a provision in your mortgage with the lender that defines the penalty to be paid in the event a loan is paid off early. Most often, penalties are expressed as a percentage of the outstanding balance. Penalties are typically charged by lenders to partially offset the lower interest rates anticipated when reinvesting the funds.

Term refers to the length of time from the closing of the loan to the maturity date of the loan when any outstanding balance must be repaid. When the term is shorter than the amortization, it results in a balloon balance.