Via Reuters, just in time for the Easter holiday, Holy Bubble! According to the article, filings in
the Thomson Reuters Westlaw legal database show foreclosure proceedings against
U.S. churches have nearly tripled since December 2007, as compared with the
previous seven years. Court records also disclose more than 100 church
bankruptcies in the past year, and the number may be rising.
The report continues:
Spending on construction of religious buildings rose sharply
in the late 1990s, climbing 70 percent from 1995 to 1999 to an annual rate of
$7.3 billion. New building continued to tick up, eventually reaching an annual
rate of nearly $9 billion in 2003 before leveling off, according to data from
the U.S. Census Bureau.
As was the case in the residential housing market, the church
property boom was accompanied by the rise of more specialized lending. Church
lending was historically done by community banks, which sometimes have ties
through a member of a congregation. Loans were often set at a fixed rate and for
a set term.
The emergence of larger congregations and the rush to build
venues to accommodate them encouraged specialized lending that grew more aggressive.
Reuters focuses specifically on African-American churches, thousands
of which are reportedly in danger of foreclosure, concluding: “Their
congregations have suffered higher unemployment, and often the churches provide
more services.”
(HT: Rolfe
Winkler)