Each geographic and ethnic district of The Alliance can obtain an unsecured line of credit (LOC) up to $200,000. These LOCs carry a term of five years and will receive the extension church interest rate. The interest rate will be subject to monthly adjustment.
LOCs are renewable through the normal application and approval process, and an LOC balance does not have to be paid off prior to renewal. Regular monthly payments are to be interest-only. Payments may be applied to principal balances following the same payment application rules as for standard Orchard Alliance loans.
Funds drawn on an LOC are to be used for the same real property purposes for which standard loans must be used. To request an LOC disbursement, the district must provide:
A formal request on district letterhead, signed by an authorized signer on file with Orchard Alliance
A detailed description of how the funds are to be used
An explanation of how the funds are to be sent and to whom, including wiring/ACH instructions, if necessary
We will send funds directly to district churches, if requested; however, we will not take responsibility for accounting for the borrowing of individual churches. If an LOC is used for multiple, simultaneous purposes, it is the responsibility of the district to account for principal and interest balances for each beneficiary. Beneficiaries of LOC funds other than the district may make payments directly to us; however, we will not keep record of which party makes a particular payment – this record keeping is the sole responsibility of the district. Likewise, we will not bill beneficiaries, nor will we consider beneficiaries liable for the borrowed funds.
Larger LOCs may be granted to districts, as long as the LOC is secured by district-owned property. The LOC must adhere to the 80 percent loan-to-value guidelines in addition to the LOC guidelines described above. Our board of directors must approve all secured LOC requests.
Loans are underwritten and funded by The Alliance Development Fund, Inc. (ADF), which conducts its operations, together with the operations of The Orchard Foundation, under the brand name Orchard Alliance; however, only ADF is responsible and liable for the lending operations of Orchard Alliance.