Frequently Asked Questions
What Are Church Bonds
Church Bonds are debt certificates issued to provide funds for building construction
or some other financial need. Governments, corporations, utilities and
other non-profit organizations issue Bonds to finance many kinds of projects.
Are Bonds Like Stock?
No. Stock represents ownership, while Bonds represent borrowed money.
With Bonds, the Borrower (church) agrees to repay the investors their
principal with interest.
How Is Interest Paid?
Simple interest Bonds pay the interest by check every six months. Compound
interest Bonds accrue and compound the interest every six months with
principal and interest paid at maturity. For the current interest rates
on these investments, please refer to our
What Secures My Investment?
The prospectus for each respective offering includes a section entitled
Security for the Bonds. Questions with regard to the security of the
bonds are addressed in the prospectus for each individual offering.
How Long Will My Money Be Invested?
Investors may choose bonds that mature at 6 month intervals for a period
up to 30 years.
How Do I Purchase A Church Bond?
Bonds are offered by churches only by means of a prospectus, which
sets forth the information you need to know before making the investment.
Copies of the prospectus are available from Rives, Leavell & Co.
Church bond prospectuses and other information on our current offerings is available on our . Please call or email us if you would like to speak with an Account Executive for more information.
How Do I Redeem My Bonds?
You do not have to do anything to redeem your church bond, since the bonds are issued in book entry
form. Upon maturity, the paying agent will automatically mail you a check
for your principal plus any accrued interest. You will receive an acknowledgment
within thirty days of purchase that the Trustee has registered your church
Bond(s). Be sure to inform the Trustee if your address changes.
Can The Church Pay The Bond Off
Before Maturity?
Yes, the church can redeem (call) any or all of its Bonds at three-month
intervals provided the owner of record receives a thirty-day written
notice. The Church will pay the accrued interest through the date of
the "call."
When Does The Interest Begin?
The interest begins to accrue on the issue date, provided that the Escrow
Agent receives payment for the Bond(s) on or before that date. Otherwise,
interest will begin on the date payment is received by the Escrow Agent.
Can Church Bonds Be Used To Fund IRA Accounts?
Yes. Investors can usually transfer (rollover) a present IRA or SEP funds
into a Self-Directed Account. You then instruct the Trustee of the self-directed
account to purchase Bonds of a church of your choice.
Can I Cash My Church Bond At Any
Time?
No. You should not buy a Church Bond with a maturity beyond when you think you will need the principal back. However, Church Bonds may be negotiable and can only be sold by the bondholder to a subsequent investor willing to purchase them, and the seller may incur a loss. The underwriter does not make an active secondary market in these bonds.
Is The Interest Taxable?
Yes, interest on Church Bonds is taxable as ordinary income. The owner
will receive a 1099 annually from the Registrar/Paying Agent.
How Much Money Can I Invest?
Bonds are offered in any multiple of $250, with a minimum purchase of
$250, i.e. $250, $5000, $12,250, $50,750, etc.
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