Nowhere in the Bible does God give permission for a church to go into debt. On the other hand, neither does the Bible expressly forbid a church from taking out a loan. Broadly speaking, however, it does not seem wise for a church to be in debt. In nearly every instance where debt is mentioned in the Bible, it is in a negative light (Deuteronomy 15:6; Deuteronomy 28:12; Proverbs 17:18).
Essentially, when a church takes on a debt, it becomes a slave to the institution making the loan: “The rich rules over the poor, and the borrower is the slave of the lender” (Proverbs 22:7). In the Old Testament, God wanted Israel to be a creditor nation—loaning money, not borrowing: “The Lord will open to you His good treasury, the heavens, to give the rain to your land in its season and to bless all the work of your hands. And you shall lend to many nations, but you shall not borrow. And the Lord will make you the head and not the tail, and you shall only go up and not down, if you obey the commandments of the Lord your God, which I command you today, being careful to do them” (Deuteronomy 28:12-13). In other words, God promised His people that He would make them the creditors if they obeyed Him, debtors if they disobeyed.
Here are three compelling reasons for a church not to go into debt: first, borrowing denies a church the opportunity to see God’s blessings: “And God is able to make all grace abound to you, so that having all sufficiency in all things at all times, you may abound in every good work” (2 Corinthians 9:8-13; see also Philippians 4:19). John tells us that, if we have confidence before God, we will receive from Him whatever we ask (1 John 3:21-22; see also Matthew 7:7 and James 1:5-6).
Second, a church having to service a debt restricts its ability to serve the Lord. Important ministry decisions may be affected by a need to make debt payments, and the actual work of the church may suffer as a result.
Finally, many churches choose to go into debt with the reasoning that “the new building, etc., will bring in more people, which will help us pay off the debt.” In point of fact, however, what really happens is that church contributions go toward the interest payments, not to the work of the gospel (Matthew 28:19-20). Studies have consistently shown that most denominations that go into debt spend more on their interest payments than they do on evangelism or mission work.
Perhaps the most damaging result of a church going into debt is the tension it places upon its members. The church wants to grow, but now its motives are mixed. It now has the additional obligation to keep up the monthly payments. The singleness of purpose and unity of motive have been diluted by the need for more income. If attendance slackens, financial difficulties are soon on the horizon. And the words of James are fulfilled: “The one who doubts is like a wave of the sea that is driven and tossed by the wind” (James 1:6-7).
When a church goes into debt, it is essentially trying to serve two masters: God and Money (Matthew 6:24). God tells us to walk by faith; Money says to walk by sight (2 Corinthians 5:7). God teaches us humility; Money, pride (1 Peter 5:5). God tells us to set our minds on the things above; Money, on things of the earth (Colossians 3:2). God tells us to look at things unseen and eternal; Money, at things seen and temporal (2 Corinthians 4:18). God tells us not to be anxious for anything; Money and anxiety are seldom separated (Matthew 6:31-33; Philippians 4:6). The truth is that the church cannot serve both God and Money and remain unified. Countless churches have been set back by an inability to sustain or pay off debt.
Church leaders must demonstrate through their abiding faith in God that He can and will provide whatever resources are needed, including financial resources. “For we walk by faith, not by sight (2 Corinthians 5:7; see also 2 Corinthians 4:18 and Hebrews 11:1). A church with no debt is an influential witness to its community that God does provide for His people, and it is blessed to serve others instead of servicing a debt.
“May grace and peace be multiplied to you in the knowledge of God and of Jesus our Lord. His divine power has granted to us all things that pertain to life and godliness, through the knowledge of him who called us to his own glory and excellence” (2 Peter 1:2-3). If He has “granted to us all things that pertain to life and godliness,” we can also be assured that everything the church needs to “go into the world and preach the gospel to the whole creation” will be provided as well (Mark 16:15).