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 Frequently Asked Questions...
How is my investment helping churches and BGC ministries? Your investment, pooled together with 1700+ other investors, allows the BGC Cornerstone Fund to have funds available to offer competitively priced loans to our BGC churches, districts, and affiliated ministries throughout the U.S. and Virgin Islands. What types of investments are available from the Fund? The Fund offers fixed rate certificates of varying terms, six months – five years, paying varying rates of interest depending on the term selected. The Fund also offers a 30 day Demand Certificate that earns interest. The rate of this certificate is reviewed and can be adjusted weekly by the Fund management. The Fund also offers both Traditional and Roth IRAs. Our IRA investments earn the highest rates offered by the Fund. Are investments with the Fund insured? The Fund’s certificates are not insured by the F.D.I.C., S.I.P.C., any state bank insurance fund, or any other governmental agency. The Fund however, currently has $22.2 million in net assets and has never missed a payment of principal or interest owed to an investor. Please read our offering circular for a complete listing of risks associated before investing with the Cornerstone Fund. How is my interest calculated? For term certificates, interest is accrued on the basis of the actual number of days in a year and can be paid monthly, quarterly, semi-annually, annually, or re-invested semi-annually on June 30th and December 31st. For the 30 day Demand Certificate, interest is accrued on the same basis, at a rate that is reviewed and can be adjusted on a weekly basis. Interest is paid semi-annually or at redemption, or it can be reinvested semi-annually on June 30th and December 31st. On our IRA investments, interest rates adjust semi-annually on June 30th and December 31st. The rates offered on these investments are the highest offered through the Fund and are based on current 5 year term investment rates as of June 30th and December 31st. What is the difference between the stated interest rate and the APY? The stated interest rate refers to the percentage of return that you will receive on your investment. APY refers to Annual Percentage Yield. If you re-invest the interest earned, you will begin to earn interest on your interest. This is called compounding interest. Therefore the APY, that which you are actually earning on your initial investment, is higher than the stated interest rate if you choose to re-invest your interest. How are interest rates on Cornerstone Fund certificates determined? The Fund’s management reviews the rates on a weekly basis. The Fund’s management determines the rates based on comparison to Treasuries, Agencies, and other like-term certificate offerings as quoted on the Bank Rate Monitor (www.bankrate.com). The interest rate you will receive on our term certificates is based on the prevailing interest rate that is in effect on the day the investment is received. This rate will be in effect during the entire term of the certificate. The interest rate on our demand certificate is adjustable. As market conditions change, we periodically change the interest rate in effect on our demand certificate. Interest rates are reviewed and potentially adjustable on a weekly basis. Is the Cornerstone Fund growing? The BGC Cornerstone Fund incorporated in 1989 as an Illinois not-for-profit organization, taking over the operations of the Revolving Building Trust. The Fund and its predecessor have been in existence for over 50 years. The Revolving Building Trust started with approximately $88,000 in assets in 1954. The Fund has grown steadily over the years to over $107.2 million in total assets as of 7/26/07. The Fund is continuing to experience great growth allowing us to commit larger dollar amount loans to increasing numbers of churches. Currently the Fund has outstanding loans to 106 churches and ministries of the Baptist General Conference. How can I become an investor with the Cornerstone Fund? See our Steps to Investing page under the type
of investment you are considering. Click the appropriate link: Is the Cornerstone Fund registered to sell investments in my state? The Fund is registered to sell securities in 38 states. Unfortunately we are not registered to sell securities to residents of the following states or districts: Alabama How do Traditional and Roth IRAs differ? With a Traditional IRA, the contributions you make are typically deductible for the year the investment is made and taxable when the funds are withdrawn from the IRA. With a Roth IRA, the contributions are not deductible for the year the investment is made but when you take a “qualified distribution” the distribution is taken tax free. How do I open an account for a minor? A minor is unable to be a sole owner of a BGC Cornerstone Fund certificate. The correct way to open an account for a minor would be to open a Joint Account with an adult. At the top of the application under Type of Ownership; please check “Joint”. On the first line of the investment application, list the child’s name, social security number, and birth date. The second line of the application should list the appropriate adult who will then be a “Joint Owner” with the minor. The adult who is joint owner of the certificate is required to sign and date the application. Click here to take you to our Steps to Investing page for complete listing of steps needed to become an investor. What happens when my certificate matures? Approximately 30 days prior to the maturity of your certificate, you will receive a Maturity Notice in the mail. This will be accompanied by a Response Form listing your options for the certificate at maturity. If you are do not wish to make any changes to the certificate (i.e., term, amount), there is no need to do anything as the certificate will automatically rollover. If you are making any changes, check the appropriate option on the Response Form and return to our office. If you do not respond to the notice within 10 calendar days of maturity your certificate will rollover for a like term. If you are going to liquidate the certificate, return the form along with the original certificate to the BGC Cornerstone Fund. A check will be mailed to you for the certificate's value at maturity the day your certificate matures. What are the penalties associated with redeeming my certificates before maturity? Upon early liquidation of a term certificate, a
penalty is assessed equal to three months of interest earned on the
redeemed fixed rate certificate. Can I have co-owners on my certificate? Yes. The suggested format would be “joint tenants with right of survivorship but not as tenants in common.” All statements and 1099INT information will be issued to one primary person. What happens if I lose my certificate? The Fund will re-issue the certificate once we have received a signed “Lost Certificate Affidavit” provided to you by the Fund. Please contact the Fund, 1.800.323.4215, to receive the necessary paperwork. What would happen to my investment if I should pass away? The proceeds would be paid to the co-owners or beneficiary pursuant to a “Payable on Death” or similar agreement. If there were no record of desired co-owners or beneficiary, the proceeds would go to your estate. The Fund would need to have a copy of your death certificate on file, and other appropriate documentation, before we can process the redemption. Can my investment be managed by someone other than myself? Yes. You will need to provide the Fund with some documentation, such as a Power of Attorney, trust document naming a trustee, etc… Can I add to my investment certificate? You can add to a demand certificate either through mailing a subsequent investment to the Fund’s mailing address or by direct investment. Direct investments can be made on the 1st and/or 15th of the month and will require an authorization document along with a voided check or deposit slip to initially set up this type of transaction. Can my interest be mailed directly to my bank? Yes. The Fund will need a deposit slip with your bank account information to set this up for you. Am I able to receive a loan through the Cornerstone Fund? We currently offer financing to BGC churches, districts, and affiliated ministries. Individuals unfortunately are not able to receive a loan from the Fund at this time. How long does it take to process my loan request? The Fund strives to approve new loans in a timely manner to ensure that project deadlines will be met. There is quite a variance in the time required to process loans – depending on the scope and complexities of the project. The total process (from receipt of all required application materials through closing) will generally take from 4-10 weeks. The Fund looks at three areas when considering a loan application:
Vince Moxon, Assistant Director of Loan Services, will gladly walk you through the specifics of how we make loan decisions. Give him a call at 1.800.323.4215 x3207 or email him at vmoxon@baptistgeneral.org. |
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