The foreclosure sale of the Greater Cleveland Avenue Christian Church property takes place today at the Forsyth County Courthouse, but that doesn’t mean it is the end of the story for either the church or its building.
The sale occurs at noon. It is taking place at the direction of Apex Bank, the current holder of the church’s debt of $3.3 million that was secured by the church property, following a ruling in bankruptcy court on Wednesday that denied an effort by the church to change the terms of its bankruptcy reorganization.
Judge Catharine Aron said the church had not demonstrated it could refinance the property, and ruled that the foreclosure could go forward. Aron also said that she believed the church had not acted in good faith in its proposed modification of the bankruptcy plan.
At the foreclosure sale, a representative of Apex Bank will be present to make the bank’s own bid on the property.
Even if a prospective buyer emerges for the 15-acre church property, that’s not the end of the process: A 10-day upset period starts in which some other buyer can step forward and top the high bid placed today. .
New bids have to be at least 5% higher than the previous high bid. Each upset bid kicks in a new 10-day upset period, until 10 days pass without an upset bid. If no outside bidders were to emerge, the bank would own the property.
Nothing prevents the church itself from bidding on the property, should it manage to get the money to carry forward. And the church can continue functioning in some new location, although in its motion before bankruptcy court on Wednesday, the church argued that leaving would make it impossible for the church to satisfy other creditors.
The church property consists of about 15 acres on Lansing Drive with a church sanctuary and family life center on the property.
The property has a tax value of $6.3 million, although the church pays no property tax because of the religious exemption.
The church borrowed the money leading to its current troubles in 2009. The original lender was Southern Community Bank and Trust, and the amount of the loan was $3.75 million. Apex Bank, based in Tennessee, acquired the loan in 2016.
When Greater Cleveland Avenue filed for Chapter 11 bankruptcy in April 2018, it still owed $3.3 million on the 2009 loan. In Wednesday’s hearing the current payoff amount on the loan was stated as being about $3.5 million.