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Business loans for medical professionals

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Business loans for medical professionals

Need funding for your medical practice? Here’s how to get the business loan you need.

Running your own medical practice requires sound financial knowledge and management skills, no matter if you’re just starting out or have years of experience as a doctor. Knowing the financing options available for your practice is crucial at every step, and our guide will outline the loans you might need when running your business.
OnDeck Small Business Loans

OnDeck Small Business Loans

Among the largest online business lenders offering term loans and lines of credit at competitive fixed rates.

  • Minimum Amount: $5,000
  • Maximum Amount: 500000
  • Loan Term: 3 to 36 months
  • Simple online application process with fast decisions
  • Dedicated loan specialists and loyalty benefits
  • Must have been in business for at least one year with annual revenue of $100,000+
  • Must have a personal credit score of 500+

    6 types of loans to consider for medical practices

    What business loan does your medical practice need? We’ve narrowed the list down to six financing options that match how medical practices bring in revenue and their common expenses.

    Loan typeTypical amountFeatures
    Line of credit$5,000 to $1 millionBusiness lines of credit give your medical practice ongoing access to funding when you need it for whatever you need it for. You only pay interest on the amount you borrow.
    Invoice financingUp to 80% of the invoiceJust because your practice has regular patients doesn’t mean you get paid when you need it. Invoice financing is an advance on the amount you’ll be paid by the patient.
    Invoice factoringUp to 90% of the invoiceInvoice factoring works similarly to invoice financing, but rather than receiving an advance on your invoices, you sell your invoice to a third-party.
    Fixed term business loan$2,000 to $5 millionWith a fixed term business loan, you can borrow a large lump sum and pay it back over the course of years. These can have fixed or variable interest rates. If your business qualifies, you may be able to borrow an Small Business Administration loan.
    Equipment loanCost of equipmentFrom a suite of office furniture for your lobby to a new X-ray machine, an equipment loan can finance nearly any expensive equipment. The equipment acts as collateral, giving you access to lower rates.
    Short-term business loan$2,000 – $250,000These are lump-sum loans with terms ranging from 3 to 12 months. Use it to cover unexpected expenses or seasonal cash flow shortages. They typically come with a quick and easy application process.

    Compare top business loans you can apply for today

    Rates last updated June 25th, 2018
    Name Product Product Description Min Loan Amount Max. Loan Amount Requirements
    LendingClub Business Loans
    With loan terms that vary from 1 to 5 years, enjoy fixed monthly payments and no prepayment penalties through this award-winning lender.
    $5,000
    $300,000
    2+ years in business; $50,000+ in yearly sales; No bankruptcies or tax liens; At least 20% ownership of your business; Fair or better personal credit
    OnDeck Small Business Loans
    A leading online business lender offering flexible financing at competitive fixed rates.
    $5,000
    $500,000
    Must have been in business for at least one year with annual revenue of $100K+. Must have a personal credit score of 500+.
    LoanBuilder, A PayPal Service Business Loans
    Customizable loans with no origination fee for business owners in a hurry.
    $5,000
    $500,000
    Annual business revenue of at least $42,000, at least 9 months in business, personal credit score of 550+.
    Kabbage Small Business Line of Credit
    A simple, convenient online application could securely get the funds you need to grow your business.
    $2,000
    $250,000
    Must have been in business for at least 1 year. Revenue minimum is $50,000 annually or $4,200 per month over the last 3 months.
    Lending Express Business Loan Marketplace
    $5,000
    $500,000
    At least 3 months in business and $10,000+ in monthly revenue. Your business might also qualify if it has at least 6 months in business and $3,000+ in monthly revenue.
    National Business Capital Business Loans
    Get a large business loan to cover your financing needs, no matter what the purpose is. Startups welcome with 680+ credit score.
    $10,000
    $5,000,000
    Your company must have been in business for at least 6 months and have an annual revenue of at least $180,000.
    Fora Financial Business Loans
    No minimum credit score requirement and early repayment discounts for qualifying borrowers.
    $5,000
    $500,000
    Business age 6+ months. Monthly revenue $12,000+. No open bankruptcies.
    Excel Capital Management Small Business Loans
    Get personalized financing options that suit your unique business needs in just a few simple steps.
    Varies by loan type
    Varies by loan type
    Your business must operate in the US, be at least 1 year old and have monthly revenue of $15,000+.
    Balboa Capital Small Business Loan
    Short-term business financing with no minimum credit score or physical paperwork required.
    $2,500
    $250,000
    Must make $100,000 in annual revenue and be established for at least one year prior.
    LendingTree Business Loans
    Compare multiple business financing options in one place including: small business loans, lines of credit, SBA loans, equipment financing and more.
    Varies by lender and type of financing
    Varies by lender and type of financing
    Varies by lender, but you many require good personal credit, a minimum business age and minimum annual revenue.

    Compare up to 4 providers

    What can I use a medical practice business loan for?

    Business loans typically aren’t for propping up a failing practice. Instead, they’re an option for medical practices that need to expand.

    They’re also a suitable option for doctors who want to buy out another practice or start an independent one. A business loan can cover those crucial starting expenses that can make the difference between success and failure.

    A business loan can be helpful for:

    • Financing what you need to establish a new practice.
    • Funding to purchase an existing practice.
    • Buying or upgrading business equipment.
    • Managing ongoing cash flow needs.
    • Covering the day-to-day costs of running your business.
    • Meeting the expense of extending or expanding your practice.

    What should I consider when comparing business loans?

    Taking the time to analyze your loan options will benefit your business and save you money in the long run. Here are some of the top features you should compare in different loans.

    • Interest rates. You’ll need to choose what sort of monthly or quarterly payment your practice can handle. A lower interest rate results in a smaller loan, overall. But fees and loan terms may not align with your business needs.
    • Loan fees. Most business loans have an origination, service and other fees that your lender will discuss with you during the application process.
    • Loan amounts. Most lenders has maximum loan amounts that they offer borrowers. Make sure that the lender you choose will cover your financial needs.
    • Loan terms. Some loans, like lines of credit, have short terms that last only a year or two. Other larger loans can last for many years. Longer terms often mean lower monthly payments — but more money paid in interest.

    What do I need to be approved?

    Criteria for approval varies between lenders. Though, there are a few simple things you can do to improve the chances of your application being approved.

    • Check the criteria. Read the fine print to make sure you satisfy all of the loan eligibility criteria.
    • Prepare your financial documents. Make sure your balance sheets are in order. Have a detailed and realistic business plan in place that outlines how your business will grow in the future.
    • Get expert advice if needed. An independent accountant can crunch the numbers and help you make an informed decision about your practice’s financing options.

    Costs to consider when starting a new practice

    For many medical professionals, the opportunity to build your own practice from the ground up is an exciting opportunity. If you’re thinking of starting your own medical practice from scratch, consider the following expenses to factor into your budget:

    • Buying or leasing an office with enough space for each doctor.
    • Purchasing expensive medical equipment.
    • Acquiring essential office supplies.
    • Paying insurance premiums.
    • Advertising and marketing expenses.
    • Hiring and paying staff.

    Many of these are upfront costs you’ll need pay before you even open your doors. A business loan can help get things set up so your first few months run smoothly.

    Costs to consider when purchasing an existing practice

    If you’ve decided that purchasing an existing medical practice is a better option, there are still several costs to consider. Your financing options will vary depending on if you’re buying only the business or the property too.

    With both purchases, the office space will likely already be furnished and suited to many nonspecialized medical practices. Lenders may be willing to extend between 60% to 80% of the business’s value if you’re buying without property. While some may finance 100% of the business if you’re buying the business and the property.

    Apart from the actual cost of purchasing the business, other costs to consider when buying an existing practice include:

    • Any existing debts the business may have.
    • Funding necessary equipment upgrades.
    • Staff salaries.
    • Insurance costs.

    Bottom line

    A business loan can be an excellent way to increase your practice’s capital or fund a new venture, no matter your specialization. When you’re ready to apply, check for low rates and good terms to make sure your medical practice can flourish.

    Frequently asked questions

    Tim Falk

    A freelance writer with a passion for the written word, Tim loves helping people find the right products for them. When he's not chained to a computer, Tim can usually be found exploring the great outdoors.

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