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Where to get dental practice loans

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Get your dental practice up and running or take it to the next level with financing tailored to your needs.

You’re well trained, you’ve got a plan and you’re ready to fully invest in your own business — and help people smile with a little more confidence. After all, it’s what you love.

But the total cost of starting a dental practice can be jarring. In 2015, Bank of America put the average total cost of a new practice startup at $400,000. You can find ways to reduce that cost, but you might not be willing to sacrifice square footage or location.

Rest assured, you have funding options aplenty to choose from. We review financing options and discuss how to compare them and where to apply.

LoanBuilder, A PayPal Service Business Loans

Our top pick: LoanBuilder, A PayPal Service

Customizable business loans with no hidden fees.

  • Min. Amount: $5,000
  • Max. Amount: $500,000
  • One-time fixed fee charged over the life of the loan
  • Acclaimed customer service
  • Requirements: $100,000+ annual revenue, 1+ years in business, 600+ personal credit score

    What financing options are available for dental practices?

    You’ll find many types of financing for your practice, including:

    • Commercial real estate. Purchasing an office space may be one of the single most expensive costs to starting or acquiring a practice. Fortunately, financing options are available to help with commercial properties.
    • Business equipment. If you don’t want to deal with the potentially outlandish costs of leasing equipment, you may want to purchase your own or upgrade. Lenders and merchants alike may have financing that suits your needs. Learn more about business equipment financing.
    • SBA loan. The most common SBA loan, an SBA 7(a) loan could give you the funds to consolidate debt, acquire working capital, redecorate or renovate your practice, purchase equipment and more. Learn more about SBA loans.
    • Invoice financing. Get an advance or line of credit on your accounts receivable to bridge the need between the time you invoice patients and when you’re actually paid. Learn more about invoice financing.
    • Merchant advance. This type of financing can be useful if you don’t qualify for other types of lending. It depends mainly on your income — not your credit — and works by taking a percentage of your credit card transactions to repay your loan. Learn more about merchant advances.
    • General purpose. Get a business loan that can be used for just about any legitimate business expense that may fall outside of the specialized options above. Learn more about all business loans.

    Top business lenders to compare for dental practice financing

    Rates last updated August 20th, 2018
    Unfortunately, none of the business loan providers currently offer loans for these criteria.
    Name Product Product Description Min Loan Amount Max. Loan Amount Requirements
    LoanBuilder, A PayPal Service Business Loans
    Customizable loans with no origination fee for business owners in a hurry.
    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.
    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
    At least 3 months in business and $10,000+ in monthly revenue. Your business might also qualify if it's been in business at least 6 months with $3,000+ in monthly revenue.
    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+.
    LendingTree Business Loans
    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.
    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.
    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
    Fora Financial Business Loans
    No minimum credit score requirement and early repayment discounts for qualifying borrowers.
    Business age 6+ months. Monthly revenue $12,000+. No open bankruptcies.
    OnDeck Small Business Loans
    A leading online business lender offering flexible financing at competitive fixed rates.
    Must have been in business for at least one year with annual revenue of $100K+. Must have a personal credit score of 500+.
    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.
    Your company must have been in business for at least 6 months and have an annual revenue of at least $180,000.
    Seek Business Capital Funding Solutions
    Startups and newer businesses could qualify for loans and credit cards with a custom financing package.
    Personal credit of 680+, no bankruptcies in the last 4 years. Business Loan Marketplace
    Get connected with wide range of loan amounts and multiple loan types from reputable lenders.
    Must have good credit and at least 6 months in business.

    Compare up to 4 providers

    How do I compare my financing options?

    There’s a lot to consider when you’re going through the many offers and features of a dental practice loan. Here’s a short list of elements to weigh.

    • Loan amount. Not all providers may offer the amount you need, but try to get as close to it without going over. Borrowing too much could lead to paying unnecessary interest on the excess.
    • Loan term. When it comes to loans, a longer term can mean lower monthly payments but a higher cost overall. These longer term loans typically come with fixed payments, while both lines of credit and invoice financing run on variable terms. While the former is usually based on monthly or bimonthly due dates, the latter doesn’t have scheduled repayments.
    • Your eligibility. Different providers require different criteria for you and your business to meet. Your credit score, business’s age, annual revenue and state of residency, as well as whether you’re insured, are likely to come up, depending on the type of financing you’re pursuing.
    • Interest rate. How much you’re charged in interest is determined by many factors: your personal credit score, the type of loan, the amount of the loan, the term and the lender all affect what you’re offered.
    • Fees and costs. Outside of the interest rate, you could face origination and application fees. These may be negotiable, so don’t hesitate to ask. Your APR includes the fees and costs associated with the interest rate and can give you a better idea of the total cost of your loan. Other costs include prepayment fees if you intend to pay your loan off early.
    • Type of loan. SBA loans are guaranteed by the government, which can cut down on the cost of the loan. You’ll often find the strictest requirements traditional bank loans, but dental practice–specific bank loans could increase your odds of approval. Beyond banks, there’s peer-to-peer lending, which operates by connecting borrowers with investors — or “peers” — who fund a portion of or the entire loan amount.

    Dental practice purchase financing

    You have several advantages to buying an already established dental practice, one of the most evident is having a built-in patient base and staff.

    When you’re looking into financing that purchase, you’ll want to have some backup. You may want to choose several professional advisers specific to the process, including a transition consultant and accountant.

    Financing can come from one of two sources: the seller or a third party. In either case, you’ll need to provide a good deal of information. Your resume, annual income and credit score are just a few of the items you may need.

    The purchase of an existing practice is also separate from the purchase of upgraded equipment — or real estate, if you plan on buying the location. Talk with your advisers in detail about your wants and needs so that they can assist you with determining what’s feasible.

    What do I need to apply?

    While requirements vary based on the lender, here are few basic details you can expect to provide:

    • Your business plan
    • Personal banking and income documents
    • Business revenue documents
    • Your dental and DEA license
    • A statement of your personal net worth
    • Details of what the loan is for and how much you need

    6 business tips to keep in mind

    1. Do your research. If you’re on this page, you’re already dedicated to learning as much as you can. You can browse the business lenders in the left-hand menu to read loan reviews.
    2. Select trusted advisers. Dental school may not have provided adequate business lessons to run your own practice. Even if you have some business background, it can greatly benefit you and your practice to maintain a working relationship with specialized professionals.
    3. Plan, plan, plan. You might talk with the advisers you select, draw up your plan and continue to refine it. It can also help to make sure your budget is lined up for worst-case scenarios, taking into account any future projects.
    4. Pay your bills on time. Keeping up with your finances keeps your overall creditworthiness in check, which can assist your chances of acquiring a loan.
    5. Know your limits. Part of budgeting is knowing your limits. Carefully calculate — and recalculate — those financial limits to ensure you have solid numbers on your business cash flow.
    6. Maintain your insurance. Your practice largely depends on your well-being for success, and so a big chunk of business lenders will require you to have life insurance and disability insurance. Check for malpractice insurance requirements as well.

    4 tips to running a successful community dental practice

    dental practice financing

    • Manage your team well. A huge part of a successful business is a successful team. Keep your team informed, listen to them and have confidence in your decisions as a leader.
    • Communicate on all fronts. Marketing is important, but so is making sure that your team knows what’s going on. The health of the business is tied to the strength of your communication — and the health of your employees.
    • Get with the times. Keeping up with social media, new technology and cutting-edge treatments can keep your current patients stay happy as well as draw in new ones.
    • Maintain relationships. They’re the backbone of your practice. When you’re running a community practice, consider building your connection to that community. Likewise, a strong relationship with your staff can support that connection. Without a strong patient base and a dedicated staff, you probably won’t have a successful community dental practice.

    source: Patient News

    Bottom line

    You’re looking to start or grow your dental practice, and you want the best that you can get. Financing options come in many different forms, with conditions and terms that vary depending on your needs. Once you’re ready to apply, be sure to have a solid business plan in place. Not only will it speed up the application process, it could help you better manage and grow your practice.

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