For many medical practices, financing new equipment and facilities is nearly impossible.
Private medical practices have a difficult time securing loans through traditional banks because of their lack of collateral. But, that doesn’t mean you can’t or even shouldn’t apply for loans. There are alternative loan options designed specifically for medical practices that will help you fund your medical facility.
Hopefully this article serves as your introduction to them.
What Is a Medical Practice Loan?
A medical practice loan is a type of loan designed for the growing needs of private practices and medical offices.
These loans can be used for anything your business requires, from purchasing new equipment to building new facilities to maintaining cash flow. Medical practice loans are an alternative financing option designed specifically for private medical practices.
They are a practical alternative to traditional bank loans. Traditionally, it is helpful to have 3 years of tax returns, the names and addresses of all your vendors and suppliers, and three years of bank statements to apply for business funding.
How Can You Use a Medical Practice Loan?
Pay for expansion of your practice: Expanding your practice may be a great move for your business, but expansions can take funding.
Pay for new equipment: Medical practice loans are perfect for investing in new equipment. They help you keep your cash flow healthy, protect your profit margin, and are easily tax deductible.
Enhance patient experience: Upgrading your medical facility can go a long way toward improving the patient care experience.
Are There Restrictions on Medical Practice Loans?
Medical practice loans can be structured in a traditional way with traditional loan terms like 15, 20, and 30 years. Most loans will let you borrow up to $2 million. Usually, you’ll have a fixed rate and your repayments can be spread out over 5 to 15 years.
If you know in advance how much you need to borrow and your repayment terms, securing a loan will be easy. But you should know that we do have a few restrictions. We’ve worked especially hard to find flexible lending partners that offer medical practice loans, but we do have specific requirements. We ask that borrowers meet the following requirements: Be a physician, physician assistant, nurse midwife, or nurse practitioner with a valid license to practice medicine.
How Do Medical Practice Loans Work?
The exact terms of your medical practice loan will be based on your requirements and the lender you choose to work with.
You apply online: That’s the easy part. Then you get qualified and pre-approved. That’s the hard part. Medical loans are tough to qualify for and have access to. But if you do qualify, that doesn’t mean you should just take the first offer you receive.
Do business banking: You are most likely going to want to borrow the money and build your business at the same time. This may mean that you’ll be doing a lot of business with the lender you choose. That may mean that you’ll have to open an account with the lender to get a loan.
Make the purchase: When you buy brand new equipment, you’re taking advantage of tax breaks, tax credits, and tax deductions. You can still get financing for that equipment purchase through a loan, but you’ll have to make a down payment and pay back the loan
Who Uses Medical Practice Loans?
Doctors and other medical professionals use these loans for a variety of purposes.
They buy new lab equipment, they build new facilities, they refinance debt, and they even use them for investing in other companies and medical products. Doctors can also buy medical equipment like scales, meters, x-ray machines, and beds through a loan.
The best way to think of these loans is as an investment. They are an investment that returns handsomely over time. Medical practice loans are an especially smart investment in the current economy. With less than 3% of Americans with private insurance, there is a huge business opportunity for doctors who are willing to invest themselves into their medical practices.
Who Are the Medical Practice Lenders?
Medical practice lenders are lending institutions that specialize in providing financing for medical practices. Medical practice financing is not a traditional loan product, it is usually a more specialized financing product that is accompanied with greater borrower risk than a traditional loan from a lender. The medical practice lenders are compensated for this risk by charging a higher interest rate for medical practice loans than would be charged on a typical loan. They are also more stringent on the underwriting standards that must be met before a loan is approved.
Who Gives Medical Practice Loans?
Medical practice loans are available with medical practice loan programs through the Small Business Administration (SBA) and alternative lenders. Alternative lenders are usually found through online medical loan directories. The SBA has a healthcare loan program that is specifically for medical practices. You can also find traditional banking institutions that have specialty loans specifically designed for medical offices through your local bank.
No matter how you find your practice loans, be sure that they are unsecured, which means no collateral is needed to secure them.
At Quick Capital Funding, we specialize in finding loans for all situations. Our team has cultivated relationships with a bank lender network and investors who specialize in medical practice loans. We’ll take the time to get to know you and what you need. If you would like to learn more about how we can help you grow your business, please call 1-833-750-0485 or send an email to info@quick-capitalfunding.com.
