5 Tips to Get the Best Medical Practice Loan
Medical practice loans are a hot topic. They allow new dental, veterinary, medical, optical, and pharmacy practitioners, those who have recently relocated, or those who are interested in expanding their practice to do so in an affordable way. However, the most savvy business professionals know how to get the best medical practice loan out there!
1. Shop Around
Different bankers will offer different options for medical or dental practice loans—some will be perfect for your unique situation, others may be a bit less ideal. While it may be tempting to use the bank across the street from your dental practice, the bank you have your home loan with, or the bank that you have been frequenting since you got you first job, the bank that provides the medical practice loan for your business can make or break its success. This is especially true in the fields of dentistry, veterinary services, medicine, optometry, and pharmacy. A number of different options exist for medical practice loans, and you want to find the best one possible. Consider not only calling around or looking on the internet, but going in person to see what your options are with local banks. There are a number of different options, and some lenders will be more likely to find a great deal if you do a variety of business transactions with them. By doing your homework, you can save your business and yourself some money!
2. Make sure to use the right borrowing tool
A loan is a loan, right? Not necessarily. There may be different options for those who are seeking to expand their dental, veterinary, medical, optical, or pharmacy buildings, incorporate new technology, or accommodate temporary increases in spending. No matter what your financial needs are, making sure that you understand and are able to communicate these needs with your lender will help you to secure the right type of loan for your needs, at the best interest rates available.
3. Try to cover your operating costs with income
A loan or line of credit can be a great solution to a lack of finances, but running on a constant line of credit can quickly kill your medical practice business. Borrowing money to make ends meet is never a good idea for a household, and it is just as unadvisable for a business. There are always exceptions, but in general, try to make sure that your business’s revenue is adequate to cover your basic daily operating costs. Save your loans and credit lines for big expenditures and you will see greater returns.
4. Make sure your benefits outweigh your costs—and interest!
Business expenditures can have excellent returns—are you considering implementing the newest technology or building your dream clinic that can accommodate twice the number of patients? Before diving in, consider the expected returns and the cost of interest on your medical or pharmacy practice loan. While our medical practice loans have some of the best interest rates around, if your costs are still going to exceed that amount, you may be better off waiting until the technology becomes less expensive. Take off the white coat, put on your business glasses, and work some numbers to determine just how much your investment will really pay off before committing yourself.
5. Stay on top of paperwork and accountability
Many business loans for joint practitioners include a clause of “joint and several” liability, which means that the practice as a whole, as well as individual partners, are all liable for the loan. This means that every medical, optical, or pharmacy specialist will be jointly responsible for this loan. What happens if one of your partners leaves the firm? While that partner is still liable, the practice as a whole maintains liability as well, which could leave the remaining physicians in a tight situation. Read your documentation carefully and put into place a strong contingency plan that will allow you to be prepared in the event of anything that may occur.
More Doctors and Medical Practitioners Seeking Business Loans
It’s no surprise that there is an increased need for loans and financial solutions amongst medical professionals. This is a trend that is occurring across the country in a variety of economic settings. Since 2000, which many consider the beginning of the country’s financial recession, there has been a tenfold increase in the number of government-backed loans to medical professionals. These professionals include physicians, dentists, ophthalmologists, veterinarian optometrists, and pharmacists—a major sector of our economy.
Why the increase?
Many costs of business have risen in recent years. These include increased costs of heating and cooling, changing regulations, increasing drug costs, and the falling cost of health insurance reimbursement. This leaves many practicing professionals needing to revitalize their business—a process that often requires some capital. In particular, private practice professionals in the dental, veterinary, medical and optical space have been hit hard by this, as many of the overhead costs have increased greatly in recent years.
What are medical loans used for?
Medical practitioners use business loans for anything from payroll expenses, to incorporating digital record management, to expanding their physical locations and buying new equipment. Anything that needs to be funded can be funded through a medical practice loan. For new practitioners, this can be a valuable way of establishing your business and meeting major expenses before income starts rolling in; for experienced practitioners, this can be a perfect opportunity to modernize your business or offer a competitive advantage that nobody else in town has.
Can my business benefit from a loan?
Chances are, if you have analyzed your finances and operating costs and found a need, a business loan can help you to fill that need. You can use business loan capital to make valuable additions to your business that will allow it to grow and thrive. This will not only increase revenue, but will provide valuable services to your clients. Meet their needs with loan money—and pay it back in affordable terms. If you are considering a medical practice loan, you are not alone—you are joining thousands of successful private practitioners and firms that have gotten their start in the same manner.
Use Your Debt Wisely: Debt Consolidation through Medical Practice Loans
Like most sectors of the financial world, healthcare and other medical practitioners face mounting debt. A physician, veterinarian, or mental health practitioner may face a variety of old debts that must be paid every month—often with very high interest rates. Since raising rates isn’t always an option, how can medical practitioners decrease debt?
Medical practice loans offer competitive interest rates
Perhaps you took out a personal loan or small business loan when you first opened your business. This got you on your feet, but was it really the best option? Many of today’s medical practice loans are offered at highly competitive interest rates, allowing you to reduce the amount you pay each month. Even a decrease of two or three interest points can translate to thousands of dollars saved each month, which can help your practice to grow. Further, for experienced professionals, the years of strong credit history and the capital of your property or business may actually work in your favor, affording you a far lower interest rate than the one you started with when you were fresh out of medical school.
All your debts in one place
Managing multiple debts can be a challenge for the best financial managers—for a busy medical practitioner, it can be a draining burden. Consolidate the debt and the hassle by seeking a medical practice loan that will allow you to pay off your other debts and manage one simple payment per month. This will reduce the drain on your time and professional ability, and allow you to focus on what you do best: medicine.
Flexible repayment options
Medical practice loans offer the most flexible options and greatest amount of control for your loan management and repayment. For example, you have better control of the amount of money that will be directed to your interest and principal amounts, allowing you to save money over the course of the loan. And if your practice suddenly starts bringing in more money? With many other types of loans, there are few rewards for paying off early. With many of our medical practice loans, there are a variety of early payoff options that will allow you to take advantages of low monthly payment options at fist, with the chance to reduce these payments and receive early payoff bonuses once your practice really takes off. No matter what your business and debt needs are, a medical practice loans can be a strong options to reduce debt while increasing revenue.
USMF put together for me the most unique and competitive debt restructuring program I found. The resulting 30% monthly cash flow increase has given me greater revenues and allowed me to expand my practice and gain more control of my business. I highly recommend USMF.
US Medical Funding was the most professional and knowledgeable company I spoke with. They were concerned with my needs and very willing to help and answer all my questions. My calls were always returned promptly. Their programs are flexible. They worked diligently to customize a program tailored to my specific financial needs. All deadlines were met. They went above and beyond my expectations. I highly recommend their services.
Marc Cornella has been a trusted advisor since my transition from employee to employer. I had very little prior business experience when I started the process of buying my current practice. Marc not only guided me into a great mortgage but also advised me through my building acquisition two years later even though he did not directly broker the deal. I appreciate Marc’s skills so much that I have recommended Marc to my associate as she starts the process of buying into my practice.
As a result of the customized financing program USMF tailored for our new, state-of-the-art facility, our revenues have grown, our profits are strong, and we have experienced greater control and satisfaction in our new business. Many thanks to Marc Cornella and the entire USMF staff!
I want to sincerely thank US Medical Funding for all their hard work and dedication. They were able to help me secure a great loan with no money down, awesome interest rate and even helped me negotiate the right price with the seller. Very straight forward from day one. I am looking forward to work with you all on my second acquisition. Thanks again.
I highly recommend US Medical Funding. Marc Cornella helped me with equipment purchase and working capital loans for my veterinary hospital. He was timely, creative at looking into several options and he really gave me a personal approach that set him apart from other companies. Because of his many years of experience in the industry, he was familiar with the companies we work with as a veterinary hospital which made it easy to communicate our needs to him. US Medical Funding really helped me out in a time of need and I would use them again in the future and I will recommend their services to my colleagues.