Dentists & Dental Surgeons
Explore tailored financing options designed to support your dental practice’s cash flow needs, equipment upgrades, and operational expenses efficiently and effectively.
Intro To Dental Practice Business Loans
The requirements for a successful dental practice have evolved significantly. Advancements in technology now offer less invasive methods for procedures like x-rays and fillings. Additionally, there’s a growing need to consistently market your practice to attract patients seeking affordable plans. Managing these expenses becomes challenging when dentists face lengthy waits for reimbursements from insurance carriers. And when gearing up for the busy season, delinquent payments shouldn’t hinder your ability to secure the necessary resources to meet the surge in demand. 60Day Capital provides dental practice business loans designed to help you stay competitive despite the industry’s unpredictable payment structure.
In this guide, we’ll answer the following questions and more:
- What Are Dental Practice Business Loans?
- How Do Dental Practice Business Loans Work?
- What Are The Advantages of Business Loans For Dentists?
- What Are The Disadvantages of Business Loans For Dentists?
- Who Qualifies For Dental Practice Business Loans?
- How To Apply For Dental Practice Business Loans?
- What If I’m Declined For a Dental Practice Business Loan?
What Are Construction Business Loans?
Dental Practice Business Loans are tailored to meet the unique cash flow cycles and periodic expenses of dental practices. These loans not only address short-term needs and significant purchases but also help bridge cash flow gaps while dentists wait for reimbursements from insurance providers.
Business loans for dental practices can come in the form of:
Working Capital Loans
Revenue-Based Financing
Business Term Loans
Business Line of Credit
SBA Loans
Merchant Cash Advance
Equipment Financing
Invoice/Receivables Financing
How Do Dental Practice Business Loans Work?
Each type of dental practice business loan suits different expenses or cash flow issues. For example, if you need to cover payroll and other monthly bills while awaiting insurance reimbursements, solutions include a Business Line of Credit or Accounts Receivable Factoring.
A Business Line of Credit is ideal for short-term needs, where the reimbursement is expected soon. The interest rate depends on how quickly you can repay the balance. If reimbursements are uncertain or delayed, Accounts Receivable Factoring is suitable. You sell unpaid receivables at a discount (at least 85%), getting cash in a few business days while the factoring company collects the payment from the insurance provider. When the payment is received, you get the remainder, minus fees.
For those with subpar credit or inconsistent cash flow, a Merchant Cash Advance is a viable option. It allows borrowing against debit and credit card sales, providing cash to cover operational expenses during slow periods without requiring substantial payments until business improves.
Business Loan Options Compared
LOAN TYPES
MAX AMOUNTS
RATES
SPEED
- Merchant Cash Advances
- $5k – $1m
- Starting at 1-6% p/mo
- 1-2 business days
- SBA Loan
- $50k-$5.5m
- Starting at Prime + 2.75%
- 8-12 weeks
- Business Term Loan
- $10k to $5m
- Starting at 1-4% p/mo
- 1-3 business days
- Business Line of Credit
- $1k to $1m
- Starting at 1% p/mo
- 1-3 business days
- Receivables/Invoice Financing
- $10k-$10m
- Starting at 1% p/mo
- 1-2 weeks
- Equipment Financing
- Up to $5m per piece
- Starting at 3.5% (SBA)
- 3-10+ business days
- Revenue Based Business Loans
- $5K – $1m
- Starting at 1-6% p/mo
- 1-2 business days
What Are The Advantages of Business Loans For Dentists??
Dental Practice Business Loans smooth out cash flow, allowing you to continuously acquire the resources needed to serve more patients. You can stay up-to-date with equipment, pay recurring bills on time, and stock up on supplies ahead of the busy season. When business slows down, these loans enable you to maintain advertising campaigns and cover operational expenses despite decreasing revenue.
The same concept applies to cash flow gaps due to delinquent insurance payments. You can stay current on bills and cover sudden expenses rather than waiting weeks or months for compensation.
Most Dental Practice Business Loans can be accessed quickly. This means that when equipment breaks or supplies run low, you can have a solution in place within a few days. Even without consistent cash flow, you’ll have plenty of options during slow periods.
Lastly, while most dentists aim to help people, they must stay competitive like any other business. This might involve ramping up advertising or renovating the waiting area. The medical payment structure doesn’t make it easy to save for growth, making additional funding essential.
What Are The Disadvantages of Business Loans For Dentists?
Dentists may avoid additional debt due to their erratic cash flow. Appointments can get canceled, and patients often take their time paying bills. This unpredictability makes it difficult for dentists to forecast their cash flow for the coming months. Consequently, choosing the right loan product and borrowing amount becomes challenging. Incorrect decisions in these areas can increase financial pressure and distract you from your primary concern: serving your patients.
Additionally, medical technology advances rapidly, making leasing equipment more financially sensible than buying. When you already have numerous leasing bills, the last thing you want is to take on more debt.
Who Qualifies For Dentists & Dental Surgeons?
Approved businesses generally met the following criteria:
ANNUAL REVENUE
$75K+
CREDIT SCORE
550+
TIME IN BUSINESS
6 months+
How To Apply For Dental Practice Business Loans:
The amount of paperwork required for the application depends on your chosen product. For most products, funds can be approved and distributed within three business days. Here’s how to apply:
Step 1: Choose the Right Product
Start by identifying the most sensible solution for your specific needs. This involves researching the different types of loans and their suitability for various expenses and cash flow cycles. Determine whether you need to cover short-term or long-term expenses and whether demand is expected to increase or decrease in the coming months. This will help us recommend the appropriate borrowing amount and terms for your situation.
Step 2: Gather Your Documents
Here are the documents and information required for all Dental Practice Business Loans:
- Driver’s license
- Voided business check
- Bank statements from the past three months
- Invoice for equipment (for Equipment Financing)
- Credit card processing statements from the past three months (for Merchant Cash Advance)
- Accounts Receivable Aging Report (for Accounts Receivable Factoring)
- Debt Schedule (for Accounts Receivable Factoring)
SBA Loans require additional documents and information. To learn what’s needed for the SBA Loan application, visit our SBA Loan page.
Step 3: Fill Out Application
You can start the application process by calling us or filling out our one-page online application. You’ll need to provide the information from the previous section along with your desired funding amount.
Step 4: Speak to a Representative
After you apply, a representative will contact you to explain the repayment structure, rates, and terms of your available options. This ensures you won’t encounter any surprises or hidden fees during repayment.
Step 5: Receive Approval
Once approved, funds for Business Term Loans, Business Lines of Credit, Working Capital Loans, Equipment Financing, Merchant Cash Advance, Revenue-Based Business Loans, and Accounts Receivable Factoring will typically appear in your bank account within 24 hours to one week. For SBA Loans, it usually takes 3-5 weeks to receive funding.
Your Dental Practice Financing Gets Set Up – Now What?
Your business loan isn’t just a way to get financing; it’s also an excellent opportunity to start building (or improving) your credit.
Make all required payments on time and in full, regardless of the type of business loan you obtain. If you receive a business credit line or another form of revolving credit, keep your balance below the credit limit. Consistently making your business financing payments on time and in full will positively impact your credit, leading to preferred rates and terms when you next need business financing.
What If I’m Declined For a Dental Practice Business Loan?
If your application is declined, it might be because the chosen product doesn’t align well with your cash flow needs. In this case, we would likely recommend a different product with a more suitable repayment structure.
Another reason for a decline could be that taking on more debt would currently be detrimental to your financial health. In such situations, alternative financing tools might be more appropriate.
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