Dental Practice Finance

We have lots of dentists and want to be dental practice owners ask us "How do i organise or apply for dental practice finance?"

There are 2 main answers to this questions. Self sourced or broker introduced. Self sourced financing is when you approach a main stream lender and ask for financing for the purchase of the new practice. There are some main stream lenders that are more engaged in the dental market and you will see these companies plying their trade at the major dental conferences and exhibitions.

Broker introduced lenders can however be an easier way to source funding and can also lead to significant savings.

Dental practice brokers traditionally have a selection of specific dental practice lenders whom they work with. Because it is a niche market there are some main lenders that dominate the market at the moment. They have an intricate knowledge of the dental market and are used to valuing and evaluating dental income streams. This puts them is a strong position to understand how your dental business works and more importantly stratify the potential lenders risk for each loan.

Most purchasers will eventually use the services of a dedicated dental financing firm. In our experience it is always good to speak with at least 2 firms and at best 3 firms. It is not uncommon for some brokers to have subsidiary companies which they own who they will push you to for financing. This is great for them as they will pick up a commission for selling the practice and also a commision for arranging the loan. If this is the case negotiate hard and get a better rate if possible. By speaking with 2 or 3 financing companies you will normally be able to get a slightly better rate than one which is readily recommended to you.
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