A Comprehensive Overview of Dental Practice Loans

How do you plan on funding your dream?

Dental Practice Financing with conventional loans

Dentists are unique when in comes to banking in that they often seek loans of $500,000 while having minimal assets, six figures in debt, and minimal work experience.  While this might sound crazy, it is the industry norm in a sector with one of the lowest default rates in the United States.

We have helped hundreds of dentists secure the right financing and have worked with each of the financial institutions who specialize in dental lending.  Below is an introduction to the primary lenders and some tips for how to make the best decision for your dental practice loan.

A conventional loan is put simply a financial institution lending money directly to a consumer.  Below are a few institutions who consistently offer specialized loans to dental start-ups. Rates are typically reasonable and most lenders will finance 100% of the cost of opening a dental practice, often in excess of $400,000.

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Bank of America Dental Practice Loan

Bank of America finances the majority of start-up dental practices in the United States and is very familiar with the lending space.  They have representatives across the country, extensive experience and understanding of the dental industry, and typically offer 100% financing at competitive rates.  It is important to be mindful of your long term vision as their prepayment penalty can affect groups who intend to own multiple practices.

Wells Fargo Dental Practice Loan

Wells Fargo is a leader in dental lending with representatives in markets across the country.  They have significant resources tailored for dentists, a significant understanding of the industry, and often offer 100% financing with competitive rates.

Other conventional Dental Lenders

In addition to the two major players listed above, there are a handful of community banks or credit unions, regional financial institutions, and nationwide lenders who offer up to 100%  financing in products designed especially for dentists. Additionally there are financial brokers who can work with you at no cost to help you determine the best financial package for you or to help a community bank with limited experience create a specialized loan for dentists.

We have a network of bankers across the country that specialize in lending to dentists and we work with our clients to make an informed decision on the best route given their long term vision and needs.

Dental SBA Loans

Another loan type available to dentists is an SBA loan.  This is a government backed loan that has a few additional requirements and is typically reserved for the purchase of assets (buildings, land, etc).  If you are looking to purchase a building, land, or a practice that includes the real estate, this can be a great option to help finance those assets.  There are a number of lenders who have specialized SBA products for dentists. Depending on your specific needs, we can happily make a recommendation.

Tips for securing the right loan for you

  • Meet with a lender early in your process to ensure you understand your budget and limitations
  • Provide 1-2 weeks for loan approval, ideally more.
  • Consider securing your practice loan before loans for a house or car
  • Do your best to have at least a small amount of cash stored up to display financial responsibility
  • Be transparent with lenders early in the process to help find the right loan