Medical Business Loans for Medical Practices & Physicians - Nav
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Medical Business Loans

A business loan for doctors, or a medical business loan, can be used to cover a variety of expenses related to running a healthcare business, from paying staff to ordering supplies. Whether you are starting a medical practice, purchasing an existing practice, or just need a little cash to cover expenses until insurance companies pay you, consider business funding options focused on helping doctors and medical practice owners.

Medical business loans

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Get to know medical practice loans

Medical business loan details

Loan Amounts

$20,000 – $500,000

Interest rates

5.99 – 18% APR

repayment terms

2 to 10 years

turnaround time

As fast as 1 – 2 days

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Pros

  • Favorable rates
  • Prepayment discounts
  • Great for building credit
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Cons

  • Only available to medical professionals
  • High origination fees
  • Rates may be higher with lower credit scores

What are Medical Practice Loans?

A business term loan for doctors, also known as a medical practice or medical business loan, provides the working capital you need to:

  • Open a medical practice
  • Maintain cash flow until insurance companies reimburse you
  • Hire additional staff
  • Purchase medical equipment

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What You Need to Know About Medical Practice Loans & Financing

Before you apply for medical practice financing, weigh the pros and cons.

Business Loans for Doctors Pros

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Pros

  • Favorable rates
  • Prepayment discounts
  • Great for building credit

Whether you’re looking to start a medical practice or just pay your expenses while you wait for insurance companies to reimburse you, there’s plenty to love about small business loans for doctors.

Favorable Rates

Depending on the type of medical business loan you apply for (as well as your qualifications), you could see favorable rates and loan terms, which makes expanding your medical practice more affordable.

Prepayment Discounts

Not every business funding tool rewards you for paying off a loan early, but with some medical business loans, you may receive a discount if you pay your balance in full before it’s due.

Great for Building Credit

A medical practice business loan is one financial tool that is reported to business credit bureaus, which helps you build your business credit history and boost your business credit scores when you pay on time each month.

Business Loans for Doctors Cons

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Cons

  • Only available to medical professionals
  • High origination fees
  • Rates may be higher with lower credit scores

With all the good that these loans offer, there are also some drawbacks to consider.

Only Available to Medical Professionals

If you’re reading this, chances are you are a medical professional, but just know that the loan must be taken out by a doctor or other medical professional, and you may be required to show credentials.

Origination Fees

In addition to the interest rate you will pay on the loan amount, you may also have to pay origination fees, either as a percent of the total or a flat rate. These can significantly add to the cost of your loan, so be aware of them.

Rates May Be Higher With Lower Credit Scores

If you don’t have good to excellent personal or business credit scores, you may not automatically be turned down for a loan, but you may have a higher cost to secure that loan.

Medical Practice Lenders

Ready to get the working capital to help you launch or grow your medical business? Start with these Nav-approved financing partners.

Intermediate-Term Loan by Kapitus LogoApply now

Intermediate-Term Loan by Kapitus

Great for established businesses looking for large capital amounts.

Pros

  • Repayment term of 2-6 years for those who qualify
  • Favorable payment plans for businesses with $250k+ annual revenue
  • Specialty loan programs for medical practices.

Cons

  • Some repayment structures require weekly payments
  • Favorable terms for 3+ years time in business.

Funding Amount

$20,000 - $5,000,000

Cost

1%-1.5% per month

Repayment Terms

Weekly, bi-weekly, or monthly payments for 2 to 6 years

Funding Speed

1-3 days ($200,000 or less can be wired same day)

How Does a Business Loan for Doctors Work?

Applying for a healthcare practice loan is easy. You’ll be asked questions about your business, including how long you’ve been in business, your monthly or annual revenues, and your social security number and/or Employer Identification Number.

Once approved, you’ll be notified of how much you qualify to borrow and what your rate will be, as well as what your monthly payment will be.

You can apply for a medical practice loan through a traditional bank or a lender that specializes in loans to medical professionals.

How to Qualify for a Medical Practice Loan

While requirements will vary from lender to lender, generally, you’ll likely need to be in business two or more years and have annual revenues of at least $120,000 to qualify for a business loan for doctors. The more revenue you have the stronger your credit profile the better.

How to Apply for Medical Practice Financing

Applications for medical practice financing may vary slightly, depending on whether you go through a traditional lender like a bank or an alternative financing specialist.

In the application process, you may be asked what you intend to use the loan for. Some options include:

  • Business development
  • Equipment purchase
  • Payroll
  • Partner buyout
  • Working capital
  • Practice expansion
  • Startup

You should also know how much money you want to borrow. Additionally, you may be asked for your medical title and specialty, your social security number, and income information.

Lenders vary in how long they take to process applications, but some can get you funds within days.

What Can Medical Practice Loans Be Used For?

As long as you’re using your term loan for expenses related to starting or building your medical practice, you’ll be fine. Here are a few examples of how you might use yours.

You offer x-ray services and know that if you upgrade your equipment with the newest technology, you can attract more customers and bring in more revenues. But you don’t have the capital to purchase such a high-cost item. A business loan can help.

You’d like to expand your practice to a second location to serve more of the population. Expansion will require a large outlay of capital for remodeling the space, hiring more staff, and purchasing equipment. Taking out a healthcare practice loan will help you quickly reach profitability.

You might have the opportunity to buy commercial real estate for your practice, and a bank loan can help you leverage a great deal.

You might simply be looking for a cash advance to keep cash flow stable, pay your staff on time, and keep things running smoothly until insurance companies pay out on claims.

Alternatives to Business Loans for Doctors

While some lenders specialize in financial products geared toward medical professionals, they’re not your only option. Here are several other financing tools to consider to help move your business along.

SBA Loans

If you qualify, SBA loans can offer low rates and long repayment terms. Explore the different types of SBA loans to find the best one for your needs.

Bank Loans

While many banks offer SBA loans, they also offer conventional financial products. Traditional bank loans can have great rates and repayment terms if you qualify.

Line of Credit

If you would rather have access to funds you can access when you need them, repay them, and use them again rather than a lump sum you immediately have to start paying back, consider a line of credit.

Equipment Financing

If you need to purchase medical equipment, there are specific equipment financing options available to you. The equipment you’re purchasing is the collateral to secure the equipment financing, which may help you qualify for a lower interest rate.

Business Credit Cards

If you just need access to funds for unforeseen expenses, business credit cards might be your best option. Just be sure to pay off your balance in full to avoid unnecessary interest fees.

Merchant Cash Advance

If you’re looking at alternative loans and quick access to cash, perhaps because you don’t qualify for any of the above or have a less-than-perfect credit history, there are online lenders who offer merchant cash advance loans that don’t require high credit scores.

Running an existing practice or opening a new one, while potentially lucrative, can be costly. Having the right medical practice funding solution can ensure that cash flows steadily and you can take advantage of opportunities for growth.

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