What You Need to Know About Business Loans for Doctors
Before you apply for medical financing, weigh the pros and cons.
- Favorable rates
- Prepayment discounts
- Great for building credit
- Only available to medical professionals
- High origination fees
- Rates may be higher with lower credit scores
Business Loans for Doctors Pros
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 business loans for doctors.
Depending on the type of loan you apply for (as well as your qualifications) you could see favorable rates and terms for a loan, which makes financing more affordable.
Not every business financing tool rewards you for paying off a loan early, but with some medical business loans, you receive a discount if you pay your balance in full before it’s due.
Great for Building Credit
A business loan for doctors 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.
Business Loans for Doctors Cons
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.
Have High 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 high 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.
What is a Business Loan for Doctors?
A business loan for doctors provides the capital you need to:
- Open a medical practice
- Maintain cash flow until insurance companies reimburse you
- Hire additional staff
- Purchase medical equipment
Business Loans for Doctors Companies
Ready to get the cash to help you launch or grow your medical business? Start with these financing partners.
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.
How to Qualify for a Business Loan for Doctors
While requirements will vary from lender to lender, generally, you’ll need to be in business two or more years and have annual revenues of $120,000 to qualify for a business loan for doctors.
Best Uses for a Business Loan for Doctors
As long as you’re using your 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 to 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.
Alternatives to Business Loans for Doctors
There are several financing tools to consider to help move your medical practice along.
If you quaify, 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.
While many banks offer SBA loans, some offer their own financial products. 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 get when you need them rather than a lump sum you immediately have to start paying back, consider a line of credit.
If you need to purchase medical equipment, there are specific equipment loans to help you. The equipment you’re purchasing is the collateral to secure the loan, which may qualify you for a lower interest rate.
Nav’s Verdict: Business Loans for Doctors
Opening and running a medical facility, while potentially lucrative, can be costly. Having the right financing solution can ensure that cash flows steadily and you can take advantage of opportunities for growth.
- SBA Loans
- Traditional Bank Loans
- Merchant Cash Advance
- Micro Loans
- Cash Flow Loans
- Alternative Online Loans
- Construction Business Loans
- Retail Business Loans
- Restaurant Financing Options