3 Alternative Lending Options for Medical Practices
As a medical professional, your financing needs can vary considerably from other businesses. One thing that especially works in your favor is your high potential to earn an excellent income. If you’re looking for options outside of the typical bank loan, we encourage you to consider the three alternative types of medical practice financing below.
Practice Acquisition Loans
Of all the expenses that medical professionals incur when starting a business, obtaining their first practice is typically the largest one. However, it’s also a cost that you need to tackle first since you can’t serve patients unless you have the physical space to do so. Some banks offer special acquisition loans as an overall medical practice financing strategy. This will enable you to purchase property and set up your practice before investing in the specific equipment that you need.
Small Business Administration (SBA) Loans
The SBA works with borrowers to encourage them to approve more business loans for people desiring to start any type of business. Although the SBA isn’t a direct lender, it backs the loans or offers other incentives to bankers to approve business loans. SBA loans typically have lower interest rates and more generous repayment terms than other types of medical practice financing loans. If the SBA is willing to attach its name to your loan, there’s a much better chance a banker will approve it rather than if you approached the bank for a loan yourself.
Working Capital Advance
When you already have most of your medical practice financing in place but still need funds to cover such things as payroll and equipment purchases, a working capital advance can make a good solution. This requires you to sell one or more unpaid invoices from your best customers to a third-party financing company in exchange for immediate cash. The company holds out a percentage of the invoice for its fee and your customer then pays it directly.
Fintrus is happy to help you explore these and other medical practice financing options. Just contact us today to learn more.