November 7, 2022
How a Dental Practice Broker Can Help with the Pre-qualification Loan Process
As if starting a new dental practice isn’t overwhelming enough. Whether you’re just out of dental school and trying to juggle student loans or transitioning ownership after years of practicing, it’s easy to get lost in the weeds leading up to the pre-qualification process for a business loan. That’s where a dental practice broker comes in. Here’s how a dental practice broker can hold your hand throughout the pre-qualification process.
Know where to start
The harsh reality is that the average dental student will graduate with $570K in debt. Rather than starting as an associate or even working for a dental service organization (DSO) after graduating with a negative net worth, the fastest way to make dentistry worth it is through practice ownership. Though counterintuitive, taking on more debt will pay off. A dental practice broker will help ensure your investment is typically paid back within eight years of practice.
Ask the right questions
Applying for any type of loan has its challenges, never mind a loan to start a dental practice. And with any new ventures, there are a lot of unknowns with which come a set of questions. A dental practice broker will help point you in the right direction when it comes to knowing if you’ll qualify for a dental practice loan, which banks to approach and how they differ, and ways to ensure you’ll be approved.
Get a better deal
There’s room for negotiation in every step of the dental-practice-buying process, including when shopping for a business loan. A low-interest rate, low fees, favorable payment schedule, and flexible or no-collateral security will all significantly enhance the benefits of your business loan. A dental practice broker will help you get a better deal on your business loan when purchasing a dental practice, including shopping for the best options and choosing the type of lender.
Know what to look for
A dental practice broker knows a relationship has to work both ways when it comes to working with a lender. Not only will you want to work with the lender you feel most comfortable and not necessarily who offers the lowest price for their services, but a lender will likewise be selective when looking to award your practice a loan. Your lender should have a strong understanding of the industry, as well as the ability to judge high-quality practices.
Know your numbers
Above all, it’s important to know where you stand financially. Surprisingly, personal debt doesn’t weigh much into the bank’s decision of lending to dentists, but you’ll still want to have a strong history of making payments on time and be aware of your credit score. Part of knowing where you stand is working with a proper team to get all your paperwork lined up. A dental practice broker works with a network of dental-specific advisors who can help navigate the process leading up to a smooth transition to dental practice ownership.
Contact the experts at Professional Transition Strategies for more ways to navigate dental practice ownership throughout the process.