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Dental Practice and Equipment Financing Options in 2020

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Dental practice and equipment financing can be a challenge for new and experienced dentists alike. Whether you’re starting, buying, building, or upgrading your practice, you may need to borrow hundreds of thousands of dollars. Fortunately, lenders offer large loans with favorable terms to dentists based on the industry’s reputation for repaying loans on time. 

Dental Financing for 2020

Dentists may look for financing for several reasons. There’s financing for a new dental practice, which could mean starting a brand-new office or purchasing an existing office. Then, there are dentists who have a practice and need to take out a loan or line of credit for a different reason. 

“Every dentist has unique needs and comes to us at different points in their careers; they may be ready to expand their practice, want to invest in new equipment, need an injection of cash flow, or need some relief from debt,” says Zach Raus, the president of lending at Bankers Healthcare Group (BHG), which specializes in financing for healthcare professionals. 

The reason you’re applying for financing can determine which type of loan may be best. For example, a Small Business Administration (SBA) can be a good fit when you’re opening a new practice and need to purchase or lease property. But a line of credit could be a better fit if you’re struggling with cash flow while waiting for payments from insurance providers. 

No matter the situation, you’ll want to compare several lenders to find the one that offers the best rates and terms. 

Options for Dental Practice Loans

Nav partners with leading small business lenders that provide general business and equipment loans to dentists and other small business owners. We’re listing some of these lenders below, as they may offer loans or lines of credit you can use to help run your business. We’re also highlighting several lenders that have specialized medical or dental practice loans.

Bankers Healthcare Group

Bankers Healthcare Group works with medical professionals in several fields, including dentistry. It offers business term loans to existing businesses for up to $500,000 without a personal credit check or personal collateral. Raus says, “Dentists primarily get business loans from BHG for business development, debt consolidation, and practice improvements, such as new technology or equipment.” 

BlueVine

BlueVine is an online lender that offers installment loans, lines of credit, and invoice factoring. Factoring generally only applies to B2B business, which doesn’t include dental offices. However, a term loan or line of credit could help with more general business financing needs. BlueVine requires a general lien and personal guarantee from business owners for either type of account. 

Currency

Currency’s online equipment financing offers up to $2M in funding. Depending on your creditworthiness, you may qualify for a low interest rate and no origination fee. After submitting an application online, you can quickly compare options on Currency’s webiste. But, it can take a week or two to receive the funding.

SmartBiz

SmartBiz offers online bank loans, SBA loans, and financing from non-bank lenders. The wide variety of options means you may be able to find a type of financing and offer that suits your needs, although the company doesn’t specifically work with healthcare professionals. 

Traditional Banks’ Healthcare Practice Groups

Traditional banks, including Bank of America, PNC, US Bank, and Wells Fargo, have a special financing department for dentists and other healthcare providers. Working with an experienced banker can be beneficial as they’ve seen what’s worked (and hasn’t) for other dentists and can act as an advisor. Some banks also partner with the ADA to offer lower fees and additional resources to dentists. 

How to Qualify for Dental Practice Financing

Lenders can set their own underwriting requirements, and they may vary depending on the type of financing you’re looking for and your plan for the money. If you’re looking for significant funding to start, buy, or expand your business, you may need to:

  • Form a business entity, such as a limited liability company or corporation
  • Have a business plan that you can share with the lender if you’re buying or starting a new practice
  • Have a history of paying personal debts on time. A personal credit score around 720 or higher can be important for getting good rates, although you can find financing with a lower credit score.

Many dentists have several hundred thousand dollars in student loans, which may impact your ability to qualify for financing with a general business lender. However, lenders that have experience working with dentists understand that that’s the norm and may ignore the loan balance and focus on your payment history instead. 

Having a history of paying all your bills on time, and having enough savings to cover short-term emergencies, can go a long way toward qualifying for dental practice loans. With a strong track record, you may even be able to qualify for a large equipment or practice loan without putting any money down or paying an origination fee. 

Dental Financing Use Cases

Start a New Dental Practice 

If you plan on building your practice from the ground up, you may want to look for a graduated loan. These start with low or interest-only payments, which limit your expenses during the initial construction and opening phases Some creditors will also release loan disbursements over time, either to you or by directly paying your contractors progress payments, which can limit how much interest you have to pay. 

Acquire a Dental Practice 

Purchasing a practice rather than building your own comes with pros and cons. You’ll have immediate cash flow if clients may stick with the practice. However, you’ll also inherent potential shortcomings with the staff, equipment, systems, and setup. You may want to look for a loan that covers renovations or equipment upgrades in addition to the purchase price. 

Get More Working Capital

If you’re already running a dental office, you might need financing to help with cash flow or during a slow business period. In these cases, an online lender that offers quick financing may be a good option. 

Finance Dental Equipment 

Equipment loans can be easier to get than general practice loans as you’ll often use the equipment as collateral for the loan. Specific equipment loans might not be amortized like standard business loans, meaning the loan amount includes the financing charge. In these cases, paying off the loan early won’t save you money because interest isn’t accruing over time. However, some lenders may offer a discount if you can repay the loan in full ahead of schedule.

You could take out a loan to buy equipment, or use a lease to rent the equipment. Raus says what’s best depends on the equipment’s cost, maintenance, and the overall impact on your bottom line. “If the equipment you want is going to make your practice more profitable and efficient over the long term, it probably makes sense to purchase it outright with a loan,” he says. Otherwise, leasing may be a better option. 

Replace Office Equipment

Office equipment won’t be as expensive as medical equipment, and you could compare a wider range of loan options if you’re looking to upgrade your office’s computers and printers. A simple, online loan might provide the most straightforward financing. If you’re already working with a lender, you could ask about options for expanding the relationship to upgrade or replace your office equipment. 

Invest in Dental Software

From practice management software (PMS) to general accounting and payroll services, your technology needs can change as your practice grows. Involve your whole team with the purchase, and make sure new software will work with your existing setup. Financing can come into play to help pay for the software itself, and you may want to set money aside for training. If you’re changing accounting software, you may need to hire an accountant or bookkeeper to move your books over to the new system. 

Is it Possible to Qualify for Dental Practice or Equipment Financing with Bad Credit?

Your personal and business credit will likely be a factor in qualifying for a dental practice loan. However, bad credit won’t necessarily rule you out — it depends on why your credit is bad and the lender. 

“If a dentist has bad credit, they should first seek to understand a lender’s approval requirements and how they work with borrowers in their position,” says Raus. “Qualification isn’t solely based on credit, but it’s definitely a part of a borrower’s profile.”

You can look for ways to improve your credit before applying. Or, if you have an immediate need for financing, you may need to take out a loan with less favorable terms. Then, after improving your credit and business’s finances, you may be able to qualify for a lower-rate loan and use the money to refinance your debt.

How Many Years Can You Finance Dental Equipment?

The repayment terms of your loan can vary greatly depending on the type of financing you’re using to purchase equipment. If you take out an equipment loan, you may have several months to 10 years to repay the loan. But larger practice loans, particularly those that will cover commercial real estate in addition to equipment, could have much longer terms of up to 15 or 25 years. 

The longer your repayment term, the lower your monthly payment. However, a longer term also means more interest can accrue, which increases your overall cost of financing. Some lenders may allow you to repay a loan early without paying a prepayment fee, but longer-term loans could still have higher interest rates. 

Nav’s Final Word: Dental Practice Financing 

Opening and running a dental office can be a capital-intensive process. It can take several hundred thousand dollars to get started, in addition to the student loans you took on to become a dentist. However, many dentists are able to build a practice, repay all their debt, and build significant wealth over their lifetime.

When you’re looking for funding, having the right team can be important. You may want to hire an accountant and financial planner who has experience with dentists in your area, and find a lender that can act as a partner (although, don’t forget their bias). You can also reach out to other dentists or classmates and ask about their experience with different lenders. 

Also, try to match the type of financing to your need. “Dentists are strapped for time; it’s hard for them to get out of the office during regular business hours,” says Raus. “We also find that they need to get their financing fast, especially if they’re using the money to purchase new equipment.”

A bank loan may be best for a large project, but it can take weeks or months to get approved. Online lenders can offer quick and easy financing for smaller projects or when you need working capital. 

 

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Miracles in a tough season

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Harry Hines Boulevard in northwest Dallas is a “track,” a place where prostitution is, at least in normal times, visible and available. It’s a wide, treeless expanse of concrete, low-slung buildings, and neon signs. On a Saturday in early August, a nearly full moon glowed in the southeastern sky. A couple of strip clubs had reopened and, judging from the parking lots, were doing good business. Outside of one, a doorman stood wearing a surgical mask. 

The pandemic hurt strip clubs like those on Harry Hines Boulevard, and it also put a crimp on prostitution generally. The Dallas Police Department (DPD) reported that cases of johns “purchasing prostitution” dropped 63 percent during the first half of 2020 compared with the same period in 2019. Human trafficking reports dropped by 39 percent. “COVID has definitely had an impact,” said Maj. John Madison of DPD’s vice unit.

But the pandemic effect has not been all good. Harmony Grillo, founder of Treasures, a California-based ministry to sex trafficking victims, said traffickers are forcing some women to do more porn webcamming “to meet the increased demand that’s created by those in quarantine.” Carol Wiley, director of A Way Out, a similar program in Tennessee, said fewer johns may be renting women face to face, but she fears that “violence toward the women [by traffickers] increases.” 

Some of the heaviest and least-anticipated impacts of the pandemic have fallen on victims of sex trafficking who had already escaped the life. One such victim—call her Ava, because she has legitimate fear of her trafficker tracking her down—was recovering from three years of being sex trafficked when the pandemic hit.

Ava, 24, escaped her trafficker in 2018. She built a relationship with God and overcame deep-rooted social anxieties. But the pandemic shutdown took away much of the community she had built since escaping prostitution. In-person worship services at her church in Fort Worth stopped. Small groups she attended on issues from emotional support to financial coaching could no longer meet.

Ava was living in a house run by Valiant Hearts, a Texas-based group that helps women escape the sex industry. As the pandemic lockdown continued, house parent Tiffany Kiser noticed that Ava had lost the optimism she’d gained since being in the program. She stayed in her room and refused to talk about what was bothering her. 

In normal times, Valiant Hearts provides women with choices, something victims lose when they are trafficked: To appear controlling risks having a victim equate you with her trafficker. But Ava was at a critical point in her healing, one that called for an unorthodox approach. Kiser and Emily Chavez, Valiant Hearts’ program director, demanded that Ava sit down with them. When she did, her hands shook and her face looked as if a year and a half of therapy had completely unwound. Ava said she couldn’t explain how she felt or why. “Just start talking,” Chavez said.

SEX TRAFFICKING IS A LARGE, sophisticated, underground economy, with its own networks, business models, and jargon. Criminals like the one who trafficked Ava are the successful entrepreneurs of the industry. They own multiple homes and drive expensive cars. At any one time, they may control dozens of prostitutes, sometimes trading them with affiliated traffickers in other parts of the country. They diversify across every segment of the market, from prostitution conducted along streets to discreet, “agency-­level” procurement deals for wealthy and prominent johns who shield themselves behind third parties. 

Ava’s trafficker controlled 30 women of different ethnicities, shapes, and hairstyles. He used a combination of charm, coercion, and physical assault to keep them in line. One night after a birthday party for one of the women, police responded to a call about an attempted robbery and shooting. When the police saw so many women and only one man in the house, the officers became suspicious—but could find no grounds to arrest anyone.

The next day, one of the women told Ava she wasn’t feeling well and needed to go to the hospital. Ava loaned her a cell phone so she could call for a ride home. Ava never saw the phone again. At the hospital, the woman told authorities her real problem: She was being trafficked and needed help. The phone became evidence in the case against the trafficker. 

Six months later, police raided the house where Ava lived, arresting her, the other women, and the trafficker. Since she was recovering from invasive cosmetic surgery, police placed her in a segregated cell as a protection against infection. There she remained for six weeks: “It was the first time that my brain had freedom to think the way it wanted to.”

“It was the first time that my brain had freedom to think the way it wanted to.”

In jail, Ava began asking God to show her if He was real. He opened her eyes to see her situation: The trafficker claimed to care about her while beating her and crushing her sense of self-worth. One day as she lay on the skimpy jail mattress, a letter arrived from a friend. It contained a Bible verse, Jeremiah 29:11—“For I know the plans I have for you, says the Lord. Plans to prosper you and to harm you.”

Ava wasn’t sure what to make of it. Were there plans to harm her? She looked the verse up, and realized her friend had miscopied it. The actual verse reads “… not to harm you.” In that moment, she realized if she stayed with her trafficker she might share with her trafficker some of the affluent, glamorous life he portrayed to the world, but there would be harm. 

She decided to take her life away from her trafficker and give it to God.

When she met with her lawyer, she pleaded to find a place where she could learn how “to be human.” That’s how she ended up at Valiant Hearts. Ava was baptized a year ago. Photos from after the service show Ava’s face stuck in a smile that, as she described it, almost covered her eyes.

Ava’s battle was not over. She had to sort through years of emotional damage. For three months after moving into the Valiant Hearts house, she was afraid to leave, only going to church or with others to the grocery store. She also had to unravel a financial and legal mess. Sex traffickers bind and exploit victims by using their identities to open businesses and bank accounts for laundering money. Ava learned about a house in California deeded in her name.

“It’s very strategically planned out,” Chavez said, “so that nothing ties back to [the trafficker]. And when the ladies come out … they have debt, tax evasion, criminal histories, bad credit, and bad relationships with banks.” Ava’s credit score was “about as low as it could get.” Banks turned her down five times for a checking account before she got one through a connection to someone who owned a bank.

WHEN THE PANDEMIC HIT and Ava withdrew, Chavez was worried. She demanded that Ava “just start talking.” 

It started with tears, and what Ava later described as “word vomiting.” She began to see how in the absence of healthy routines and regular worship, she had fallen into old patterns of thought dictated by her trafficker: She’d never amount to anything, never be anything but a prostitute. Ava began to realize the extent to which the pandemic had become a trigger, but one she could counter with skills she had already learned in counseling. 

Since then Ava has made progress. She’s completed the Valiant Hearts program. With her legal troubles mostly behind her, she is moving into her own apartment. She has a job with Savhera, a company that provides employment to victims of sexual exploitation. She is also starting college and has a 10-year plan to get a Ph.D. in clinical psychology, so she can “help more survivors like myself get deeper healing and understanding.”

“This will be the first time I’ve lived on my own literally my entire life. Woo-hooo! The Lord has shown off in this season, really showing miracles. But it’s also been a really tough season.”  

—Paul McDonnold is a graduate of the World Journalism Institute mid-career course



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Warner Robins GA Credit Repair Finance Score Improvement Service Launched

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New credit repair services have been launched by the expert team at Fresh Start Consumer Services. They work with clients in Warner Robins, GA and the surrounding areas.

New credit repair services have been launched by the expert team at Fresh Start Consumer Services. They work with clients in Warner Robins, GA and the surrounding areas.

Fresh Start Consumer Services has launched a new credit repair service for clients looking to improve their financial future. Interested parties can sign up for credit consultations, in-depth credit analysis, credit recommendations and more.

Full details can be found at: https://freshstartconsumerservices.com/index.html

The newly launched services are designed to ensure clients can repair bad financial credit history, track their improvement campaign in measurable ways, and secure a better future for themselves and their family.

Clients can work with Fresh Start Consumer Services to clean up their past. This is achieved by working with the major credit bureaus and creditors to challenge the negative report items that affect the credit score.

Based in Warner Robins, GA, the expert team at Fresh Start Consumer Services is passionate about helping citizens to improve their credit score to give them more buying power. As a result of this, clients are able to secure more options in life.

The team understands that sometimes bad things happen to good people, and their services are designed to ensure that clients can get the most out of life. They also realize that a bad credit score can harm clients’ quality of life – and can be a difficult situation to get out of.

Fresh Start Consumer Services offer courses in credit repair and restoration, budget management, credit education and purchase assistance. Clients get easy access to their account 24/7 for live status updates on improvements, allowing them to fine-tune the management of their credit score.

Service options include personalized dispute options to fit each clients’ exact credit repair needs, an experienced case analyst and case advisor working personally with them throughout the process, custom dispute letters, and more.

For clients, there are a number of reasons to work with a credit repair specialist. Clients are able to secure significant savings on interest rates, attain better terms on loan products, and get access to the best credit card deals. They also gain access to more housing options.

The team states: “Fresh Start Consumer Services offers a unique combination of services that gives our clients the quality of life they deserve. We specialize in helping our clients achieve qualifying credit and the financial health they desire.”

Full details can be found on the URL above.

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Is it Possible to Trade In a Car Early?

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Yes, early trade-ins are possible when you finance a vehicle. In fact, there’s no set time frame on trading in a car. Most dealers won’t take a trade-in that’s too fresh, though, and it’s best to wait until there’s equity in your vehicle before you try to trade it in.

What’s a Trade-In?

When you trade in a car, you’re essentially selling it to a dealership and financing something else from their lot, without the hassle of selling and buying with separate transactions. There are no hard-and-fast rules about how and where you have to trade in your vehicle.

However, it’s beneficial to shop around and see which dealers can give you the best price, but you shouldn’t just head to a car lot and ask what they’re willing to offer you. When the time comes, there are several steps you may want to take to get ready for the trade-in process, especially if you’re looking to trade in early before you’ve had the chance to close the equity gap.

Trading In Early and Equity

Are Early Trade-Ins Possible When You Finance a Car?When you’re trading in a vehicle soon after you’ve financed it, you’re more likely to be in a negative equity position – owing more on your auto loan than the car is worth.

This is especially true if you financed a new vehicle, or a certified pre-owned car. Newer vehicles depreciate faster than used ones, which have typically already seen their biggest drop in value.

Depreciation is the loss of value over time and it can’t be stopped. It can be slowed, though. The best way to do this is by using a large down payment when you finance. This reduces the amount you have to borrow, and leaves you owing a price closer to what the car might cost after you drive it off the lot. New vehicles typically lose around 10% of their value as soon as they touch the road.

If you don’t have the equity to recoup your investment in a car, you have to make up that difference out of your own pocket. It’s much easier to trade in a vehicle that can pay for itself, but this isn’t always possible when you’re trying to do so early.

Preparing Your Early Trade-In

When you know that you’re starting with a deficit on your trade-in, it’s a good idea to be prepared to get the most you can. Clean the car thoroughly, both inside and out, and make sure to fix any minor damage that may have occurred in the short time since you took out your loan.

Getting the vehicle detailed and fixing major mechanical issues isn’t likely to result in a worthwhile increase to the cash in your pocket, so don’t go overboard. Remember, you want to make as much money on this trade as you can, and it’s probably cheaper for the dealership to fix any large issues.

Before you set foot in a dealer to get your trade-in appraised, it’s a good idea to know approximately how much your car is worth. You can find this out by going to online valuation sites such as Kelley Blue Book or NADAguides. Be sure to be honest when you’re inputting information, since it’s the only way to get an accurate estimate of possible value.

Shopping for Trade-In Values

Once you have the estimates (which you should print or save to your phone), it’s time to take your trade-in to get looked at. Taking it to a few different dealerships is a good way to find the best deal you can.

We recommend taking your early trade-in to at least three different dealers, making sure at least one of them is a franchised dealership that sells your vehicle’s brand. A franchised dealer that sells your car’s brand may be more likely to offer a higher price.

Depending on your credit situation, it’s likely a good idea to ensure you’re trying to trade in your vehicle to a dealership that can work with your situation, especially if you have poor credit. And that’s where Auto Credit Express can come in handy.

We have a nationwide network of special finance dealers that are signed up with subprime lenders who can help people in many different types of credit situations, including bad credit, no credit, and even bankruptcy.

The process is easy to get started – just fill out our free auto loan request form. We’ll match you to a local dealership that can get you started on the financing you need after your early trade-in.

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