Dental funding priced as clearly as a treatment plan

In depth

Production is not collections

A full schedule shows production. What pays the bills is collections: production minus PPO write-offs, minus patient balances you haven't collected, minus claims still in process. The gap between the 2 can be wide in a PPO-heavy practice.

Funders read your bank deposits, so they see collections, not production. Bring both reports if a funder asks for more than statements, since the difference shows how much is still coming. A collection ratio below what you expect is worth fixing before you borrow, because better collections are the cheapest funding a practice has.

The year-end rush makes this sharper. November and December production can be your strongest of the year, with much of the cash landing in January as claims clear. Openbook Capital asks for 4 months of business bank statements after a short application, and this list of documents covers what else might come up.

Financing a scanner, a mill or an operatory

Equipment financing uses the equipment as collateral, with a fixed payment over its working life. It usually costs less than unsecured funding, and some lenders finance installation along with the hardware. Ask for payments to start when the equipment is installed and running, not when the order is placed.

Manufacturer promotions can be good, but compare the total cost as well as the rate, and check whether the price rises when you finance. A fair market value lease can make sense for technology you expect to replace. Our financing versus leasing guide compares both.

Buying a practice or bringing in a partner

SBA 7(a) loans can fund a change of ownership, complete or partial, along with equipment and working capital. SBA 504 loans finance buildings and long-life equipment but not working capital or inventory. Both take weeks of underwriting, so start well before the closing date. Our SBA guide explains the programs.

Plan for the first months after closing. The seller often keeps the receivables from before the sale, so you may start with a full schedule and a thin bank account while the first claims process. A line of credit set up at closing usually covers that gap more cheaply than an advance taken in a hurry later.

Buying into an existing partnership? Get the buy-sell agreement and the practice's current debts in front of the lender early. Those documents decide what the new loan can cover and what has to be paid off at closing.