Banks Ready to Finance Practice Transition Buyers

A couple of years ago, in 2010, banks that financed buyers in a practice transition, tightened their credit requirements.  They began requiring dentists to be out of school for at least 2 years, they would only finance up to 80% of the last 12 months’ production or they would require the seller to take a note back for part of the loan.  In addition, they would absolutely not finance a new dental school graduate and many wouldn’t even do a dental practice startup.  Rates were up around 7% or higher.

It was a rough year for sellers looking to do a practice transition or sale and also tough on practice sales for practice transition brokers.  Practice sales were completely in the tank.

Fast forward to 2012, bank rates are as low as 5.25% and most around 5.75% to 6%.  They will finance up to 85% of the dental practices’ last 12 months of production and typically no longer require the seller to take a note back.  In addition, they’ll even finance dental real estate purchases if the real estate is available at a great rate.  If you’re in the market, or on finance to buy a practice, or think you can’t sell your practice because banks are not financing practice sales, think again.

Banks are back on the field of play and ready to loan you money so get in the game!