Are you a medical practitioner looking to get a loan?
Doctors have to go through a lot during and after school because of the high costs that come with med school. This can leave them wondering what they should do to pay for school and other necessities.
Fortunately, many banks and loan services have started offering services that allow those that work in healthcare to borrow money without putting them in a hole.
Read on to learn about medical practice loans and financing options for doctors.
1. SBA Loan
An SBA loan is what many small business owners use when they’re starting their businesses. They’re one of the most popular loans because they’re guaranteed by the US Small Business Association.
One variant of the loan is the SBA 7(a), which have low interest rates and let borrowers repay over a long duration. While these loans are flexible, they’re usually sought after by many people, making them difficult to get.
When a person applies for this type of loan, they’ll need to have a high credit score and proof of a steady income. Doctors are the perfect candidates for SBA loans because they usually have a great credit score on top of a well-paying job.
However, you might have to look elsewhere if you need a quick loan. The SBA 7(a) requires a lot of paperwork that can delay the process—especially if you don’t have your financial records on hand.
2. Medical Practice Loan from Bank
When people seek medical practice financing, they often go straight to banks for a loan. Luckily, there are loans you can get that are designed for people going into the medical field.
You can get a Wells Fargo physician loan that caters to the likes of doctors, veterinarians, and other healthcare practitioners. These loans allow you to work directly with a lender to find an option that will suit you.
The downside to these loans is that, similar to an SBA loan, a borrower has to have an excellent credit score. Any missed payments in the past will be red flags to the bank, so ensure that your records are clean before applying.
3. Term Loan
A term loan is what many people think of when they think of loans. In this case, a medical practitioner would receive a loan from a lender that specialized in medical financing, and the practitioner would pay it back over time with interest.
Depending on the needs of a practitioner, a lender will decide how much money they’d be willing to lend and set the repayment term. These loans are different than bank loans because they come from alternative lenders.
Term loans are also often easier to get than bank loans because they’re not as strict in terms of credit score and financial history. While these loans are easier to get, they sometimes come with larger interests to balance their easy access.
4. Short-Term Loan
Short-term loans are the best medical loans for those that need to get money quickly. They have higher interest rates and shorter repayment periods than SBA and term loans, but they have quick funding processes.
This is a good option for those that earn an income that will allow them to quickly pay a loan, and for those that don’t want to have debt hanging over their heads. Just be aware that these loans aren’t specifically catered to medical practitioners.
5. Business Line of Credit
A business line of credit is a reliable alternative to a loan for doctors. Similar to credit cards, a lender will approve you a credit amount that you can access at any time. Even if you don’t use the funds for a while, they’ll still be accessible.
You also don’t have to pay any interest if you don’t borrow any funds. If a lender approves you $10,000 of credit but you only use $5,000, you’d only have to pay interest on that $5,000. You’ll still be able to access the other half at any point
After paying your funds back, you’ll be able to borrow again. This benefits those that plan on borrowing over several semesters because they can get replenished credit each time.
6. Medico Home Loan
For doctors and healthcare specialists that would like to take out a home loan, a medico loan will let you do just that. These loans are designed for those in the healthcare field and provide several benefits.
A medico home loan will let you waive lender mortgage insurance, pay interest at a discounted rate, and have a higher borrow limit because of your income.
These loans can be taken out by the likes of surgeons, dentists, psychiatrists, and even veterinarians. You can also get a medico home loan if you’re a self-employed doctor, providing that you’re financially stable.
Take Advantage of These Medical Practice Loans
While taking out medical practice loans or getting a line of credit can seem like a daunting task, it’s not as hard as it seems. Doctors have the benefit of receiving high income that backs their financial statuses up, making them trusted by most lenders.
There are several options for you depending on what type of loan you’d like and the amount of money you need. Decide which would be the best for you and start researching local and online lenders to take advantage of your options.
Feel free to browse our financial section to read more articles about finances that target people in the healthcare industry.