Starting Up Your Own Dental Clinic: 3 Ways To Expedite Dental Practice Debt Consolidation Loan Approval
After finally making it through the grueling years of dental school, you've finally graduated and are ready to start up your own practice to fulfill your dreams of making this world a better place one smile at a time. Unfortunately, you'll find that the average cost of starting a dental practice is about $500,000. This merely includes the cost for all of the dental equipment, supplies and structural uplift. You still have to pay your staff. For the next several years, you'll probably be in debt and will need a strong balance sheet and financial plan to get your clinic out of the red. Your best bet at paying off all the loans is to apply for a dental practice debt consolidation loan. Here are 3 tips that will help expedite the loan approval to potentially avoid an otherwise embarrassing outcome.
Have a Detailed Business Plan that Includes Demographics and Competitor Analysis
When starting up a dental clinic, you should always draft up a detailed business plan for not only the loan company, but for yourself as well. The debt consolidation company needs to be confident that your dental clinic will likely be successful before approving your loan.
Your business plan should include financial information, such as the estimated cost of real estate, labor and dental equipment, and details regarding the demographics of patients you'll target. For example, determine whether your start-up dental practice will be located in a highly populated area. It's important to also determine whether there are any competing dental clinics nearby. For example, there are approximately 48 dentists in Louisiana and 81.2 dentists per 100,000 population in New Jersey. Determine whether there is an excess or an insufficient amount of dental practices in your city. If there is an insufficient amount, you're in luck; however, if there is an excess, you'll have to explain where your patients will come from. Are you going to target residents nearby or do you already have some patients from working at another dentist's dental clinic? If it's the latter, you'll also need to figure out whether you'll be signing a non-compete agreement when you leave your current clinic.
Other information, like the earning potential of your firm, should also be included with supporting narrative if you have it. For example, determine the type of growth you expect to see as your clinic becomes more established.
Get All Financial Documents In Order
Another common mistake that most start-ups make is not providing all of the financial information that is needed at one-go. If the loan company needs to review your information and request for more documents, the approval of your loan application will be delayed. If you're interested in getting a dental practice debt consolidation loan, sit down with a representative from the loan company to discuss the type of documentation they will need. Prompt delivery of the financial documents needed will say a lot about your character.
You'll likely need to provide information, like your credit score and report, to the loan company. Most loan companies will also want to know whether you have any liquid cash available to deal with emergencies. You'll also have to justify why you're spending the amount you're requesting. For example, top-of-the-line dental chairs cost anywhere from $7,000 to $9,000. In your application, include the chair model and the amount of chairs you'll likely purchase. If you'll be purchasing more expensive models, justify why. For example, your practice might be catering to a more elite crowd that will desire a more luxurious and comfortable experience.
Report changes of your financial situation to the loan company immediately, so that there are no surprises. Don't be careless with your credit score during the time that your loan application is being processed. Make sure that you pay all of your bills on time, so that your credit score does not get impacted. It's also important to determine whether the loan company will take the amount of student loans you have in consideration.
Be Available and Be In Communication with the Lender
Applying for a dental practice debt consolidation loan may look simple, but there's a good chance that the loan company contacts you to further discuss your application. One of the largest mistakes that applicants make is having a lack of communication with the loan company. To show that you are determined and eager to get your practice started, don't hesitate to reach out to the representative handling your loan application.
If you are rather busy as you are currently working in someone else's dental clinic and will not be reachable at all times, you might want to consider hiring an accountant or an attorney to answer all questions and inquiries on your behalf. An experienced dental accountant, attorney or consultant can streamline the process on your behalf.
Before applying for a dental practice consolidation loan, it's important that you fully understand what you'll be getting yourself into. Make sure to take a detailed look at the estimated costs involved with running a dental practice. You'll need to determine the amount of patients your clinic will have to take on in order to get out of the red. If your loan gets approved, it's imperative that you sit down with an accountant or with a representative from the loan company to figure out what the monthly payments will be and to negotiate a reasonable interest rate.