Dental practice loans explained

How we handle this page: no practice lender pays us. We looked for referral programs for dental practice loans and didn’t find any we’d join, so there are no paid links and no pick here. The lenders below are named because dentists commonly use them, with facts taken from their own sites.

A practice loan is a business loan, not a student loan. It has no income-driven plans, no forgiveness and no federal forbearance. You’ll usually personally guarantee it.

The five types of practice loans

Type	What it pays for	Typical structure to ask about
Acquisition	Buying an existing practice: goodwill, equipment, patient records, often some working capital	Term loan; SBA 7(a) or conventional
Startup	Build-out, equipment and months of payroll before a new office breaks even	Term loan, sometimes with an interest-only period
Equipment	Chairs, imaging, CBCT, scanners	Shorter term tied to the equipment’s life
Working capital	Payroll, supplies and bills while collections ramp up	Line of credit you draw and repay
Real estate	Buying or building the office	Longer term; SBA 504 or 7(a), or a commercial mortgage

Many deals combine two or three. An acquisition loan may include working capital and equipment; the building is often financed separately.

SBA 7(a) and 504 (as of September 2026)

The SBA doesn’t usually lend the money itself. It guarantees part of a bank’s loan, which can make a lender willing to do a deal it otherwise wouldn’t.

7(a) is the all-purpose program. Per the SBA:

• Uses include changes of ownership, working capital, equipment, real estate and refinancing business debt.
• The maximum is $5 million.
• Maturity is 10 years or less, unless the loan finances real estate or equipment with a longer useful life. Real estate can run up to 25 years.
• The SBA caps variable rates at a base rate plus a spread. Above $350,000, the cap is base rate plus 3.0%. Smaller loans allow more.
• The SBA guarantees 85% of loans of $150,000 or less and up to 75% above that. Lenders pay an upfront guaranty fee; ask whether it’s passed on to you.

504 is for long-term fixed assets. Per the SBA:

• It finances buying, building or renovating real estate, and long-life equipment (at least 10 years of useful life).
• It can’t be used for working capital or inventory.
• SBA’s 504 page lists a $5.5 million maximum. The SOP limits most businesses to $5 million, with $5.5 million for manufacturers and certain energy projects. For a dental office, plan on $5 million. Maturities are 10, 20 or 25 years.
• The rate is pegged to 10-year U.S. Treasury rates. Fees total about 3% of the debt.

New rules start Oct. 1, 2026. SBA’s SOP 50 10 8.1 applies to loans numbered on or after that date and moves change-of-ownership rules into a new appendix. If you’re buying a practice, see buying a practice with student loans for the down payment and cash-flow rules lenders describe.

Specialist dental lenders (from their own sites, as of Sept. 26, 2026)

• Bank of America Practice Solutions finances startups, expansions, acquisitions, equipment, commercial real estate and multi-practice owners. It advertises “up to 100% financing” depending on loan type, working capital with startup and acquisition loans, and rate locks. Members of endorsing dental associations get 50% off administration fees on a funded loan. “All programs subject to credit approval.”
• Live Oak Bank says it has financed over $1.5 billion in dental practice loans, for expansion, construction, commercial real estate and other purposes. Its healthcare team also makes SBA loans to dentists.
• Provide, a division of Fifth Third Bank, lists acquisition, startup, equipment, refinance, commercial real estate, construction and SBA loans. For acquisitions it advertises “up to 100% financing” and “six months of interest-only payments.” It says pre-qualification doesn’t affect your credit score.

These are advertised features, not offers. Your terms depend on the deal, your credit and the lender’s review.

“Up to 100% financing” doesn’t mean no cash is needed. SBA acquisition loans have their own down payment rules, and you’ll still want reserves.

What lenders look at

Lenders weigh the deal and you:

• The practice’s cash flow. Tax returns, collections history, overhead and whether the numbers support the payments with room to spare.
• Your production. Can you produce what the practice needs? Associate production reports help.
• Your credit. A clean payment history, including student loans. Student debt alone doesn’t rule you out; see buying with student loans.
• Your cash. Down payment where required, plus reserves.
• The transition. Will the seller stay on for a while? Is the staff staying? On an SBA acquisition loan under the new SOP, the seller can only stay as a consultant, for up to 24 months.

The math: what rate and structure cost

Example: $700,000 at 8.0% fixed APR over 10 years is about $8,490 a month and $1.02 million in total. At 9.0% fixed APR, it’s about $8,870 a month and $1.06 million. Examples, not offers; your rate and term depend on the lender and the deal.

That one point costs about $375 a month and $45,000 over the loan.

Interest-only periods help cash flow early but aren’t free. On the same $700,000 at 8.0% fixed APR, six interest-only months run about $4,670 a month. If the loan still ends in 10 years, the payment then rises to about $8,790 for the remaining 114 months. Total paid is about $1.03 million. Example, not an offer.

Also ask whether the rate is fixed or variable. SBA 7(a) caps are written as a spread over a base rate, so a variable-rate loan’s payment can rise.

Questions to ask every lender

1. Is the rate fixed or variable? If variable, what index, what spread, and how often does it adjust?
2. What’s the term, and is there an interest-only period?
3. What fees apply: origination, packaging, SBA guaranty fee, appraisal, legal?
4. Is there a prepayment penalty?
5. How much down payment and cash reserve do you require for this deal?
6. What personal guarantee and collateral, including your home, do you require?
7. How do you count my student loan payment?
8. Is working capital included, and how much?
9. Do you require life or disability insurance assigned to the loan?
10. How long from application to closing?

Get each answer in writing so you can compare them side by side.

Who should slow down

If a lender approves more than the practice’s cash flow comfortably supports, that’s the lender’s risk tolerance, not a reason to borrow it. If you’re counting on a lower student loan payment to make the numbers work, reread when refinancing is a mistake first.

What to do next

1. Get your personal side ready: credit report, student loan plan, cash for a down payment. See buying a practice with student loans.
2. Talk to lenders early, before a letter of intent. Ask the 10 questions above.
3. Compare at least three quotes, including one SBA lender.
4. Set up your entity in the lender’s required name. See entity setup.
5. Plan the first year’s cash: payroll and bookkeeping before your first deposit.