Having your own practice is the first step a medical practitioner should make. There is a lot that goes into having your own practice such as operational costs, equipment costs, and more. Medical practitioners should seek medical equipment financing to help overcome the costs.
Medical Equipment Finance Defined
Medical equipment finance is a strategy of buying equipment in installments. This method is a convenient way for medical practitioners to get the equipment they need to run their business. Banks have strict credit standards that would make it difficult for one to qualify. There are now some business lenders that will provide the equipment for those in need even if they do not have great personal and business finances.
How to Qualify for Medical Equipment Financing
Every lender will have different requirements, but the majority of lenders ask for:
- A valid ID (driver’s license or passport)
- Voided business check
- Bank statements
- Credit score
- Business tax returns
- Equipment quote
If your business is still in the startup phase, you may not have established business credit and tax statements. In this case, lenders will probably rely on your personal creditworthiness. You may need to provide personal bank statements and tax returns. When the lender has all the documentation required, approval for funding is quick.
Medical Equipment Finance and Financing Options
- Lease instead of financing: you can rent or lease the equipment you need. You will still make monthly payments like a traditional loan, but you need to return the equipment when you stop.
- Get a bank loan: while some banks are strict, others may not be. Do your research and find out.
- Apply for an SBA loan: SBA loans are popular as they are open to many small businesses. There are some qualifications that you need to meet if you want to apply for an SBA loan.
- Credit card: if you use your credit card appropriately, you can use it to get the equipment you need.
- Get an angel investor: angel investors may be willing to help you out.
- Business line of credit: you can always apply for a business line of credit so that you can borrow up to a certain limit and pay interest on the money that you borrowed.
- Crowdfunding: crowdfunding can help your business if you have people who are willing to invest in you.
Pros of Medical Equipment Finance
There are a few benefits of medical equipment financing:
- Tax advantages: the cost is considered a business expense.
- New opportunities: your chances of getting new opportunities for your business increases.
- Working capital preservation: equipment financing protects you from running out of working capital.
- Improve Accurate Budgeting: there is a fixed interest rate for a specific period which makes it easy to predict business expenses and budget accurately.
- Flexibility: payments are structured to fit your cash flow.
- Scalability: if you need new equipment, financing lets you with them without delay.
- Get a Loan Online: you can apply online making the process quick and smooth.
Cons of Medical Equipment Finance
Although there are many benefits to equipment financing for your medical equipment, there also some cons to keep in mind.
- Down payments: down payments can be extremely high. Because of this, businesses may not be able to maintain a steady payment.
- Credit: you need to have a strong credit score and history. If your score is too low, you will not get approved as you are considered high risk.
The Bottom Line
Medical equipment financing is a realistic strategy that gives practitioners a change to venture into business. Obtaining equipment is possible with medical equipment financing. Before making any decisions, discuss with an expert to see what will help you achieve yo