Medical Working Capital Loans

Written by Jill Morrison
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Physicians seeking to expand their practice may need to consider medical working capital loans. The costs of running a medical office may cause periodic cash flow problems that interfere with the ability to provide service. Equipment needs, payroll, expansion, and personal needs are examples of uses for this type of loan.

Description of Medical Working Capital Loans

These loans are usually short term, sometimes for one selling season or up to one year. Unsecured loans often require that they be paid off for 30 to 60 days and then be reestablished. By doing this, lenders are satisfied that the loan is not part of the equity structure of the business. Therefore, the approval process is less strict.

Medical working capital loans are available with terms up to 20 years amortization. Interest rates may be fixed or adjustable and depend upon gross sales, amount of time in business, and business credit. Many lenders offer fast approvals within one to three days. The application process is short and the funds may be used for any purpose. Typically, lenders will need to see a financial statement for the business and two years of tax returns. Some require a business plan and cash flow projections. Programs are available for medical professionals with damaged credit.

Lenders understand that physicians have unique needs and concerns. Expert advice is available about medical working capital loans and other financing solutions. Acquiring an existing practice, starting a new practice, and buying or leasing new and used medical equipment are all transactions that require individualized attention to produce optimal results.


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