Medical Practice Finance for Doctors and Dentists

Medical practice finance is commercial lending for buying, buying into or expanding a practice, assessed on the practice's earnings and goodwill instead of the physical assets a home loan relies on.

Because much of a practice's value is goodwill, specialist lenders can secure the loan against the practice and its equipment, so eligible medicos keep the family home out of it. Arranged through a commercial lending broker, the deal is matched to the bank, non-bank and medico-only lenders that write this business.

The premises and the fit-out are funded separately, on their own terms. Where you want to hold the rooms in super, you can hold premises in super as a business-real-property purchase, and buying a pharmacy follows state ownership rules covered on its own page.

How much a lender will fund, and on what terms, depends on the practice's financials, your profession and the structure of the deal, so the numbers are confirmed for your transaction.

Which structure fits, and how much a lender will fund, depends on the practice and the deal, so treat these as a general guide.

What a lender counts and how much it lends vary by lender and deal and can change, so treat these as a general guide.

1. Deal review. We look at the practice, the price and how the purchase fits your wider position.
2. Accountant coordination. Goodwill valuation and structure sit with your accountant, and we work alongside them.
3. Lender match. We compare bank, non-bank and medico-only lenders on lend ratio, term and rate, then shortlist.
4. Facilities and approval. We split goodwill, premises and equipment into separate facilities where that is cleaner, and move to approval.
5. Settlement. The purchase completes, and we stay available as the practice grows.

Timeframes depend on the lender, the practice and your accountant, so the stages above are a general guide.

It tends to suit a registered doctor, dentist or specialist buying into or acquiring an established practice with clean financials. It suits less well a practice with no trading history, or a buyer who wants no personal guarantee, which most lenders still require on this lending.

The question that stops most buyers is security, and the answer is that a well-run practice can usually stand on its own goodwill and equipment, keeping your home out of the deal. Whether yours does comes down to its financials and the medico lenders active in Australia, and that is what we confirm before you sign a contract.

This page provides general information only and does not take into account your objectives, financial situation or needs. It is not taxation, accounting or financial advice. Lending criteria, rates and terms vary between lenders and can change without notice, and a practice deal depends on the practice's financials and your circumstances. Consider speaking with a qualified professional before acting.