5 ways to boost your chances for a veterinary practice loan


It's never too early to prepare for veterinary practice loan application. Follow these tips and avoid roadblocks on your road to ownership.

Who will finance your practice purchase? The seller may finance part or all of the purchase, but usually you'll need to borrow from outside lending institutions. Here's what some top lenders in the veterinary industry say you can do to convince them to approve your loan.

1 Develop personal cash reserves. Do you have cash available for a down payment when you're ready to buy a practice? Save, save, save. In today's banking and lending environment, liquidity is king.

2 Maintain a squeaky-clean credit history. As a rule of thumb, credit scores above 675 are necessary to be approved for a loan. In fact, poor personal credit is the one thing that can stop ownership ambitions cold. Visit annualcreditreport.com to receive your free annual credit report.

3 Pursue a conservative lifestyle. This means refusing to accrue lots of consumer debt. But don't despair about your student loan: Lenders understand this type of debt and it's not always a huge factor in their decision. Also, mortgages that can be supported by sufficient cash flow and are reasonable when compared to income would not negatively impact your loan application. In some cases they can even help your cause.

4 Educate yourself about business. In particular, gain an understanding of cash flow. Purchasing a veterinary practice is one of the largest investments of your career, and cash flow is the language of this type of investment.

5 Build a strong resume. Gain three to five years of clinical experience before becoming an owner and at least one year of experience at the practice you want to purchase. Track your success—production reports provide insight into the volume of work you've handled in the past, which is useful for a lender's consideration of the loan.

Adapted from information provided by Live Oak Bank, Wells Fargo Practice Finance, U.S. Medical Funding, and Commerce National Bank.

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