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Current Lender Rates and Expectations in the Dental Transitions Market

Lender discusses rates

By David Haynes, MBA, Vice President of National Practice Sales

An important step in a dental practice transition is for the buyer to secure a loan. As financing is increasingly complex, we wanted to provide dentists with information on current lender rates and expectations in the U.S.

Current Trends

Some practice buyers have enough cash on hand to purchase a practice, but in most cases, buyers are dependent on banks for financing. Lenders evaluate potential practices to determine how much they would be willing to lend those buyers. Lenders have historically required two to three years of financials to determine practice values, and they like to see consistent financial trends when lending to a new buyer.

Since many dentists had a down year in 2020, some lenders are more cautious in offering loans to practice buyers. Others are excluding the down year entirely if the seller can prove a strong rebound. We are also seeing some lenders include Paycheck Protection Program funds and grant income as part of the practice’s financials when underwriting a loan.

Market Expectations

In the coming months, we expect the lending environment will remain very competitive. Lenders are eager for dental product and compete with each other in the rates they offer. 

We will continue to keep our eye on inflation and potential intervention by the U.S. government. We could see an increase in rates, but the rate increases shouldn’t be enough to negatively affect practice buyers.

How a Broker Can Help

Brokers can help sellers present their practice financials in a fair and positive manner, adding context to any financial declines and rebounds to ensure the practice is valued accurately. These professionals can also recommend lenders who specialize in dental product.

If you have any questions about the current lending environment, please contact me at

Looking for more information about the current U.S. dental transitions and employment markets? We invite you to watch this market update presented by me, David Haynes, and my business associate Dan Blair, MBA, formerly of Menlo Dental Consulting.