Quick answer
Medical and dental practice finance covers borrowing to buy a practice, buy into a partnership, fit out rooms, buy equipment or refinance existing debt. Lenders often value the stable earnings of practices but treat goodwill and associate arrangements carefully. Ownright Custom Finance arranges practice finance Australia-wide for GPs, dentists, specialists and allied health owners.
Key points
- Covers practice purchase, partner buy-in, fitout, equipment and refinance
- Lenders consider goodwill, location and the practitioner's track record
- Medical equipment can be financed separately from the practice
- Works for GPs, dentists, specialists and allied health
- Suits
- GPs, dentists, specialists, physios, psychologists and allied health owners
- Security
- Practice assets, equipment, property and sometimes personal security
- Common uses
- Practice purchase, buy-in, fitout, equipment, refinance
- Australia-wide
- Yes
What is medical and dental practice finance?
Medical and dental practice finance is business lending designed around healthcare practices. It can fund buying an existing GP clinic, dental surgery, specialist rooms or allied health practice, buying into a partnership, setting up a new practice, fitting out consulting rooms, buying equipment or refinancing existing debt.
Healthcare practices have features lenders recognise: professionals with regulated qualifications, recurring patient demand, high-value equipment and, in many cases, a property component. They also have complications: goodwill that is hard to secure, associate and contractor arrangements, and income tied to the practitioner who may leave.
Who uses practice finance?
- GPs buying an established clinic or moving from associate to owner
- Dentists acquiring a surgery or opening a new one
- Specialists setting up rooms or joining a group practice
- Physiotherapists, psychologists, optometrists and other allied health owners
- Practitioners buying into a partnership or buying out a retiring principal
- Owners refinancing existing facilities or releasing capital for expansion
Practising professionals other than health may find our page on professional services practice finance relevant, and animal health owners should see veterinary practice finance.
How do lenders assess a practice purchase?
Lenders weigh several things at once:
The practice’s earnings. Tax returns, BAS and practice financials show patient volumes, billing patterns and how profit is made. Practices with stable, diversified income and several practitioners often look more resilient than those relying on a single doctor.
Goodwill. The price paid above physical assets is goodwill. Lenders may fund part of it but often want a larger deposit, additional security or evidence the patient base will stay after the sale.
The buyer. Qualifications, registration, experience and track record matter. Registration with the relevant board through Ahpra is the baseline for the practitioner, and a clean history helps.
Premises. Whether the practice owns the property or leases it changes the security picture. Where a property is involved, see medical centre property loans.
Equipment. High-value equipment can be financed separately, often against the equipment itself. See medical equipment finance.
Your personal position. Income, existing debts and credit history. Practice loans are frequently supported by personal security or guarantees.
What can practice finance cover?
| Purpose | How it is usually funded | Notes |
|---|---|---|
| Buying a practice | Business loan, often with property or personal security | Goodwill is a key point |
| Buy-in as partner | Loan funding your share | Partnership agreement matters |
| Fitout | Fitout or equipment finance | See business fitout finance |
| Equipment | Chattel mortgage or lease | Equipment is the security |
| Working capital | Line of credit or term loan | Covers payroll and supplier costs |
| Refinance | New facility replacing old debts | Can consolidate and simplify |
What are the common challenges?
Associates and contractors. If much of the income comes from practitioners who are not owners, a lender may worry about them leaving. A transition plan helps.
Compliance and registration. Lenders want to see the practice is properly registered and the practitioners are in good standing.
Seasonal cash flow. Billing patterns, bulk-billing arrangements and rebate timing can shape cash flow in ways lenders will want explained.
Valuations. Practice valuations can differ widely. Independent evidence of value avoids surprises.
When time is tight or a bank has hesitated, you can tell us about the practice and we will say what could be done.
How Ownright arranges practice finance
Ownright Custom Finance takes a solutions approach. Trevor Scott and the team ask what you are trying to achieve, whether that is owning your first practice, expanding or stepping back, then test the numbers from a lender’s perspective. If goodwill is a stumbling block, we look at ways to structure around it. If the property is part of the deal, we consider how best to fund it. If a bank has declined, we look at why and whether a non-bank lender or different structure could work.
We work Australia-wide, in metro suburbs and regional towns where the need for practices is high. Where acquiring the business is the main goal, our page on business acquisition loans adds context, and our guide to funding a business purchase is a good starting read.
An illustration
Illustrative scenario only. A dentist who has worked as an associate for several years wants to buy the surgery where she practises. The retiring owner is selling both the business and the equipment, and the premises are leased. A broker might arrange a business purchase loan secured over the business assets and personal property, plus equipment finance for the dental chairs and imaging unit. The retiring owner would stay on for a handover period to reassure patients and the lender.
What about starting a new practice from scratch?
A start-up practice has no earnings history, so lenders lean on other things: your qualifications and experience, a realistic business plan, your own savings, the security you can offer and sometimes a lease on suitable premises. Fitout and equipment are usually the biggest costs, and they can often be financed against the assets themselves. Working capital matters too, because a new practice may take months to build patient numbers while rent, wages and insurance are already due. Lenders like to see a buffer for that ramp-up period. If you are leaving an associate role to go out on your own, a clear explanation of how existing patients or referrers will follow, within the rules that apply to you, helps the lender understand the starting point.
How does a practice sale to a corporate group affect finance?
Some owners are approached by larger groups, and some buyers are those groups’ employees looking to buy in. The structure of those arrangements, including restraints and earn-outs, affects how a lender views the deal. We suggest your solicitor and accountant review any such contract first. Once the terms are clear, we can look at the lending that sits around it, whether that is buying equity, refinancing the old practice debts or funding new rooms.
What mistakes should you avoid?
- Paying a goodwill figure that earnings do not support
- Relying on a single practitioner for most of the practice income
- Skipping an independent valuation
- Forgetting to account for lease terms and make-good costs
- Underestimating working capital after settlement
- Applying to several lenders at the same time
What documents should you have ready?
Have practice tax returns and financials, BAS, a patient and income summary, the sale contract or partnership agreement, equipment lists, lease documents, your qualifications and registration details, and personal asset and liability statements. Our guide to getting loan ready is a helpful checklist.
Sounds like you’re after practice finance?
Sounds like you’re looking for medical or dental practice finance, and we know how to present a practice so lenders understand its value. We’re the lending experts at helping practitioners own their rooms and their future, so click the button below and see if you qualify.
How it works, step by step
- 1
Step 1
Tell us what you want to buy, build or refinance and your experience as a practitioner.
- 2
Step 2
We review the practice financials, goodwill and your own income and commitments.
- 3
Step 3
We approach lenders familiar with healthcare practices and the right structure.
- 4
Step 4
Finance is documented and settled alongside the purchase, fitout or refinance.
Frequently asked questions
Can I borrow to buy an existing medical or dental practice?
Yes, many lenders finance practice purchases. They look at the practice's earnings, how much of the price is goodwill, your qualifications and experience, and the security available. Lenders often view established practices with consistent patient numbers favourably. We help present the purchase and match it with suitable lenders.
How do lenders treat goodwill in a practice purchase?
Goodwill, the value of the practice's patient base and reputation, is harder to secure than physical assets. Lenders may fund a portion of it but often want a deposit, additional security or supporting evidence of earnings. We discuss how much goodwill sits in the price early on.
Can I buy into an existing practice as a partner?
Often, yes. Buy-in finance funds the share of the practice you are acquiring. Lenders review the partnership agreement, your income and the practice's financials. Clear terms about how an exit will work help. We can arrange finance for buy-ins from principals and associates.
Can dental or medical equipment be financed separately?
Usually, yes. Chairs, imaging machines, sterilisers, ultrasound units and other equipment are commonly financed as assets, with the equipment itself as security. This can keep the main loan smaller. See our page on medical equipment finance for more detail.
Can I get practice finance as a newly graduated practitioner?
Sometimes. Lenders usually like some post-qualification experience, but not always a lengthy history. Supporting security, a strong plan or an established practice with a transition arrangement can help. Tell us your qualifications and timeline and we will suggest realistic options.
What if the practice is owned through a trust or company?
That is common and usually workable. Lenders look at the structure, who the trustees or directors are, and what guarantees they will require. We map out the ownership early so the right entity borrows and the paperwork lines up.