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
http://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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