Different Loan Options For Doctors To Grow Their Practice

A successful medical practice needs two things—a bunch of competent doctors and medical practitioners, and a clinic or hospital with state-of-the-art infrastructure.

Young doctors or a group of doctors looking to start their own practice, and perhaps, set up a multi-speciality clinic or hospital, may not have the financial resources to start their own venture and keep it going at least during the initial few months until cash flows begin kicking in.

That is where a medical business loan can come in handy. Not only can a business loan help doctors get started on their entrepreneurial journey as a medical practitioner, it can also help them meet working capital expenses as well as help pay wages and buy new equipment. Doctors can typically have five kinds of loans.

Business Loan

A business loan can come in handy and can be availed with minimal paperwork and in good time from most reputable lenders, especially if the doctors have a good credit history.

A business loan can help doctors set up a new clinic or a hospital or even buy an existing enterprise. Apart from meeting day-to-day working capital needs and paying salaries, doctors can also use the money from the loan to pay for the software and other tools needed to manage the business.

Many lenders offer a business loan at an attractive rate of interest and convenient repayment plans that suit the cash flows of the clinic or the borrowing doctor’s medical practice.

Healthcare Equipment Loan

While doctors can take a business loan to buy or set up a clinic or hospital, they also need capital to purchase state-of-the-art and costly equipment such as X-ray machines, ultrasound scanners, and ventilators, apart from specialized furniture like beds, surgical tables and so on.

Many banks and non-banking finance companies offer specialized loans to buy medical equipment. These loans can vary from Rs 50 lakh to as high as Rs 5-15 crore, with tenors of up to seven-eight years.

Personal Loan

Doctors typically come with the best education and, therefore, a good pedigree to boot. This can help them obtain a personal loan to finance their own needs at the most attractive rates of interest on offer in the market.

With a personal loan, doctors can take a vacation they always wanted or get some much-needed home repairs done or simply use it for any other need.

As long as doctors have a sound credit history, getting a personal loan should be a breeze. Not only is a personal loan free of any collateral, it can also be availed in just a few clicks, with most good lenders making the process online and hassle-free.

Loan Against Property

Doctors can easily avail a loan against property, especially if they are in need of a big amount either to meet their business expenses or even for personal needs.

Often, a clinic or hospital will require the doctors to procure expensive medical equipment or expand their facilities. For this, they may need some extra cash. A loan against property can be useful in such cases.

As the name suggests, a loan against property is a secured loan and doctors need to keep a property as collateral in order to avail it.

In fact, this could be an ideal loan to take if doctors want to expand and add facilities to their clinic or hospital, since they can take the loan to expand the same premises. Doctors can use such a loan also to set up a new clinic or hospital, buy a commercial or a residential property, or, for that matter, for lease rent discounts. The amount of loan disbursed will depend on the assessed value of the property being put up as collateral.

Home Loan

Like everyone else, doctors need a home, too. And like everyone else, they can take a home loan to buy or build a nice, plush home. But there is a difference.

Some lenders may hesitate to offer loans to salaried or self-employed professionals due to reasons such as potential layoff risks, salary cuts or unsteady incomes. But doctors, even those who run their own clinics, typically face fewer such hassles for obvious reasons—good doctors are always in demand, even in an economic downturn, and they can continue to work well past the usual retirement age!

In fact, many lenders offer bigger loans as well as better interest rates and repayment terms to doctors. A good lender will also help doctors with value-added services like property search, assistance with legal or technical matters and also help with due diligence to make sure the property is free from any legal encumbrances.

Conclusion

If you are a doctor, you can typically get all of these types of loans, either as flexi loans or fixed loans. Usually, flexi loans are a better option as they allow you to borrow only that much money that is needed, in installments. The remaining amount is available to you for the future. In a flexi loan, you only pay interest on the amount you have actually borrowed and not on the total amount that has been sanctioned.

Moreover, if you opt for a well-known lender like IIFL Finance, you can get a loan via a simple online process with minimal paperwork. IIFL Finance also offers competitive interest rates and easier repayment options.

So, the next time you are in need of money, don’t hesitate to go in for a loan best suited to meet your needs.