How to Get a Loan to Start a Restaurant | L3 Funding

A Guide to Restaurant Loans: Start Ups & Small Businesses

Few people can finance a restaurant using nothing but their savings or loans from family and friends. Restaurant loans for start ups potentially require six-figure sums, particularly if constructing a restaurant from scratch.

Understanding how to get a loan to start a restaurant requires exploring the various financing options available to you. Your eligibility largely depends on how much you want to borrow, your credit rating, and the size of your down payment.

Let’s examine how to get a loan to open a restaurant and what you can use it for. 

Types of Start Up Restaurant Loans

Before choosing the right loan to start a restaurant, it’s vital to form a complete business plan. Every lender will want to see that you have put serious thought into the amount of money required, what you will use the money for, and your financial projections for those initial three to five years in the industry.

Several factors go into choosing the right start up restaurant loans, including down payments, interest rates, and collateral requirements. Here are three of the most popular restaurant loans for start ups.

Traditional Commercial Loan

The traditional way of obtaining financing for a restaurant is to approach a bank. Bank loans give you access to large amounts of financing, but the application process can take up to six months. Moreover, you will need a high credit score to get approved for these loans.

Commercial loans from banks are characterized by their lower interest rates, which will reduce your monthly repayments. Banks will offer short and long-term loans. The latter, however, is a risk because there are so many unknown factors involved in starting a restaurant.

Banks may request collateral to qualify for these loans, including your home, a vehicle, or even assets from an existing business. If you qualify, traditional commercial loans are helpful, but these lenders are inflexible and unlikely to form an accommodating relationship if you require that extra flexibility.


  • Lower Interest Rates – You can find loans with interest rates as low as 6%.
  • Higher Capital – Smaller lenders may not provide you with the capital you need to cover all your expenses.
  • Reduced Monthly Repayments – Bank loans often have terms ranging from three to ten years, allowing you to repay smaller amounts over a more extended period.


  • High Credit Score Requirements – Entrepreneurs without a stellar borrowing history may struggle to meet the higher credit score requirements levied by banks.
  • Long Application Period – Be prepared to wait up to six months to receive a decision on a loan application.
  • Collateral Requirements – Banks will usually ask you to put up personal assets as collateral, meaning if the restaurant fails, you could lose your home.

Business Line of Credit

The easiest way to view a business line of credit is like a credit card. If you’re approved for a business line of credit, you will have a specific amount to work with. For example, if you receive a business line of credit valued at $50,000 and only use $10,000 during your first month, your repayments will be based on the $10,000 borrowed rather than the $50,000 maximum.

Furthermore, these financing options are revolving, meaning you can borrow, pay the amount back, and then borrow again. These are excellent financing options for covering those ongoing expenses.

Interest only begins accumulating once you actually spend the money. Plus, the interest only accumulates on the amount borrowed. It’s a far more flexible way of borrowing to fund your restaurant than a classic term loan. Borrowing amounts are lower than term loans, and interest rates will also be higher.


  • Flexibility – You only pay back what you borrow. There’s no obligation to spend any of the money as part of your business line of credit.
  • Revolving Loans – Every time you pay down your balance, money becomes available to be used again.
  • Improve Cash Flow – Business lines of credit are excellent options for improving your cash flow since you can instantly borrow without prior approval after the lender accepts your initial application.


  • High Interest Rates – Lenders will typically charge higher interest rates than traditional commercial loans.
  • High Lending Standards – Getting approved for a business line of credit typically has a higher bar than other forms of financing.
  • Low Capital Amounts – The maximum amount you can borrow is much lower than with other restaurant loans for start ups.

Small Business Loan

Specialized small business lending options are available from most national and regional banks. Banks can offer these loans through partnerships with the U.S. Small Business Administration (SBA).

The SBA is a department of the Federal government dedicated to supporting small businesses across the country with financing. To encourage commercial lenders to give smaller companies a chance, they guarantee a portion of the loans offered, thus reducing the risk accrued by lenders.

There are several SBA programs available, but you want to look into their Guaranteed Loan Programs for restaurants. SBA guidelines ensure that even if a borrower defaults, they will guarantee the repayments, thus eliminating the lender’s risk.

Small business loans require a lower credit score than conventional loans. Most of the time, your credit score can be as low as 650, and you’ll still qualify. You can benefit from lower interest rates and smaller down payments if you are eligible.

Conventional loans may require a 20% down payment on your business, but this requirement is usually waived with many of the SBA’s loan programs. However, if putting down a smaller down payment, you will still be expected to put up collateral to secure your restaurant start up loan.


  • Lower Interest Rates – The SBA aims to take the strain off small businesses by encouraging lenders to lower their interest rates in exchange for guaranteed repayments.
  • Borderline Credit Scores – Unlike other loan types, you can qualify even if you have a borderline credit score. This is ideal for entrepreneurs with average credit scores.
  • Lower Down Payments – Rather than putting up a high down payment, you can put down some collateral instead.


  • Harder to Qualify – The SBA only gives out a limited number of loans. The qualifying requirements are more stringent than other restaurant funding startup options.
  • May Require Collateral – In some cases, you may be required to put down your personal assets as collateral, meaning they will be at risk.
  • Long Application Periods – Small business loans often take longer to qualify for because of the multitude of requirements involved.

What Can Start Up Restaurant Loans Be Used For?

The startup costs of establishing and running a restaurant can quickly run into six-figure sums. Obtaining a loan to open a restaurant gives you the capital necessary to get your business off the ground.

In this section, you will learn about some of the most common use cases for your loan.

Commercial Lease

Most startup restaurants choose to rent a location as opposed to buying. Your commercial lease is your monthly payment to secure your commercial space. When opening your restaurant, you need to balance your decision based on the amount of foot traffic available, accessibility, and the asking price.

Restaurant Insurance

A comprehensive restaurant insurance policy is essential to protect your venture from losses that may occur because of doing business. Your insurance policy covers you against employees being injured on the premises, property damage, and lawsuits.

License Fees

Most states have specific licensing fees for your restaurant’s various activities. The most common licenses include general business licenses, Food Service Establishment Permits, and liquor licenses.

Staffing Costs

Even if you start with a small team, you need the capital to cover their salaries and any workplace benefits you choose to offer. Tipped employees are paid at a lower minimum rate, whereas non-tipped employees, such as kitchen staff and cleaners, will need to be paid the state minimum wage.

Kitchen Equipment

Unless purchasing an existing restaurant, you’ll need to buy kitchen equipment. These are usually the first costs incurred by restaurants. The cost of commercial kitchen equipment varies depending on the type of cuisine and the size of your kitchen. Since kitchen equipment is so critical, you should have already costed up commercial kitchen equipment as part of your loan application.

Beginning Inventory

Inventory will include everything from furniture to dishes. Additionally, you’ll need to create a small working menu and purchase the necessary food items to execute that menu. In the initial growth stages, restaurants often choose a limited menu filled with signature dishes.

Working Capital

Your working capital is what you need to cover your operating costs. When taking out a loan to open a restaurant, begin by budgeting for six to twelve months in operating expenses. Working capital will cover the daily running costs of your restaurant, regardless of how many customers come to eat.

Marketing Capital

Launching a new restaurant is a challenge due to how competitive the market is. The most effective form of restaurant marketing is word-of-mouth marketing, but this takes time to generate. Initially, you’ll need to focus on traditional marketing techniques, such as handing out fliers, newspaper ads, radio spots, and social media advertising.

What You Need to Get a Start Up Restaurant Loan

Securing a loan for a restaurant start up begins by getting your affairs in order. Unlike applying for a personal loan, restaurant loans for start ups are more in-depth. The lender will want to see that you’re not just a reliable borrower but have a solid business plan.

Lenders focus on the level of risk involved when assessing an applicant. Your application will undoubtedly be rejected if the risk is deemed too high. Preparation is essential for increasing your chances of being approved for a loan. Here’s what you need before applying.

Loan Application

Lenders will have different systems for applying for a business loan. Most lenders will include the guidelines on their website for what needs to be included. You can also use online loan templates to provide structure to your application.

Consider including a table of contents within your application to allow for easy navigation. Little touches like these make you look more organized and create the right first impression.

Personal Background and Financial Statement

These documents reveal your personal history and your financial history. Remember, since the business hasn’t yet been formed, the lender is basing their decision on you and how you’ve handled debt in the past. Proving that you know how to manage debt and have experience handling money responsibly is an excellent first start.

Profit and Loss Statement

Creating a profit and loss statement for a new business may seem impossible, but every lender will require one. Your figures will be based on your projected figures. Lenders want to get an idea of what your accounts will look like.

Projected Financial Statements

Lenders want to know the answer to one question: how are you going to create a successful restaurant? Produce a one-year projection of your income and the restaurant’s finances. The critical point of your projected financial statements is to keep them realistic. 

Lenders will also ask you to provide a written explanation regarding how you plan to achieve that projection. An example of an explanation could include opening up a concept restaurant or providing a type of cuisine that the local market has yet to cater to.

Ownership and Affiliation Documents

Ownership and affiliation documents are statements of any other companies you own, partially own, or have a controlling interest in. It also goes as far as stock ownership, mergers, and even business franchises. If this is your first foray into business, you simply need to state that you hold no interest in other companies.

Business Certificate

Ensure you already hold a valid business certificate to do business in your state. No lender will authorize a loan if you have yet to be approved to start your business. The expenses relating to obtaining a business certificate must be covered out-of-pocket. Moreover, you should submit the original certificate rather than a copy.

Loan Application History

Include your history of applying for past loans. Entrepreneurs with experience obtaining and paying off business loans will automatically hold an advantage over someone with a blank financial history.

Personal Finances

You should submit a signed and notarized copy of your last three years of Federal income tax returns. If you already run a business, you should also provide tax returns for that business over the previous three years. Include your personal resume and the resumes of any business partners you may be working with to give the lender an overview of who will be operating the restaurant.

Business Overview

Finally, you should include a business overview. Think about what your restaurant is all about and its story. It should only be a few paragraphs and carefully detail what you need the money for. There’s nothing wrong with saying you need the loan to cover its startup costs in its entirety.

How to Get a Loan to Open a Restaurant

It’s important to understand that getting a loan for a restaurant start up can be challenging. Lenders are naturally reticent about lending money to people in an industry that is universally perceived as volatile. Failure rates are high, hence why lender requirements are more stringent than in other sectors.

Assuming you have already gathered your documentation, here’s a basic step-by-step guide for getting a loan to open a restaurant.

Step One – Find a Lender

The first step is to find a lender that suits you. You’ll weigh up the different restaurant funding startup options outlined above and determine which one works best for your business plan. For example, many business owners fail to qualify for traditional commercial loans, but they may be eligible for a startup loan backed by the SBA.

It’s strongly recommended that you avoid entering into any agreements until you receive authorization for your loan. Failing to qualify for faster financing options could mean putting your plans on hold for several months. Create a shortlist of lenders you will apply to and don’t put all your eggs in one basket.

Step Two – Determine Your Eligibility

Before applying for a loan, make sure you qualify. Lenders will always make their criteria available on their websites. Some examples of essential points to focus on include:

  • Time in Business – If your restaurant is already open, you will need to have been in business for at least a couple of years. However, if you have relevant industry experience, you may already qualify.
  • Personal Credit – Your personal credit score will be used to approve or deny your application. SBA loans require just borderline credit scores, but traditional commercial loans will have a higher bar to cross. Most lenders will also automatically deny loans to those with a history of delinquency or bankruptcy.
  • Collateral – Not all loans need to be completely collateralized, but most do. If you have collateral, including personal assets, lenders will typically ask you to guarantee the loan personally.
  • Down Payment – Like a mortgage, you will need to come up with some form of down payment. SBA loans can be as low as 10%, but many lenders may ask for up to 30% in the form of a down payment.
  • Commercial Real Estate – If you’re using your loan to finance a commercial real estate purchase, the property must be at least 51% owner-occupied.

The most important thing is that you take the time to investigate the lender’s requirements — there’s no point in applying for a loan you don’t qualify for.

Step Three – Create Your Business Plan

Your business plan is the crux of any application for a loan for a restaurant start up. Several aspects make up your business plan, including:

  • Market research
  • Your sales strategy
  • Personal background
  • Restaurant background
  • How much financing is needed
  • What you will do with the financing
  • Financial projections covering three years

You will find plenty of templates online to create an organized business plan. The chances are your lender will grill you on your business plan, so make sure you’re ready with well-prepared and thoughtful answers. Additionally, try not to be too ambitious with your business plan. Unrealistic projections will only see your application being turned down.

Step Four – Submit Your Application

Now that your documentation is in order, it’s time to submit your application. Each lender will usually have its own process for applying. If you’re applying to a local bank, you may choose to visit them in person. Alternatively, you can send your application online. Lenders may even have a dedicated online platform for business loans.

Once you’ve sent everything, all you can do is wait for them to get back to you. Be prepared to supply any additional information they request promptly.


Negotiating the pitfalls of the restaurant loan application process is a challenge for newer entrepreneurs. Here are the answers to some of the most common questions regarding restaurant loans for start ups.

Why is it harder to secure financing for a restaurant?

There’s no getting around the fact that getting a loan to launch a restaurant is more arduous. Failure rates are high across the industry, and the restaurant business is notoriously volatile. Lenders have often turned down applications for these reasons alone. However, it’s becoming easier to get loans for restaurants due to alternative merchant funding services like L3 Funding.

How much is an SBA restaurant loan worth?

The SBA backs loans for both new and existing restaurants. How much a loan is worth to you depends on the program. Microloans offer up to $50,000 in financing. Applying for an SBA 7(a) loan, on the other hand, could provide you with up to $5 million in capital.

What’s the right amount of capital to apply for?

There is no one-size-fits-all answer to this question, as the amount will depend entirely on what you need from your loan. You don’t want to borrow too little, and you don’t want to borrow too much. It all goes back to the importance of your business plan. To maintain your cash flow, come up with realistic projections and aim to cover six to twelve months of operating expenses.

Could I lose my personal assets if my restaurant fails?

Short answer: yes. Lenders will ask for some form of collateral, whether a home, a car, or another business. Your personal assets will be at risk, so it’s essential to think carefully about your restaurant idea before applying for funding.

Find Your Funding with L3

Restaurant loans are critical to starting a new eatery in your hometown. This is an ultra-competitive industry with an extremely high failure rate. Before moving forward, make sure you craft your business plan and get expert advice on your business concept.

At L3 Funding, we support entrepreneurs in launching their restaurants by securing the funding they require at competitive rates. If you’re ready to make your dream restaurant a reality with reliable merchant funding, get in touch with L3 Funding today.


Medical Marijuana Taxes & Fees, Explained | L3 Funding

A Quick Guide to Medical Marijuana Taxation

The medical marijuana industry can be incredibly complex, especially when it comes to businesses and medical marijuana taxes. Whether you choose to open a growing, processing, or retail business, you need to account for fees and taxes as part of your business plan. 

Becoming familiar with the complexities of medical marijuana taxation is crucial for avoiding penalties and setting your business up for success. Here’s what you need to know about taxation and medical marijuana sales.

What Business Owners Need to Know About Medical Marijuana Taxation 

Is there a tax on medical weed? The short answer is yes. However, fees for licenses, sales taxes, and excise taxes differ. Understanding how your state’s system works is crucial when creating a business plan and obtaining a marijuana loan for your firm.

How does taxation differ for medical versus recreational marijuana? The main difference is that recreational marijuana tends to receive additional sales tax, whereas medical marijuana is exempt. However, some states don’t have special tax regimes for medical marijuana. 

Every state treats medical marijuana differently for tax purposes. Marijuana remains illegal at the Federal level, so there’s no one-size-fits-all process between states. Certain states tax medical marijuana at the same rate as recreational marijuana, whereas states like Florida apply no tax on medical weed at all.

With a relatively new industry like this, there’s a lot of confusion around what fees and taxes will apply. Here’s everything you need to know about the various taxes and fees that could impact your medical marijuana profits.

Application Fees

All businesses looking to sell medicinal marijuana must have a license. Application fees are nonrefundable and need only be paid once when starting the business.

Some states like Arizona charge a flat $5,000 application fee for every business seeking to obtain a license. California, on the other hand, has a varying application fee based on whether you are a dispensary or a distributor. In California’s case, application fees are $1,000 for distributors, whereas cultivators can see application fees as low as $135.

Your application fee must be paid upfront. It’s important to note that even if your application is rejected. This is to deter frivolous applications while still giving states a reliable revenue stream from the industry.

Registration Fees & Annual Fees

Your registration fee qualifies you as a licensed medical marijuana business. Without this registration, you will be unable to do business in your state. Any tax-included or tax-free dispensary must pay an initial registration fee to open its doors.

In addition to the registration fee, you’ll also pay annual fees to renew your registration. These fees must be paid, no matter your medical marijuana revenue for the previous year. States levy annual fees to gain extra revenue from the industry.

Registration fees often depend on the type of medical marijuana business. For example, Colorado charges anywhere from $3,000 to $11,000 for medical marijuana centers and $2,200 for infused product manufacturers.

Minnesota has a policy of discouraging smaller providers from entering the market. The annual fee for these businesses ranges from $75,000 to $100,000 per year. On the other hand, there are no separate registration fees.

Excise Taxes

An excise tax is paid when a product (in this case, medical marijuana) is transferred from a cultivator or processing center to the dispensary. Not every state will charge excise taxes on medical marijuana, but these taxes are typically always present with recreational marijuana. The dispensary initially pays excise taxes, but many companies choose to pass these taxes onto their customers.

Nevada levies a 2% excise tax on both wholesale and retail sales, regardless of whether a company sells medical or recreational marijuana. New York is a state that levies high excise taxes on marijuana, with a hefty 7% excise tax. Business owners in New York may, therefore, consider compromising on their medical marijuana profit to reduce the strain on their customers.

California has one of the most complex systems for excise taxes. There’s a flat rate of $9.25 per ounce of cannabis flower, plus an additional 15% retail excise tax. While people purchasing medical cannabis can avoid sales taxes, they cannot avoid excise taxes.

State & Local Taxes

State and local taxes vary heavily on medical marijuana. Some states have high state taxes on medical marijuana, whereas others have none at all. Local taxes also need to be considered. These are charged by your municipality, and there’s no way to give an average for what these may be.

Remember, state and local taxes stack, so you and your customers may need to pay a hefty amount at once. It should be included in your business plan when determining your medical marijuana revenue projections for the year, and you should consider how you’re going to split the taxes to balance your marketability.

Oregon is a state that has seen the marijuana business thrive. There are no state taxes and no sales taxes, meaning marijuana in Oregon is among the cheapest options nationwide. Connecticut also has state tax and sales tax exemptions for medical marijuana of 0%. The same does not apply to recreational marijuana, however.

Florida will charge you 6% state taxes plus any local taxes on medicinal marijuana sales. You may decide to become a partially tax-included dispensary to account for this. Illinois, however, charges the full 7% state excise tax on wholesale purchases, plus a 1% sales tax.

Regardless of whether your state charges state taxes or sales taxes on medical marijuana purchases, local taxes may end up being the kicker. Some dispensaries have found they can serve a neighborhood while registered in a neighboring municipality to limit their tax exposure.

Medical Marijuana Taxation Influences Everything

So, what lesson do the numbers above teach owners of medical marijuana businesses? That medical marijuana taxation in your state will influence everything — from where you establish your business to who you serve and how much you charge them.

While some states like Oregon are extremely generous when it comes to taxation, the increased competition may make it extremely difficult to break into this already saturated market.

The best strategy you can employ is to balance costs with opportunity. It will most likely cost thousands of dollars in fees to start your medical marijuana business, so it’s important that you make sure the opportunity is there after you open your doors to the public. 

Prepare a business plan and make realistic projections as to your revenues and profitability during the initial few years. When seeking financing for your new venture, you’ll need to show that you’ve put serious thought into constructing a successful business.

Find Your Funding with L3

While the world of medical marijuana is a thriving industry with tremendous opportunity as regulations across the country change, high fees and taxes in many areas of the country mean that small businesses with less funding start at a disadvantage.

Build a strong foundation for your business with merchant funding from L3. We support medical marijuana businesses during their early stages, helping savvy business owners get the financing they need to watch their dreams grow.To learn more about financing for your medical marijuana venture, contact L3 Funding today.


How to Decide Between a Joint Venture vs. Partnership | L3

Joint Venture vs. Partnership: What’s the Difference?

It’s not unusual for savvy professionals to go into business together — who doesn’t want a trustworthy partner by their side? However, it’s important to make your business relationship official from the get-go. 

You have two options to choose from: a joint venture or partnership agreement. Becoming a JV partner or opting for a standard partnership may sound similar in name, but are actually quite different in legal terms. Understanding the difference between partnerships and joint ventures empowers you to make the best decision for yourself and your business.

Let’s go into the difference between a joint venture vs. partnership, as well as the pros and cons of each. 

Joint Venture vs. Partnership Agreement: What’s the Difference?

The first step to starting your business off on the right foot is deciding on a partnership versus joint venture. Before diving into the differences, let’s define each option and examine how they can impact your company’s progress.

What is a Joint Venture Agreement?

Signing a joint venture agreement means you can work with at least one other individual or business to accomplish a strategic goal. In this scenario, all parties will operate separate businesses. A JV partnership means you are all driving toward the same goal while retaining your own independent operations.

Some common examples of when joint partnering makes sense include:

  • Building and developing real estate
  • Book publishing agreements
  • Travel agreements for overseas projects
  • Research and development operations
  • Mining and energy syndicates

These arrangements are ideal for when a single business alone lacks the expertise or funding required to maximize a project’s potential. Entering into a joint venture agreement combines resources to punch above your weight.

However, a critical aspect of a joint venture partnership is that the individual must pay any debts incurred by the parties involved. Debts and other similar financial obligations are not shared. Profits, however, will be divided at the end of the project, according to the initial agreement signed.

Most people assume that a joint partnership is an arrangement involving major multinational corporations. Any business can choose to form a joint partnership.


The advantages of joint venture partnerships include:

  • Temporary – Joint ventures don’t force you into a marriage for life, unlike a merger. Your agreement will dictate when and how the contract can be ended.
  • Greater Resources – Gain access to more staff and technical expertise. If you specialize in one area and your partner specializes in another, a joint venture agreement allows both sides to benefit.
  • Develop New Products/Services – Develop new products and services together. It could be the key to expanding your business.
  • No Outside Financing – Rather than taking on external financing, you can grow without borrowing money or courting investors.
  • Expansion – To put it simply, these agreements allow you to expand your operations.


Despite the advantages outlined above, there are downsides to joint ventures that need to be evaluated when considering this type of arrangement. Some of the downsides include:

  • Finding Trustworthy Partners – You need to trust your partners, and finding a worthy partner can be a challenge.
  • Uncertainty – There’s no guarantee of success when signing one of these agreements. Success depends on the ability to collaborate effectively.
  • Conflict – Working with somebody else always increases the chances of experiencing conflict. Likewise, there’s always the risk that one or more parties will lack commitment throughout the project.

What is a Partnership Agreement?

The key difference between joint ventures and partnerships is that a joint venture will end. It may have a defined ending date, or when the common goal has been achieved. Partnerships are ongoing relationships between two businesses.

Your partnership is not a separate legal entity in the same way as a company. Each partner is jointly responsible for the activities conducted by the partnership. For example, if a partner cannot cover a debt, other partners will be forced to step in.

While business arrangements should always be put in writing, a written agreement is critical in a partnership. It’s crucial for everyone involved that there’s an official document outlining key aspects of the partnerships, whether it be guidelines for governing the relationship, denoting responsibilities, or providing clear legal recourse for when conflicts arise.


Partnerships have several potential advantages over a joint venture. Remember, partnerships are a more tight-knit form of business relationship, but they’re not as binding as a merger.

Here are a few reasons why you may opt for a partnership over a joint venture:

  • Simplicity – Partnerships are easy to establish, and the startup costs are low.
  • Income Splitting – If everyone involved agrees (and puts it in writing), you have an opportunity to split income.
  • Fewer Regulations – You have fewer rules to abide by when forming a partnership, which gives you more flexibility than a joint venture.
  • Privacy – Despite being partners, there’s no obligation to share private information regarding business affairs.
  • Change Structure – Due to its flexibility, you can easily alter the business structure later.


Most of the disadvantages of partnerships are related to trust issues. Problems can occur long after entering into agreements, whether it be from untrustworthy partners or disagreements down the line. In a worst-case scenario, a partnership gone wrong could threaten the future of your business.

  • Liability – You have unlimited liability, meaning your personal assets could be at risk. You’re also jointly liable for the debts of your partners. Likewise, any actions your partners take could impact you because of the liability problem.
  • Profit-Sharing – Profits may end up being shared between all partners, no matter how much they contributed.
  • Untrustworthy Partners – Since you’re not protected from liability, an illegal or questionable act from one of your partners could get your business into trouble.

Joint Venture vs. Partnership: Which is Right for You?

There’s a time and a place for both a joint venture and a partnership, you simply need to find out which suits your company best. Factor in the current standing of your business, where you want to go, and what you want to get out of the agreement.

Let’s discuss a few points that could impact your joint venture / partnership agreement decision.


Forming a relationship with anybody requires a degree of trust. But with so much at stake, this is especially true for business partnerships. A professional partnership will always require a greater level of confidence in the skills and integrity of all parties.

Joint ventures are designed to keep both parties independent from one another. If someone messes up, you’re not liable for their mistakes. On the other hand, partnerships leave you responsible for everything from legal risk to debts. The unlimited liability factor means a partnership can also risk your personal assets and finances.

Unless you absolutely trust the business practices of another party, don’t enter into a partnership.

Project Scope

Consider the scope of your project and wider company goals. Joint ventures are designed to be temporary and include a stated purpose. Most agreements of this nature state that once a goal has been accomplished, the deal comes to an end. Partnerships are better if you’re looking to form an ongoing relationship with several goals. 

Agreement Complexities

Partnerships may be simple to set up in theory, but they require a lot of careful thought and attention. Who owns what assets? What if somebody wants to get out of the business? How will you address the issue of income splitting?

Ending a joint venture is relatively easy, whereas dissolving a partnership is more complex if disputes arise. Whenever you enter into a partnership or joint venture, you should always seek independent legal advice to go over the final agreement. 

Tax Purposes

Partnerships are always considered to be “pass-through” entities. In other words, any income gained or dividends distributed will be regarded as income for tax purposes. Partners will need to pay their fair share of taxes based on how profits have been divided. It also works the same way for losses. Joint ventures may be taxed in an entirely different way. You can elect to have them taxed as a partnership or corporation.

There are advantages and drawbacks to each in terms of how they’re taxed. Partnerships are more flexible because of how profits and losses can be divided. Together with an accountant, partners can divide profits and losses in a tax-efficient way for everybody.

Business Structure

A partnership is an established agreement forming a partnership. Joint ventures may be structured in several different ways. For example, some companies may elect to create a separate, independent legal entity for the duration of their joint venture. It creates a degree of separation that you cannot get with a partnership.

Partner with L3 Funding 

Deciding between a joint venture vs. partnership is essential when entering into any form of business agreement with another party. Make sure you seek independent legal and financial advice before determining whether this is the right move for you.

To improve the prospects of your joint venture or your new partnership, you may decide to seek external financing. L3 Funding specializes in supporting entrepreneurs with reliable merchant funding, having provided more than $2 billion in funding to small businesses since 2007.

If you want to find out more about securing the right business loans for your next project, apply with L3 Funding now.


Revolving Credit vs. Installment Credit | L3 Funding

The Complete Guide to Revolving vs. Installment Credit

The world of financing and credits can be complex, whether it’s being pursued for business purposes or personal finances. Personally, external credit can help people through tough times or get over a financial hump. Businesses need financing to keep the wheels moving and as any business owner knows, cash flow is essential — particularly during the early stages. The right financing can streamline various aspects of business operations, whether it be building manufacturing facilities, securing supply chains, hiring a team, or distributing products and services.

Whether you’re starting a business or consolidating your household debt, an understanding of revolving vs. installment financing is essential for determining which type of credit makes the most sense.

In this guide, you will learn everything you need to know about revolving credit vs. installment credit.

Revolving vs. Installment Credit: What’s the Difference?

This may surprise you, but chances are you already use both revolving and installment credits as part of your private finances. These are both common and they both have an impact on your credit score (both personal scores and company credit ratings). In order to help you understand revolving vs. installment credit, let’s take an in-depth look at each. 

Revolving Credit

The main difference between installment loans vs. revolving credit is that if your loan is classified as “revolving,” you can continually borrow more if you stay under your borrowing limit and pay back your outstanding debts.

How does this apply to credit cards? Is a credit card installment or revolving credit?

The most regularly used version of a type of revolving credit is a credit card. For instance, if your credit card has a limit of $5,000 and you borrow $5,000, you can borrow a further $5,000 the moment you repay the outstanding amount. You can borrow as and when you need to once approved.

A Home Equity Line of Credit (HELOC) is the other most common form of revolving credit. Deciding whether a personal loan is installment or revolving credit can be tricky due to interchangeable terms, as it can be both.

The benefit of utilizing revolving credit is once you’ve obtained your revolving credit, there’s no need to tell the lender when you want to borrow money. Many people have active HELOCs or credit cards that they use only when needed. It provides instant access to cash in an emergency, whereas most installment loans take time to apply for.

Revolving credit has a significant impact on your credit score because a substantial portion of your score is calculated from your credit utilization ratio. You should always aim to remain below 35% of your overall balance to optimize your credit score.

Installment Credit

Installment credits are the most common form of financing available to individuals and businesses. The way they work is simple: you take out a loan for a predetermined amount and make monthly repayments. Most installment credits come with a fixed interest rate and a final date for when the entirety of the loan should be repaid. Three common installment credit examples include personal loans, mortgages, and auto loans.

There’s no way to continue to borrow against an installment loan. If you apply for a personal loan of $10,000 to invest in a new business venture, you will receive $10,000. Borrowing more will require you to begin the application process and take out an entirely new loan.

The way installment credit impacts your credit score is a tad more straightforward. Your payment history is the single most significant factor in deciding where your score falls. Missed payments on installment credit will drag down your credit rating.


Despite these two options being common forms of credit, there’s still a lot of confusion surrounding revolving vs. installment financing. Here are answers to some of the most common questions.

Is a personal loan installment or revolving?

The term “personal loan” means that someone has taken out financing on a personal basis rather than for business. Working out whether it’s a personal loan installment or revolving credit isn’t always clear. Personal loans could apply to anything from borrowing money to cover a home renovation project, debt consolidation, or a vacation loan.

Is a credit card an installment loan?

Credit cards are a type of revolving loan because you can continually borrow against your balance until you reach your limit. Whenever you pay back a portion of your outstanding balance, that money becomes available to borrow again. Ordinary installment loans are limited to a set amount, and you cannot continually borrow against the total balance.

Is an auto loan installment or revolving?

Figuring out if an auto loan is installment or revolving is simple. You borrow a set amount, and you cannot continually borrow against it. While it’s possible to use your car as collateral for a personal loan, this is a separate type of loan. To put it simply: auto loans are always a form of installment loan.

What does a revolving loan mean on my credit report?

Revolving vs. installment credits affect your credit score differently. Revolving loans make up practically all of your credit utilization ratio. Your credit utilization ratio is how much available credit you have compared to how much of your credit you actually use. While you can borrow up to 100% of your total limit, this can negatively affect your credit rating. You should aim to use 35% or less of your total credit limit to optimize your credit rating.

What does an installment loan mean on my credit report?

Installment loans are also crucial for your credit score. Unlike a revolving loan, your installment loan increases your credit rating by enhancing your payment history. Regular monthly repayments improve your credit history, whereas missed payments will hurt your credit history. Unlike the credit utilization ratio, you can borrow as much with an installment loan without impacting your credit rating.

Find Your Funding with L3

Installment loans and revolving credit are commonly used throughout personal and business finance. Depending on what you want to use the money for, one type of credit may present some benefits over the other. Many people choose to take out installment loans to finance a business expansion or a mortgage, whereas credit cards are preferable for smaller purchases.

Need funding for your business? L3 Funding specializes in merchant funding to help entrepreneurs make their business dreams a reality. For help finding the right financing option for you, contact L3 Funding today.

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How to Secure Dental Practice Financing | L3 Funding

The Ultimate Guide to Dental Practice Financing

Starting your own dental practice turns you from a practitioner into a businessperson. However, running your business while providing the best possible service for your patients means wearing multiple hats at once.

The greatest challenge of launching your own practice is finding the best dental loans for your needs. Let’s jump into what you need to know about dental practice financing and securing a loan for dentists that will allow you to plant the seeds of a flourishing new business.

What is a Dental Practice Loan?

The dental business has several advantages that make this industry attractive to lenders. For example, dentists commonly report six-figure annual incomes. Healthy incomes make these practitioners an attractive prospect.

Dental businesses are also largely insulated from economic downturns. While people may skip eating out or going on vacation during a recession or a pandemic, most people are still likely to address crippling toothache.

Business loans for dentists are relatively simple to secure, and you already have the inherent advantages of the profession to fall back on. Securing the best dental financing can enable you to address expenses ranging from the rent of your building to state-of-the-art equipment to your first employees.

Different Types of Loans for Dental Practices

Your dental business loan is designed to help you establish your business and see you through growing pains that come naturally to any new company. There are several types of financing available to you. You need to understand the ins and outs of each dental practice financing option so you can make the right move for your venture. 

Here are some of the most common dental practice loans and the pros and cons of each.

Equipment Financing

The equipment required for your dental practice largely depends on your specialization. For example, a family dentist will need different equipment from one specializing in cosmetic procedures, such as crowns and veneers.

Equipment financing helps you finance the purchases you want and need to provide your services. It includes the basics like X-ray apparatus, handheld dental tools, and patient chairs. You can also invest in advanced technology to help your practice stand out from the crowd.

Many new “dentalpreneurs” find themselves shocked at the cost of equipment in today’s market. Dental practice loans allow you to make those purchases without breaking the bank or going into debt.


  • Assume complete ownership of your equipment immediately.
  • Spread out the cost of expensive equipment that would otherwise be out of your budget.
  • Increase your future revenues by having the necessary equipment available.


  • Equipment financing is strictly limited to equipment purchases , leaving you with less flexibility.
  • These loans typically have higher rates than traditional loans.
  • Assuming full ownership of equipment in the fast-paced dental industry could leave you with a significant liability.

Startup Business Loan

Another option for dental practice financing is a startup business loan. These loans are specifically designed for dentists establishing their own practices for the first time. Aspiring business owners do not need to own an existing dentistry clinic already. All you need is a firm business plan and a reasonable credit history to qualify.

Startup business loans are available from several providers, including major banks and online investors. Make sure you do your research and shop around to ensure you are getting the best rates.


  • You have as much flexibility as you want to use your capital on anything. It could help purchase equipment or function as a dental office loan.
  • There are lots of providers, enabling you to find the lowest dental practice loan rates.
  • Startup loans usually come with more manageable loan rates.


  • Startup business loans can be more challenging to secure because they rely on your personal credit score.
  • Taking out large amounts can mean restricting your cash flow from day one.
  • You may need to tie up your personal assets to get approved for these dental practice loans.

U.S. Small Business Administration (SBA) Loans

The SBA does not provide any loans to any businesses. Instead, they guarantee loans to encourage private lenders to support new businesses. Lenders have the comfort of knowing that the SBA has guaranteed up to 85% of the loan amount. It enables them to take risks by investing in dental professionals who want to form their own clinics.

Strictly speaking, SBA loans function like any other business loan. The only difference is the Federal government has guaranteed them.


  • SBA loans are more affordable for business owners because of their favorable terms.
  • You benefit from capped interest rates, meaning that you will always be aware of how much you will be expected to pay per month.
  • Choose from both small and large loan amounts, so you get the loans for your dental practice that match up with your needs at the time.


  • SBA loans are notoriously difficult to secure. Strict criteria can make qualifying extremely difficult for applicants.
  • The application process is known to be slow and clunky. Expect to wait months for a decision on your application.
  • SBA loans come with a lot of rules on what you can use the money for. You have less flexibility than with other lending options.

Business Line of Credit

Taking out a business line of credit gives you a form of revolving credit to tackle those down periods and demanding billing cycles.

Think of a business line of credit as your dental practice’s personal credit card. You take out a business line of credit for a set period and only make repayments on anything you borrow. You’re not obliged to borrow any money, making it an excellent fallback option during your business’s early months and years.


  • Meet sudden and unexpected cash flow demands. If a customer is late paying, your business line of credit can avoid you going into the red.
  • You only pay back what you borrow when you borrow it. Smart utilization of a line of credit can prevent you from assuming bad debt.
  • Take advantage of opportunities with the maximum flexibility inherent within a business line of credit for your practice.


  • Business lines of credit often incur far higher fees than other lending options. You also need to account for the elevated interest rates.
  • Many lenders will only approve applications for business lines of credit from established businesses, meaning you’ll need to rely on a high personal credit score.
  • Most lines of credit come with lower borrowing ceilings, making them unsuitable for larger business purchases.

Merchant Cash Advance

Merchant cash advances can be used to boost your financing temporarily. If you’re experiencing slow periods or need to confront an emergency expense, a merchant cash advance can quickly get the money into your pocket.

Applying for a merchant cash advance is relatively simple because all you need are your previous numbers. The amount you can borrow and for how long depends on your business’s finances. You’re essentially borrowing against future transactions.

A merchant cash advance could be the solution if you need money quickly to get your business through a tough spot.


  • Get immediate access to cash. Borrowing against future payments means that most businesses get approved within a few days.
  • Lower credit scores are accepted since you already have something tangible in the form of future revenues.
  • There are no fixed monthly installments. More of your debt will be paid off if you have a good week. It gives you flexibility in your repayments.


  • Be aware of high interest rates. Merchant cash advance providers don’t always offer affordable options.
  • Higher payment frequencies can hurt your cash flow, leading to further problems running your practice.
  • Successful repayments will not improve your credit score because such transactions are not reported to the three major credit reporting agencies.

What Do You Need for a Dental Practice Loan?

It’s important that when applying for dental practice financing, you keep your application organized, know the right questions to ask, and choose the right lender. So, what are the most critical aspects of applying for a dental practice loan?

3 Questions to Ask Yourself Before Applying

There are three crucial questions to ask yourself before applying. Here’s a rundown of each question and what they mean.

Do I Have Good Credit?

Lenders want to see that you have a positive personal credit score. Check your credit score with your bank or credit card company. Anything above 670 is considered good, whereas anything above 740 makes you a tantalizing prospect for lenders.

Do I Have a Business Plan?

All lenders will ask to see a business plan. The SBA has plenty of free business plan templates online to help you create your own. A business plan maintains all the details of how your business will operate, its services, and how it will appeal to the local market.

Do I Have Access to Group Discounts?

Pay attention to both administrative costs and origination fees. Take advantage of group discounts. You may be eligible for group discounts if you’re a member of ADA or another industry organization. Factor these discounts into your business plan. They not only reduce your costs but potentially point you in the right direction of a suitable lender.

5 Things You Need to File Your Application

Filing your application requires time and attention to detail. Not having the required documentation or meeting the lender’s minimum requirements will delay your application or see it rejected.

Here’s what you need to file your application:

  • Minimum Credit Score – Since you’ll be using your personal credit score, make sure you meet the lender’s minimum requirements. You can obtain a free copy of your credit once a year from each of the three major credit bureaus: Equifax, Experian and TransUnion.
  • Business Plan – Fill out a comprehensive business plan. You don’t need to know everything at this stage, but make your best guess while keeping your projections reasonable. Remember, the more thorough, the better. 
  • Tax Returns – Provide copies of your last two to three years of tax returns. Lenders will want to see what your previous income was.
  • Licensing/Certifications – Bring along your documentation proving that you are a qualified and experienced dentist.
  • Identification – All lenders will need to make copies of your identification. Make sure you bring at least two forms of ID, such as a driver’s license or your passport.

How to Apply for Dental Practice Financing

The most time-consuming aspect of setting up your practice will be securing the funding you need to get your business off the ground. Thankfully, the application process is essentially the same as applying for any other type of loan.

Follow these steps for securing dental practice financing.

Step One – Compare Lending Options

The first step is to find a lender that fits your requirements. First, you will need to pinpoint your ideal lending option and then shortlist some lenders that provide that option. Using loan comparison platforms can help you slash the time you spend tracking down lenders and figuring out their rates.

Take your time with this step. Thousands of lenders across the country offer different terms and conditions. Make sure you leave enough time to apply for your loan. Some lending options may take weeks to approve, whereas others may take months.

Step Two – Complete the Lender’s Application Form

Most application forms ask the same questions. You will need to enter some basic details about you and your proposed business.

Many lenders use automated verification systems, so ensure you fill out every field to the best of your ability. You may even be able to attach documents to your initial application form. If this is the case, now is the time to attach your completed business plan.

Step Three – Provide Company Accounts (For Existing Businesses)

Step three applies to established dental practices only. If you’re applying for financing to get a new piece of equipment, make your latest hire, or expand your operations, you will need to provide a copy of your recent company accounts.

Go as far back as you possibly can. Generally, two to three years should be enough, but providing this information won’t harm your application if you have five-year accounts. If you’ve yet to establish your business, you will be able to supply your salary/tax returns from the last few years.

Step Four – Wait for an Answer

Lender waiting times vary from lender to lender. However, you can typically expect to hear back within a few days to a week. Many lenders may ask you for additional documentation or want to speak to you directly.

Expect to be asked for further details if you’re a new business, have an average credit score, or you’re asking for a sizable loan amount.

Step Five – Receive Your Money

If accepted for a dental practice loan, the money should take just a few business days to arrive in your business bank account. You will now be free to spend the money in accordance with your loan’s terms. You will begin making your repayments immediately.

If rejected, begin searching for other lenders who may be willing to lend to you.

Find Your Funding with L3

Applying for financing is the single most crucial step in launching your dental practice. With so many financing options and lenders to deal with, the process may feel overwhelming. 

Get the help and financing you need with L3 Funding. Our team has a long history of helping small business owners secure the financing that makes sense for their ventures.

We also provide merchant cash advances for businesses that need money fast. To learn more about merchant funding or other lending options, contact L3 Funding today.

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A Physician’s Guide to Medical Practice Loans | L3 Funding

How to Secure Medical Practice Financing: A Comprehensive Guide

As a new physician, you likely envision opening a medical practice. Starting a business from the ground up is exciting and empowering. You now have a say in how things run, and control of the company is in your hands.

However, you can only achieve these results once your business is off the ground and running. The standard avenue toward reaching this goal is through medical practice loans.

Today, let’s dive into how to start a medical practice with minimal self-investment and how to get approved for a physician practice loan that can help you make it happen.

What is Medical Practice Financing?

Medicine financing is an essential source of financing for medical practice, specifically for doctors and other medical professionals.

Medical practice financing typically consists of two main components: revenue sharing for services and risk-sharing for the investment in the doctor-patient relationship. The structure of funding for medical practice is determined by various factors, including the amount of reimbursement doctors can claim, the amount of risk in the investment, and the degree to which the risk is shared.

However, medical practice financing has changed over the years, and the current model is very different from the old.

Regarding the changing landscape of funding for medical practice, you’ll be better served with a continuously evolving model in response to the changing needs of your organization and your practice.

Once you’ve acquired a medical practice loan, it’s possible to use this finance for various purposes, such as operational expenditures, purchasing stock or equipment, buying an existing practice, or beginning a new practice.

Common Types of Medical Practice Loans

Many financial organizations, including banks, internet lenders, and other businesses, offer medical business loans. Occasionally, you may be able to get private funding.

For medical practice lenders, these are some of the most common options:

Small Business Administration (SBA)

The Small Business Administration (SBA) does not provide small business loans directly to medical practitioners but instead works with lenders. It is easier for lenders to lend to small firms since the government backs SBA loans. A variety of funding options are available through SBA-affiliated lenders.

These medical practice loans are available in various amounts, allowing doctors to get the capital they need to grow their practices. SBA loans often include cheaper down payments, competitive interest rates, and other advantages. In some cases, the SBA does not need security for loans.

SBA loans may be an alternative if you’re experiencing trouble securing a loan from other lenders.

Bank Loans

If you want a medical private practice loan through a typical bank or credit union, weigh the benefits and drawbacks carefully. It’s possible to receive cheap interest and extended payment periods, but additional restrictions exist on how you may use the money in your medical business. If you’re looking for a traditional loan from a bank or credit union and have terrible credit, you could have trouble finding a lender that will accept your application. As a result, your ambitions for your medical practice may be put on hold while you wait for a loan. On the other hand, online lenders can provide finance far more quickly and with fewer requirements than traditional financial institutions.

Online Lenders

Online lenders have much better acceptance rates for small business loans than banks and credit unions. If starting a medical practice, you may look at online lenders, which have more permissive rules and are more inclined to support early-stage businesses.

Most of the time, capital is available for withdrawal within 24 hours or less. Many other types of loans are available, including term loans, lines of credit, invoice finance, etc. In addition, internet lenders are well-known for their lightning-fast loan approval processes.

Term Loans

A term loan usually comes to mind when you think of a standard company loan. Loans are repaid by the borrower over a predetermined period, including interest.

These medical practice term loans, like the bank loans we covered, are suited to the needs of physicians and specialists. You would use a medical-only alternative lender instead of a typical bank for this type of loan rather than the general public.

What are the main differences between this loan and a bank loan? What we mean is this: As small company owners had challenges getting funding from traditional banks during the financial crisis of 2008, the rise of alternative lending emerged. Accessibility and cost are the two main factors in this situation. Many more borrowers now have access to funding choices since non-bank internet lenders have lowered their qualifying rules, making it easier for them to qualify. However, because lenders are taking on greater risk by making these loans, borrowers must pay a higher interest rate.

In addition, even if the loan conditions are favorable, some medical financing companies have strict requirements for the customers they select. To get a business loan, you may need to be in the company for several years with an excellent credit history and have a sizable yearly income to meet their criteria.

Business Lines of Credit

It’s not uncommon to see comparisons between business lines of credit and credit cards. There is a reason for this: Lines of credit have more significant financing and cheaper interest rates than personal loans.

Regarding funding, there are several advantages to using this method. You’ll be given a predetermined credit limit from which you can draw as needed. You will only be charged interest on what you borrow. There will be more money available for use when your balance is reduced.

When you aren’t sure exactly how much a project or refurbishment will cost, a business line of credit might come in handy. It is possible to utilize them to support a wide range of business needs, including running costs, supplier purchases, advertising, renovations, staff compensation, and more.

Equipment Loans

A medical equipment loan is primarily used to finance the establishment of new healthcare firms, the expansion of existing facilities, and the upgrading of medical equipment. It’s a long-term loan that needs to be backed by collateral and can also be used for the company’s supplementary needs. Businesses can borrow money at a low-interest rate and choose their payback terms. This form of loan is available from several well-known financial institutions around the country.

The firm will require additional financing to keep up with the demand for medical services. The following are a few of the most critical aspects of this loan:

  • To use the loan, you must only purchase medical equipment and its associated needs.
  • Banks cater to the specific financial requirements of healthcare providers with a range of tailored services.
  • The time it takes to repay a loan typically varies from 12 to 84 months.
  • Lenders give financial support at affordable rates and, more crucially, provide solutions specific to the company’s needs because of the nature of large projects.
  • Loans beyond a particular amount need collateral.
  • Finance for medical equipment, projects, operating capital, and other credit requirements are covered by the loan.

Who Can Apply for a Medical Practice Loan? 

Many different types of healthcare and wellness businesses might benefit from medical practice funding. Regarding the nature of your services, lenders aren’t likely to be overly picky.

Medical practice loans have been authorized for the following types of businesses:

  • Physicians
  • Plastic surgeons
  • Mental health specialists
  • Optometrists
  • Pediatricians
  • Dermatologists
  • Wellness professions (such as Chiropractic)

Medical Practice Loans: Things to Consider 

Regardless of the sort of loan or other financing option you choose, there are standard criteria for medical practice loans. As a result, it’s a good idea to plan, especially if you have a poor credit rating and will take some time to improve it or locate all necessary paperwork and licenses.


Potential lenders will examine your personal and business finances to assess whether your medical practice is worth the risk they would take by granting you a physician business loan. You may be asked to provide various financial documents when applying for a personal loan. The list of items may include your most recent personal and business financial records (such as bank and credit card statements), your most recent tax return (if you have one), and information about any previous business loans. Whether your medical practice is a new venture or has a long history will affect the documentation needed. The sort of medical practice financing you are eligible for will be influenced by the length of time you’ve been in business.


Prospective medical practice lenders will heavily weigh your credit score when evaluating your application for any financing. You need “good” or “excellent” credit to get the interest rates and repayment condition score. Don’t give up if your credit score isn’t at least 680 out of a possible 850. It is possible to acquire financing for your medical business from various lenders. If your credit score isn’t entirely where you’d like it to be, online marketplaces with several lending partners may be able to help. You may improve your credit score by paying your bills on time and managing your creditor mix and the number of recent queries.

Licenses and Documentation

A vast array of legal documents, business permits, medical licenses, and registrations accompany your professional qualifications. These documents may already be in your possession, or you may have to search for them. Depending on which sort of medical practice loan you are applying for, your lender may or may not require these papers. All of this depends on the kind of finance, lender, and practice you run.


To secure a medical practice loan, your lender may require that you provide collateral. Most doctor practice financing doesn’t require collateral since you may use the medical equipment you’re purchasing as collateral. If you default on a loan or payment, the lender has the right to seize your collateral.

Medical Practice Funding: How Does It Work? 

Funding for medical practices can assist doctors in overcoming the specific difficulties they face, including:


Due to the high cost of medical supplies and the challenges of collecting payment from patients, keeping an adequate supply can be problematic.


In addition to standard equipment such as exam tables and computer software, medical practices of all specializations will require specialist equipment, such as radiography, defibrillators, EKG machines, lab equipment, and imaging equipment. The equipment they need all depends on their area of expertise


Streamlining patient communication, enhancing billing processes, and making it simpler to exchange information with other physicians or between locations are some benefits of digitizing medical data. 


Slow-paying insurance companies, Medicare and Medicaid payment delays, and non-paying clients can lead to cash flow issues for small business owners.


Due to the elevated danger of sickness, medical practices require particular types of insurance, such as malpractice and workers’ compensation. 


Many medical offices are battling to stay open with fewer patients allowed in at a time, service limits, and higher costs for personal protective equipment (PPE) and other preventive measures.

If you’re a medical practice, you may use medical practice funds for more than just getting through tough times.

Real Estate

Purchasing your office space may lower your monthly expenditures while increasing your assets, extending your firm to another location. 

Purchasing a Practice

Instead of beginning from scratch, buy an existing one with a business loan. To sell a medical practice, many retiring physicians are looking for the next generation of doctors (with a good credit rating!)

Expanding your business by serving additional areas, providing new services, and adding new patients is also an excellent method to do so without making significant expenditures in marketing or development.

Hiring Employees

Taking on more patients without compromising the quality of care is possible with additional doctors, nurses, and other support staff to your team.


When starting a new practice or moving to a new location, adding new staff and accommodating more patients, or offering new or extended services, it’s imperative to advertise your clinic, whether it’s through print ads, a website redesign, or direct marketing.

Finance Your Practice with L3

Getting a medical practice off the ground requires considerable knowledge and understanding surrounding the potential investments you can acquire before you start seeing patients. 

To help medical and wellness practitioners realize their company aspirations, L3 Funding offers a wide range of financial services, including merchant cash advances, business loans, and other options.

Learn more about medical practice financing or apply for merchant funding with L3 today!