A new dental practice can get equipment financing, or a larger start-up loan, with no business history, because the lender underwrites the dentist and the plan when there's no revenue to review. Approval turns on your license, personal credit, current income, the cash you put in and your projections, with the equipment as collateral.
How does a new dental practice get an equipment loan with no business history?
A new dental practice gets equipment financing approved with no business history by giving the lender something other than past revenue to underwrite. For SBA-guaranteed loans, 13 CFR 120.150 (as in effect October 1, 2026) says lenders may consider the credit score or credit history of the applicant and any guarantors, the earnings or cash flow of the applicant, and any equity or collateral. Conventional and equipment lenders write their own policies, and each weighs the pieces differently.
| What the lender reviews | Why it matters before you open | What to bring |
|---|---|---|
| License and experience | Shows you can legally produce the revenue in the plan | State dental license, CV, production reports from your associate job |
| Personal credit | Stands in for a business credit file you don't have yet | Written explanations for late payments or collections |
| Associate and household income | Shows how personal bills get paid while the schedule fills | Pay stubs and personal tax returns |
| Cash to inject | Your own money at risk shrinks the loan | Bank statements showing where the cash came from |
| Business plan and projections | Projected cash flow replaces historical cash flow | Monthly projections with assumptions for patients, fees and payroll |
| Collateral | The equipment secures the loan, and some lenders look at other assets | Vendor quotes, a list of real estate you own and its liens |
Lender requirements differ, so treat the last column as a starting list. Entity choice belongs on it too: SBA's SOP says businesses that need professional licenses to operate are eligible provided the ownership structure meets the requirements of the state where they're located.
A sample equipment budget for chairs, imaging and CAD/CAM
A start-up with no revenue history can finance dental chairs, imaging and CAD/CAM equipment in one package, and the size of that package shapes the rest of the approval. Every figure below is a placeholder assumption for a leased space with three equipped operatories. We found no official source for dental equipment prices, so replace each line with a written vendor quote.
| Item | Assumed cost | Can it wait? |
|---|---|---|
| Three operatory packages (chair, delivery unit, light, stools) | $66,000 | No |
| Cabinetry and sterilization center | $46,000 | No |
| Compressor and vacuum system | $14,000 | No |
| Intraoral X-ray units and sensors | $24,000 | No |
| Panoramic or cone-beam imaging unit | $75,000 | Depends on your procedure mix |
| Handpieces, instruments and small equipment | $30,000 | No |
| Computers, network and practice software | $25,000 | No |
| Core package | $280,000 | |
| Intraoral scanner | $25,000 | Often, if you start with conventional impressions |
| Chairside CAD/CAM mill and furnace | $55,000 | Often, if a lab makes your crowns at first |
| Full package | $360,000 |
Our view is that a new practice should finance what it needs to treat patients on opening day and add the rest once production supports it. At an assumed 9.5% over 84 months, the $80,000 scanner and mill add about $1,308 a month and roughly $29,800 of interest, and those payments land in the months when the schedule is emptiest.
How SBA lenders structure a start-up dental package
A start-up dental practice may look to an SBA lender because one 7(a) loan can cover equipment, build-out and working capital, while an equipment loan is built around the equipment itself. These rules come from SOP 50 10 8.1, effective October 1, 2026.
- Equity injection. SBA treats a business as a start-up when it has been generating revenue for 1 year or less. The SOP says all 7(a) loans made to a start-up require a 10% equity injection based on project cost (all costs required to become operational), though for SBA Express it leaves the equity decision to the lender's business judgment. Cash from a personal loan counts only when repayment can be shown to come from a source other than the practice's cash flow, and the salary the practice pays you doesn't qualify.
- Projections. A standard 7(a) loan (over $350,000) needs detailed projections showing debt service coverage of 1.15 or better within 2 years of funding or, for construction projects, within 2 years of the end of construction. A 7(a) Small loan ($350,000 or less) can rest on 12-month projections showing 1.10 within one year.
- Term. Equipment loans should generally not exceed 10 years, or up to 15 if the IRS asset class useful life supports the term, and working capital and leasehold improvement loans may not exceed 10. Up to 12 months can be added when needed to finish installation.
- Rate. The maximum variable rate above $350,000 is Prime or SBA's Optional Peg Rate plus 3.0%, set from the base rate on the first business day of the month. With the bank prime rate at 7.00% on October 1, 2026 (Federal Reserve H.15), Prime plus 3.0% is 10.00%.
- Guaranty. Anyone who owns 20% or more must give an unlimited personal guaranty.
- Collateral. In testing whether a standard 7(a) loan is "fully secured," new machinery and equipment (excluding furniture and fixtures) counts at no more than 75% of its price minus any prior liens. If there's a shortfall, the lender must take available equity in personal real estate, though no lien is required when equity is under 25% of the property's fair market value, and on a standard 7(a) loan life insurance in the amount of the shortfall is required for sole proprietorships, single-member LLCs and businesses otherwise dependent on one owner's active participation. The SOP also says a loan must not be declined solely because collateral is inadequate.
Put the $280,000 core package together with an assumed $250,000 build-out and $100,000 of working capital, and the project costs $630,000. A 10% injection is $63,000, which leaves a $567,000 loan. At an assumed 10.00% over 10 years the payment is about $7,493 a month, or $89,915 a year, so the projections have to reach roughly $103,400 of operating cash flow (1.15 times debt service, assuming no other business debt) within two years. Even if all $280,000 of equipment counted at 75%, that's $210,000 of collateral against a $567,000 loan. The example leaves out fees such as SBA's upfront guaranty fee.
Buying an existing practice is underwritten differently. For an initial acquisition, the default category for a 7(a) change of ownership, the SOP sets a 10% equity injection that can't be reduced and requires coverage of 1.25, on a historical or adjusted basis, from the last fiscal year or the average of the last two. The lender may not rely on your post-closing projections to meet that test, so a start-up is approved on your forecast and an acquisition on the seller's record (see business acquisition loans).
Equipment-only loans, leases and specialty dental lenders
Dental practice start-up equipment financing outside SBA comes from banks with healthcare practice programs, equipment finance companies and vendor programs. Their requirements for personal credit, collateral, down payment and guarantees follow each lender's own policy, so there's no standard to quote. Ask every lender the same questions:
- How much of the invoice is financed, and are installation, software, training and sales tax included?
- Is this a loan or a lease, and what do you own at the end? Our lease vs finance guide covers the trade-offs.
- Does the lien cover only the equipment financed or all practice assets?
- Who signs a personal guarantee, and is it unlimited?
- What does paying off early cost?
What six months of deferred payments costs
Deferred payment structures give a new practice time to build its patient base before full payments start, and they cost money, so ask for the total in dollars. The table runs the $280,000 core package at an assumed 9.5% fixed rate with an 84-month term. In the no-payment rows we assume unpaid interest is added to the balance each month, which you should confirm with the lender.
| Structure | Months 1-6 | Payment after | Total interest | Extra cost |
|---|---|---|---|---|
| Standard, 84 level payments | $4,576 | $4,576 | $104,410 | None |
| Interest-only for 6 months, then 78 payments | $2,217 | $4,825 | $109,664 | $5,253 |
| No payments for 6 months, then 78 payments | $0 | $5,059 | $114,598 | $10,188 |
| No payments for 6 months, then 84 payments (90 months in all) | $0 | $4,798 | $123,035 | $18,625 |
Deferral buys cash when you need it most, at a price here of about $5,300 to $18,600. The payment after the deferral is higher than the standard payment in every row, so build your projections on the later figure. On SBA loans, the SOP lists any interest-only payment period among the terms a 7(a) note must state, and how long it runs depends on the lender and current program rules.
▦Estimate your equipment financing paymentsRun the numbers in the equipment financing estimator →▸Documents to gather before you apply
Lender checklists vary, but this set covers what the sections above call for:
- State dental license and CV
- Personal tax returns, plus pay stubs or production reports from associate work
- A personal financial statement listing assets, debts and real estate
- Bank statements documenting your cash injection and its source
- A business plan with at least two years of projections and their assumptions
- Itemized vendor quotes, including installation and software
- Lease or letter of intent for the space, plus contractor bids for the build-out
- Entity documents and your EIN
Our loan documents checklist goes deeper.
Getting start-up offers side by side
Each lender weighs a missing track record its own way, so start-up offers can differ on down payment, term, deferral and collateral. EQ Funding doesn't lend. One application goes to lenders who compete for the deal, and each lender assesses your credit and repayment ability and sets its own approval and terms. Compare the payment after any deferral ends, total interest and fees, the lien and the guarantee. Start with equipment financing, or see startup capital financing if build-out and working capital are part of the request.