As an attorney that works with healthcare professionals, including dentists, we are running into issues with lenders when it comes to the purchase and sale of dental practices. It is really the same issue that we are seeing with other healthcare professionals. So, I thought I would call this out, as a concern, and provide some comments. During the COVID-19 pandemic, I want to ensure that doctors are exploring all options for funding of a dental practice purchase or educating the buyer about the options, if you are on the seller side. As we all know, the economic effects of COVID-19 have been widespread, affecting all businesses in some way. And, we are seeing some great responses, and some not so great responses from lenders.
As an example, we are seeing some lenders failing to move forward on dental practice acquisitions and citing various reasons for their failures to move forward, much of which has to do with the uncertainty in the market. Yet, we have deals that need to be done and doctors that are ready, willing, and able to buy or sell. The good news is, we are seeing other lenders stepping up to assist our dental practice clients.
Those lenders, however, that are backing away or pausing are causing us frustration. Why? Well, we had the federal government step up with significant stimulus packages and funding for business owners, which the traditional banks have significantly benefited from. The lenders are funding these deals and have complete guarantee and backing of the federal government. That is, the banks are making money and have no risk. Yet, some of those same traditional banks that say that they are your partners when it comes to the dental community are not stepping up and funding deals.
Recently, however, we have seen other third-party lenders step up and fund those deals. And, because of that, we have deals moving forward. And, as long as the doctors are doing their due diligence and are making informed decisions on whether to go forward or not, that is a good thing. So, I would like to mention one of those lenders that have been backing dentists and moving forward with deals. Lendeavor is one of those lenders. Thus, we would encourage you to visit their website at lendeavor.com and determine whether they may be a good fit for you. From looking at their website, they are a boutique lender in the dental practice space and should be considered.
Nardone Comment: To be clear, I have no relationship or affiliation with Lendeavor. I am simply seeing them do deals and therefore wanting to compliment them for that. Our dentists need to be backed by their lenders in good times and bad.
Of course, importantly, you need to consider all options and what works for you when you are borrowing money. But, at the end of the day, if we have traditional dental lenders that are not willing to step up in difficult times, you have to find partners that are willing to have your back. My goal, among others, as your dental practice attorney and advisor, is to ensure that we minimize disruptions during the dental practice acquisition process to ensure a win-win for both sides of the deal. With that in mind, as part of the dental practice acquisition, we need lenders that are willing to invest in the practice owner; not just when things are going good, but when things are not so good, and when there is uncertainty in the market. That is when you really know who your friends and partners are. Lendeavor seems to be doing that at this time, and we applaud them for that.
In sum, we recommend that our doctor and dental practice clients consider all funding options. We need to take swift and immediate action to ensure that we minimize disruption to maximize profits, including any disruption in losing the funding of an anticipated dental practice acquisition. Therefore, if you have questions related to business disruption because of funding, please contact me. I would be happy to work with you, address your concerns, plan, and outline your options with you.