Monthly repayments and total cost for a practice purchase, buy-in or squat loan — plus the debt-service cover ratio a lender will actually look at.
Add this to see lender-style affordability cover.
Illustrative figures using 2026/27 rates and simplified assumptions — not advice, and no substitute for a proper calculation on your real numbers. Ask us for the accurate version — it's free.
Dentistry borrows well — the risk is the wrong structure, not a refusal. We test affordability against real accounts, advise the tax treatment, and introduce clients to a dental-specialist lender with the numbers already prepared.
This is a standard capital-and-interest repayment, the way practice acquisition loans are normally written: equal monthly payments across the whole term, interest charged on the reducing balance, nothing left at the end. Early payments are mostly interest and late payments are mostly capital, which is why overpaying in the first few years is worth so much more than overpaying in the last few.
The cover figure is debt-service cover: adjusted EBITDA divided by a year of repayments. It is the ratio a credit committee looks at first, and lenders generally want to see roughly 1.25–1.5× or better. Cover of 1.0× means every pound of practice profit goes to the bank, leaving nothing for tax, drawings, or the boiler failing in February.
On the defaults — £450,000 over 15 years at 7% — the monthly repayment is £4,045. Over the full term you repay £728,051, of which £278,051 is interest: more than 60% of the sum borrowed, which is the number most buyers have never seen written down. A practice with £120,000 of adjusted EBITDA would show cover of 2.47× against that loan, which is comfortable. The same loan against £70,000 of EBITDA gives 1.44× — inside tolerance, but with very little room for a rate rise or a quiet quarter.
Arrangement and valuation fees, legal costs, any capital repayment holiday at the start, and the working capital you need on day one for stock, payroll and the gap before the first NHS payment lands. Variable-rate loans also move: at 8% rather than 7%, the same £450,000 over 15 years costs about £256 more a month. Model the rate you might be paying in three years, not only the one you are offered today. If the borrowing is for an acquisition, our buying guide covers what else the cash flow has to carry in year one.
Cover gets you through the first filter, not the whole process. Expect questions about the deposit you are putting in and where it came from, your clinical track record and how many days you will personally work in the practice, the length of the lease against the length of the loan, and whether the term runs past the age you intend to retire. Personal guarantees are normal in dental lending rather than a red flag, but their scope is negotiable and worth negotiating.
The single thing most within your control is the quality of the pack you present. Lenders price for uncertainty, so accounts that arrive clean, with the adjustments explained and a cash flow that survives a rate rise, routinely secure better terms than the identical practice presented badly.
These tools use sensible simplifications. A free conversation gets you the real calculation — and usually a couple of things worth fixing.
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