Dental Practice Loan Payment Calculator

How does the loan payment calculation work?

For principal P, a monthly rate r, and n monthly payments, the payment is P × r ÷ (1 − (1 + r) raised to the power −n). The entered nominal annual interest rate is converted to a monthly rate by dividing by 1,200. At a zero interest rate, the payment is principal divided by the number of months. Fractional years are rounded to a whole number of monthly payments.

This calculator treats the rate as a nominal annual interest rate, not an APR that incorporates fees. Interest accrues monthly in the model. A lender may use contractual conventions that differ. Payment amounts are displayed rounded to the nearest dollar, while the calculations retain precision.

Which inputs should you use?

The prefilled $750,000 principal, 7% rate and 10-year term are illustrative inputs. They are not an actual offer, market survey, or prediction of an approval. Change them to explore the payment sensitivity or to match a lender's written proposal.

What does the result leave out?

The model excludes origination fees, closing costs paid separately, insurance, taxes, property charges, prepayment penalties, variable-rate resets, interest-only periods and balloon payments. It does not determine whether a borrower meets eligibility, collateral, guarantee, liquidity or credit criteria.

SBA describes monthly principal-and-interest repayment for most of its term loans and notes that variable-rate payment amounts may change. That distinction matters: a constant-rate calculator cannot forecast a loan whose rate changes. (Source: SBA: 7(a) loans.)

How should you use the payment in an acquisition budget?

Compare annual debt service with cash after the operating costs necessary to retain the practice's revenue. Preserve room for the buyer's income, equipment needs, working capital and uncertainty. Do not compare the loan payment with collections alone; collections must also fund operations.

Test a lower-collections case and a higher-cost case. Past cash flow may cover the payment. Your case may change with new staff costs, new rent or a different work schedule. The lender's approval and your own income requirement are separate tests.

How should you compare two loan scenarios?

Keep the principal constant first, then change either the rate or the term. Record the monthly payment, total interest and annual debt service for each scenario. This reveals the effect of that one change. If you change the amount, rate and term simultaneously, a lower payment can be difficult to interpret.

A longer amortization period can reduce the regular payment while increasing the time interest accrues. Compare both the payment burden and total cost, using the actual proposals. This tool does not calculate an APR that includes lender fees. A lower entered rate does not prove that the full loan costs less.

If a proposal includes interest-only payments, a balloon, a variable rate or staged funding, ask the lender for a schedule that models those features. Do not enter a teaser rate and assume the result describes the full loan. Preserve the lender's schedule alongside your scenario so the difference remains clear.

The underwriting guide explains how to connect repayment to a complete acquisition budget. Bring both the proposed financing and the supporting practice cash flow to that review. A mathematically affordable monthly payment is only one part of deciding whether the purchase works.

What is the next decision?

Request a written payment schedule and a complete uses-and-sources statement from the lender. Compare rates, fees, guarantees and conditions together. The calculation helps you ask focused questions; it does not commit any lender to fund the transaction.

What should you keep with a loan comparison?

Keep the lender's dated proposal beside the calculator result. Mark the amount borrowed, the costs paid from that loan and any cash you must provide. Note when payments start and whether the rate can change. A missing term should stay open until the lender answers it.

Use a separate row for fees paid in cash at closing. Those fees do not appear in this payment unless you add them to the financed principal. Do not add the same fee to both places. Ask the lender to reconcile your model with its own schedule before relying on the number in an offer.