100% Dental Practice Finance: Can You Really Buy With No Deposit?

The single biggest myth in dental practice buying is that you need a large cash deposit before a lender will talk to you. For a qualifying dentist, that is usually wrong. Specialist lenders routinely advance up to 100% of the goodwill and equipment value of a practice, and occasionally more once a working-capital tranche is added, meaning a first-time buyer can complete without putting down a deposit against those elements at all. This is not a loophole or a hard-sell product. It reflects the way lenders assess dentistry: a resilient, contract-backed, professionally regulated activity with a very low default record.

This guide answers the question buyers actually ask, "can I really buy with no deposit?", head on. We explain why 100% lending exists, exactly what it covers and what it does not, the criteria you have to clear, the security and personal guarantee that stand in place of a deposit, how much you can borrow against a practice's earnings, and what to do when a lender comes back at 90% instead of 100%. The tax and structuring of the deal (how goodwill is relieved, how the purchase is apportioned) is covered in our sibling guides and summarised here with a link, because this page stays firmly in the lending lane.

Can you really buy a dental practice with no deposit?

Yes, in the common case. When people say "100% finance" for a dental practice, they mean the lender advances the full value of the goodwill and the equipment, which between them make up the bulk of most practice prices. Because those two elements are fully funded, the buyer does not need a cash deposit against them. That is genuinely different from a general business acquisition, where a lender would typically want 20% to 40% of the price in cash before lending the rest.

Two clarifications matter from the outset. First, this is business-purpose commercial lending to a trading dental business, not a residential or regulated mortgage, and the no-deposit feature has nothing to do with personal home lending. Second, "100%" refers to the goodwill and equipment. If you are also buying the freehold premises, those are funded through a separate commercial mortgage that is almost never advanced at the full property value, so a freehold purchase does still involve some equity. Our dental commercial mortgage guide covers the freehold side; this page is about the goodwill-and-equipment acquisition loan.

The professional category: why lenders back dentists

Banks and specialist lenders operate a professional-category approach to a small group of regulated occupations, dentists, doctors, vets and a few others, that they consider materially lower risk than the general market. For dentistry, several features drive that view:

• Regulated, insurable operators. Every practising dentist is registered with the General Dental Council and carries professional indemnity, so the lender is backing a vetted, accountable individual whose earning capacity is portable.
• Resilient, often contract-backed income. A large share of UK dental income flows from NHS General Dental Services or Personal Dental Services contracts administered by the NHS Business Services Authority, giving a predictable, government-underwritten revenue base that private-sector trading businesses rarely match.
• Very low sector default rates. Practices are sticky (patients rebook, NHS contracts renew) and the historic loss experience on dental lending is small, which is what lets a lender waive the deposit it would demand elsewhere.
• A regulated operating framework. Every provider must be registered with the Care Quality Commission, which gives lenders confidence in the standard and continuity of the operation they are financing.

In short, the deposit a general borrower puts down exists to give the lender a loss cushion. For dentistry, the professional category, the regulated operator and the resilient income together provide that comfort instead, so the cash deposit against goodwill and equipment can fall away.

What 100% actually covers

It helps to see how a practice price splits before you know what the loan is funding. A typical acquisition breaks down roughly like this:

Element	Share of a typical price	Funded at 100%?
Goodwill (the intangible value of the patient base and contracts)	~60 to 80%	Yes, in the standard case
Equipment and fit-out (chairs, imaging, surgery kit)	~10 to 25%	Yes, in the standard case
Opening working capital	Added on top	Sometimes, as a separate tranche
Freehold premises (if bought)	Separate	No, funded by a commercial mortgage

The goodwill and equipment loan is the core 100% product. Because some lenders add a working-capital tranche for the first trading months on top, you will occasionally hear of lending "above 100%", which simply means the facility exceeds the goodwill-plus-equipment figure to include an opening cash buffer. The tax treatment of these elements (goodwill amortisation relief at 6.5% a year on qualifying post-April-2019 purchases, and capital allowances on the equipment) is a structuring matter we keep to a sentence here and cover in the goodwill buying and selling guide. What matters for the funding decision is that the lender is advancing the value of assets that produce durable income.

The criteria: what makes you eligible

A no-deposit loan is not automatic. Lenders assess the buyer and the practice together, and both have to hold up.

On the buyer

• GDC registration and, usually, at least two years of post-qualification clinical experience. You do not need prior ownership experience, associates are the typical borrowers here.
• Clinical hours and capacity to run or clinically oversee the practice you are buying.
• A clean credit history. County court judgments, defaults or a thin file will weaken the case and can trigger a deposit requirement.
• A credible plan for the practice under your ownership, particularly if you are changing the NHS and private mix.

On the practice

• Verifiable, stable accounts. Lenders want to see consistent income and a believable goodwill valuation, not a spike in the year before sale.
• A defensible income mix. NHS contract income (checked against the NHS BSA position) is viewed favourably for its predictability; a heavily private book is fine but assessed on its retention record.
• Earnings that comfortably cover the loan, which is the affordability test covered below.

Where the buyer profile is thin or the practice's numbers are volatile, the lender does not necessarily refuse. It usually just moves the deposit dial: 100% becomes 90%, or a cash contribution is asked for. The financial due-diligence guide sets out exactly which numbers a lender (and your accountant) will interrogate before an offer is confirmed.

Security and personal guarantees when there is no deposit

If you are not putting cash in, the lender needs its security elsewhere. Expect two things:

• A charge over the business assets. A debenture or fixed and floating charge gives the lender a claim over the goodwill, equipment and receivables it has funded.
• A personal guarantee. As the borrowing director (for a company) or proprietor (for a sole trader), you personally guarantee the debt, so you are liable if the practice cannot repay. Lenders sometimes cap the guarantee at a proportion of the loan, and commonly require life or critical-illness cover to sit alongside it.

The personal guarantee is the honest trade-off for a no-deposit loan: the risk the deposit would have carried is transferred to you personally rather than sitting as lost equity. It is standard across professional-category lending and not a red flag in itself. What matters is understanding the extent of the guarantee and, where possible, negotiating a cap. The interest on the borrowing, because it is wholly for the trade, is generally deductible against practice profits under the ordinary HMRC rules on interest deductibility, a point your accountant will confirm and one we keep brief here.

Affordability: how much you can actually borrow

The headline valuation is not the ceiling. The real limit is affordability, and lenders size the loan against the practice's adjusted EBITDA: its earnings before interest, tax, depreciation and amortisation, adjusted to deduct a market-rate replacement salary for the owner's clinical work and to strip out one-off or non-trading items. The loan repayments then have to be covered by that adjusted figure with a margin, commonly a debt-service cover of around 1.25 to 1.5 times.

The figures above are illustrative only and not a quote. Actual rates, terms and cover requirements vary by lender and by the specifics of the practice and buyer. For a fuller view of the acquisition-funding options that sit alongside the 100% route, see our acquisition financing options guide, and to sense-check whether the purchase stacks up at all, is buying a dental practice worth it.

When 100% is not offered, and how to bridge the gap

Not every deal lands at 100%. A lender may come back at 90%, or ask for a cash contribution, when the buyer profile is thin, the practice's income is volatile, the price looks high against earnings, or the goodwill valuation is hard to defend. A shortfall does not kill the purchase. The usual routes to bridge it are:

• Put in the difference as cash, if you have the reserve, treating it as equity in your own business.
• Approach a second specialist lender. Appetite varies, and a bank that offers 90% is rarely the whole market. Another lender may be at 100% for your buyer type this quarter.
• Renegotiate the price. If the shortfall reflects a stretched valuation, the sensible fix is often a lower price, not more debt.
• Use a vendor deferment. The seller leaves part of the price outstanding, repaid from future profits, effectively covering the gap the lender will not.

Because lender appetite shifts and each specialist prices dentistry differently, a single 90% offer tells you very little about what the market as a whole will do. This is precisely where a broker who places dental deals regularly earns their fee: knowing which lenders are currently at 100% for a first-time associate, a single-site owner, or a group buyer, and packaging the affordability case to get there.

Where a broker and an accountant fit in

Two advisers do different jobs on a no-deposit purchase. A specialist finance broker finds the lender, structures the 100% facility, and negotiates the term, rate and guarantee. A specialist dental accountant stress-tests the target's accounts, builds the adjusted-EBITDA affordability case the lender relies on, and gets the tax and structuring right so the goodwill relief, capital allowances and interest deductibility all land correctly. On a first practice, using both is the norm, not a luxury, because the buyer profile is thin and the numbers have to do the persuading.

If you are stepping up from associate to owner, our associate-to-owner transition guide covers the wider financial change, and the segment hub for associate dentists gathers the tools first-time buyers use most. If a second site is already on your mind, expansion is funded differently again: see second-practice and expansion finance. And if you are building a squat from scratch rather than buying, the funding mechanics change, covered in our squat practice funding guide.