Financial Crunch Effecting Loan Rates?
What impact does the current financial crunch have on your loan rates? Vet loans has the answer.
National Report — The nation’s worst economic downturn in decades has triggered a credit crisis for many types of lending, but so far it’s had little effect on the buying and selling of veterinary practices — except for some that already were proving difficult to sell.
That’s the consensus of several leading practice brokers and lenders contacted by DVM Newsmagazine.
“I can’t say what might happen over the next few months, but so far activity for us has stayed about the same. The only real challenge I have is finding good, saleable practices that are worth buying,” says Dick Goebel, DVM, president of practice brokerage Simmons & Associates’ Great Lakes division in Monticello, Ind.
Up to a third of practices on the market for some time may be virtually unsellable, Goebel says, depending on their location, type of practice and profit history.
But, in general, “When I asked the three lenders we use most often whether anything that’s happened in the financial markets lately has changed business patterns for them, two said absolutely not – that nothing has changed – and the other simply dropped their fixed (loan) rate guaranty period from five years to three but otherwise terms are the same and activity is steady,” Goebel says.
Two field sales managers for a practice-lending arm of California-based Wells Fargo Bank, and a regional sales manager for Banc of America Practice Solutions, a division of Bank of America that makes loans for veterinary-practice acquisitions and expansions, had similar comments.
“Our business hasn’t slowed at all. We’ve had more in the last two or three months than we had in the early months of this year,” says Ian Widensky, Northeast regional sales manager for Banc of America Practice Solutions, who is based in New York City. We’ve even financed seven start-up practices in the region from Maine to Virginia.”
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