Dental Financing in 2019: Compare Dental Loans and More

According to the Department of Health & Human Services, 108 million Americans don’t have dental insurance. As a result, an increasing number of Americans are forgoing dental care altogether.

Those individuals who do have dental insurance often find it doesn’t offer any real coverage beyond basic exams and cleanings. Many dental plans work more like an annual discount program that pays for certain dental procedures up to an annual maximum. If you exceed your maximum, you’re stuck paying the rest out of pocket.

Paying the full cost for major dental procedures is out of reach for most Americans who end up needing some sort of financing, such as a dental loan, to afford the treatments they need. However, taking out the wrong loan can cause more harm than good, so you’ll want to know what you’re getting yourself into before accepting a dental loan offer.

On this page:

• Using Dental Loans to Finance Dental Work
• Alternative Dental Financing Options
• How to Choose a Dental Financing Plan That is Right for You?

Using Dental Loans to Finance Dental Work

Many lenders have begun offering loans specifically for dental and medical expenses. For example, LendingClub has an entire patient financing division that provides installment loans for dental procedures.

Dental loans through LendingClub are available from $500 to $50,000 with a wide range of flexible repayment options. LendingClub also offers promotional no-interest plans that can be repaid over six, 12, 18, or 24 months. After that, a standard 26.99% APR applies.

The process of applying for a personal loan through LendingClub or similar lender is fairly simple. Since personal loans are unsecured, you’ll be evaluated based on your credit history and income.

Some dental financing companies may require you to visit one of their branches to confirm your information. Once the loan is issued, it can sometimes be refinanced to include additional procedures you may require in the future.

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The Benefits of Using a Dental Loan

There are several benefits to taking out a personal loan for dental work. Personal loans generally have much lower rates than credit cards, so you’ll save yourself a lot of money in interest. You may also be able to secure more flexible repayment terms than you would by financing directly through your dentist.

Personal loans are fairly flexible regarding loan amounts and typically offer fast access to cash, sometimes in as little as one business day. Having equal monthly payments can help borrowers budget over time.

The Risks of Using a Dental Loan

It is possible to find a personal loan with an affordable interest rate, but you’re still taking on financial risk. If you don’t have a good credit score, you may end up with a high interest rate. Since the loan is set for a fixed amount, it’s possible you’ll receive less money than what your total procedure costs, especially if you end up paying origination or application fees

Since it may be possible for you to find alternative forms of financing, make sure to consider all your options before committing taking out a personal loan.

Alternative Dental Financing Options

If taking out a dental loan doesn’t feel like a good fit for you, here are a few alternative dental financing options you can consider:

Line of Credit 

If you’re nervous about taking out a personal loan, you could also apply for a line of credit. A line of credit is similar to a personal loan, but instead of receiving the money in one lump sum, you only withdraw (and pay interest) on what you actually borrow versus the full line of credit for which you’re approved.

A personal line of credit often has lower interest rates than most credit cards and are more flexible than personal loans because they allow you to access cash as you need it, versus in one lump sum.

However, you’ll want to make sure you understand the terms and conditions associated with a line of credit. Depending on your lender, the fees can be quite high. Some lines of credit come with variable interest rates, which could increase the overall costs of repaying the loan over time.

Health Care Credit Cards

Many dental providers now offer credit cards with special payment plans. These are designed specifically for the dental industry and can be used for any procedure.

Some dental offices offer these cards at a limited 0% interest rate, so if you can pay off the loan within 12 months, you won’t be charged any interest.

However, you should only consider this option if you can repay the loan within the specified time frame. If not, you’ll be charged the full interest on the original balance.

In-House Financing 

Some dental offices offer in-house financing through third-party lenders. You’ll fill out a credit application and be matched with a dental financing company.

This may be a good option for patients who have less-than-stellar credit histories. However, be prepared to pay more in interest; APRs on in-house financing can be extremely high.

Installment Payments

For ongoing procedures like braces, dentures, or bridges, many dental offices offer interest-free installment plans to their patients. You’ll pay an initial deposit fee, usually one-third or half of the total amount, and then you’ll pay the rest in monthly installments.

Since this isn’t a loan, you won’t have to fill out an application or undergo a credit check. You can contact your dentist directly to see if they offer monthly installment plans.

How to Choose a Dental Financing Plan That is Right for You?

Dental procedures can be quite expensive, even if you already have dental insurance. Fortunately, there are multiple dental financing options available that can help you afford the cost of much-needed care.

If you have excellent credit and can qualify for a low interest rate, a dental loan might be the right choice for you. You can still qualify for financing if your credit score is on the lower side, albeit with a higher interest rate. Check with your dentist to see if they offer installment plans or other forms of financing.

Anytime you take out a loan, you want to get the best personal loan rates and terms possible. It’s important to consider all your options and make sure you find a payment plan you can afford.