On this page
What a personal guarantee actually is
Your practice is a legal entity, and the loan is made to that entity. A personal guarantee is a separate promise, signed by you as an individual, that if the practice stops paying, you will. It is not collateral: signing a guarantee does not put a lien on your home, your car, or your personal accounts. The lien is on the equipment. And it is not a down payment or a deposit; nothing changes hands when you sign it. In the overwhelming majority of files the practice pays as agreed and the guarantee never does anything at all.
What it does mean, stated plainly: if the practice defaults and the recovered equipment does not cover the balance, you can be pursued personally for the shortfall. That is the actual exposure, and it is worth understanding before you sign rather than after.
Why it is asked for
Dental equipment is good collateral and still imperfect collateral. A chair or a scanner recovered from a closed practice sells at a fraction of what you paid, and the cost of getting it out of the operatory eats into that.
The guarantee covers the gap between what the equipment returns and what is owed.
There is a second reason, more about behavior than security. A practice owner who has signed personally treats the payment differently from one who has not, which is part of why guaranteed paper is cheaper than corporate-only paper. None of this is dentistry-specific. Ask a restaurant owner, a contractor, or a trucking company about their last equipment purchase and you will hear the same answer.
Who has to sign
General practice in equipment finance. Requirements vary by program and by file; subject to credit approval.
On spouses: a spouse generally cannot be required to sign simply because you are married, if you qualify on your own. That is federal law under the Equal Credit Opportunity Act and Regulation B. A spouse who is an owner of the practice may be asked to guarantee in that capacity. If your spouse has no ownership interest and a signature is requested anyway, ask why.
Corporate-only: what it actually takes
Corporate-only is real, and it is narrow. It generally takes 3+ years in business, often longer for a one- or two-owner practice, plus previous comparable business borrowing: prior facilities at or near the size being requested, paid as agreed. In dentistry that profile usually means a DSO, a multi-location group, or an established practice owned by several dentists.
The requirement people underestimate is the second one. Time in business is easy to evidence.
A borrowing track record is not something you can assemble in a quarter.
A twelve-year practice that has never financed anything larger than a $30,000 chair is long-established and still does not have the history to support a $700,000 corporate-only request.
Where this fits: DSOs, multi-location, and group practices
- DSOs and management organizations. The entity is capitalized to carry debt on its own, and equipment purchases are frequent and sizable enough to have built exactly the borrowing record underwriting wants. Getting individual dentists off guarantees is often a governance requirement.
- Multi-location practices. Several years of consolidated performance is a stronger story than one operatory’s collections, and the entity has usually financed buildouts before.
- Group practices owned by several dentists. The obstacle here is rarely credit. A guarantee means chasing four or five signatures, each with their own credit profile and their own opinion about signing. A five-owner group where one partner is mid-divorce, or carrying a recent credit event, or simply declines to sign, can stall a straightforward purchase for weeks. If the entity qualifies, the problem disappears.
What it costs to skip the guarantee
Corporate-only is not free. Removing the personal recourse removes a real protection, and pricing reflects that. Expect a somewhat higher rate, a harder underwrite (full financial statements, interim figures, a debt schedule, a closer look at the balance sheet), and a slower process, because application-only speed and corporate-only underwriting do not go together. For a solo owner, the trade is usually not worth it even when it is available. For a DSO with a board that does not want individual dentists on the paper, it plainly is.
If you have to sign, sign it well
- Is it joint and several, or several? Joint and several means any one guarantor can be pursued for the entire balance. It is the standard, and partners should understand it going in.
- Is there a cap? Some guarantees are limited to a stated dollar amount or a percentage, worth asking about in a multi-owner group.
- Is there a release on exit? If a partner sells out in year three, does the guarantee follow them? Negotiate this at signing, not at exit.
- Does it cover this transaction only? A continuing guarantee can extend to future obligations. Know which one you are signing.
- How does it report? Whether a guaranteed obligation shows on your personal credit varies. Ask directly, especially if you are also planning a mortgage.
Building toward corporate-only
Borrow, and repay as agreed, under the entity’s name; the track record only accrues if the debt is in the practice entity. Keep the entity continuous, because restructuring into a new EIN resets the clock on the years in business. Maintain real financial statements, since corporate-only is underwritten on the entity’s numbers. And step the size up: a history of $50,000 facilities supports a $50,000-ish request, and building toward a seven-figure corporate-only line means having carried meaningful debt before.
Five West programs at a glance
Most dental equipment financing is written with a personal guarantee from owners at 20% and above. We also write corporate-only for entities that carry the history for it, meaning 3+ years in business (often longer for a one- or two-owner practice) plus comparable prior borrowing. That is where DSOs and multi-location groups usually land.
- Rates
- Priced to your credit profile, term, and equipment; competitive with a bank on rate, not on speed
- Terms
- 24 to 84 months, with 10 years on SBA loans
- Amounts
- $15,000 to $5 million+
- Application only
- Up to $500,000 with no tax returns or financial statements
- Credit
- Established businesses from 600+, startups from 700+
- Equipment
- New, used, refurbished, dealer, and private-party purchases
- Speed
- Same-day options on qualified files, with approvals in as little as 30 minutes
- Coverage
- Nationwide and U.S. territories
Tell us how the practice is owned and we will tell you what the file will require. Free consultation, no obligation.
Free consultation, no obligation. All financing is subject to credit approval and underwriting; rates and terms depend on the complete business and credit profile.
The bottom line
Expect to sign one. A personal guarantee on dental equipment financing is routine, required from owners at 20% and above, and not evidence that anyone is uncomfortable with you. The exposure is real but narrow, and in a practice that pays as agreed it never comes into play. If you are a DSO, a multi-location group, or a practice owned by several dentists, corporate-only is worth asking about. Have two things ready: 3+ years under the entity, and evidence that the entity has borrowed at comparable size before. Send us the structure and the quote, and we will tell you which side of that line you fall on before you fill anything out.
Personal guarantee questions dentists ask
Do you need a personal guarantee for dental equipment financing?
In most cases yes. A personal guarantee is standard on dental equipment financing and is normally required from every owner holding 20% or more of the practice. It is not a sign of a weak file, because nearly all small-business equipment credit is written this way. Corporate-only approval with no personal guarantee exists but generally requires 3+ years in business, often longer for a one- or two-owner practice, plus a record of previous comparable business borrowing.
What does a personal guarantee actually do?
It makes you personally answerable for the debt if the practice stops paying. The loan is made to your entity. The guarantee is a separate promise you sign as an individual. If the practice defaults and the recovered equipment does not cover the balance, you can be pursued for the shortfall.
Does a personal guarantee put a lien on my house?
No. A personal guarantee is an unsecured promise, not collateral. The lien is on the financed equipment. Signing a guarantee does not place a lien on your home, your vehicle, or your personal accounts. If a practice defaults and a guarantee is enforced, collection proceeds like any other unsecured creditor.
Can I get dental equipment financing without a personal guarantee?
Yes, through corporate-only approval, but it is a narrow program. Five West generally looks for 3+ years in business under the same entity (often longer for a one- or two-owner practice) plus previous comparable business borrowing paid as agreed, meaning prior facilities at or near the size being requested. It is underwritten on full financials rather than application-only, and it typically prices higher than the same deal with guarantees attached.
Who is a good fit for corporate-only dental equipment financing?
DSOs, multi-location practices, and group practices owned by multiple dentists. Those entities are usually capitalized to carry debt on their own and have financed enough previously to have built the borrowing record underwriting looks for. For group practices, corporate-only also removes the practical problem of collecting guarantees from four or five owners.
Which owners have to sign a personal guarantee?
Typically every owner at 20% or more. A minority partner below that threshold usually is not asked to sign. In a two-partner 50/50 practice both partners sign; in a five-owner group all owners above the threshold sign, which is one of the reasons larger groups pursue corporate-only.
Does my spouse have to sign a personal guarantee?
Generally not, if you qualify on your own. Under the Equal Credit Opportunity Act and Regulation B, a spouse’s signature cannot be required solely because you are married. A spouse who is an owner of the practice may be asked to guarantee in that capacity. If your spouse has no ownership interest and a signature is requested anyway, ask why.
Is a personal guarantee joint and several?
Usually yes. Joint and several means any one guarantor may be pursued for the full balance rather than a proportional share, which partners should understand going in. Some guarantees can be capped at a stated amount or include a release on ownership exit, and both are worth raising at signing rather than later.
Wondering whether your entity qualifies for corporate-only?
Send us the ownership structure and a recent set of financials and we will tell you before you fill anything out. Or run the numbers yourself first in the Quote Builder. No credit pull, no obligation.
Related dental financing guides
More on financing equipment for a dental practice.
On the siteDental financingEquipment financeQualification guidelines
This article is general information about commercial equipment financing and is not a commitment to finance. All financing is subject to credit approval and underwriting. Rates, terms, and approval depend on the complete business and credit profile. Figures shown are illustrative market ranges gathered from published sources as of August 2026 and are not an offer. Five West Financial is not a tax advisor or an accounting firm; confirm any tax treatment with your CPA before relying on it.