Talk Financing with Confidence: Financing Terms Every Office Should Understand

Term	Definition
APR (Annual Percentage Rate)	The interest rate a patient pays on their loan.
Term	The length of the loan — usually shown in months (e.g., 12, 24, 48 months).
Down Payment	The amount the patient pays upfront before the loan begins.
Monthly Payment	The amount the patient pays each month toward their loan.
MDF (Merchant Discount Fee)	The small percentage fee your office pays to offer financing — similar to a credit card processing fee. This varies by patient profile and loan program.
Pre-Qualification	A quick way to see what financing options a patient may be eligible for — without affecting their credit score.
Soft Credit Check	A type of credit check that does not impact a patient’s credit score. Often used for pre-qualification.
Hard Credit Check	A credit check that does impact a patient’s credit score. Typically used by traditional lenders (unlike HFD) when a loan is finalized.
Non-Recourse	A financing option where HFD takes the risk, not your office, if the patient doesn’t repay.
Payment Frequency	How often the patient makes their payments usually monthly, but can also be, weekly, bi-weekly, or semi-monthly.
Funded Loan Amount	The amount your office receives from HFD after a loan is approved and any down payment is made.
Payment Plan	The patient’s full agreement with HFD to pay for their treatment over time.

Talking about financing with patients doesn’t need to feel intimidating. This guide breaks down common terms you and your team may hear when discussing payment plans with your patients.