Buying Another Practice? Here’s Why an SBA Loan Can Help
Whether you’re a seasoned medical professional looking to grow your existing business or a multi-practice owner aiming to expand your footprint, buying another medical practice can be a smart move. From increasing patient volume to expanding into new specialties or markets, acquisitions offer both strategic and financial advantages. But how do you fund that growth without jeopardizing your cash flow?SBA (Small Business Administration) loans can be a solution.
Why Consider Buying an Existing Practice?
Acquiring a practice—whether it’s a dental clinic, med spa, urgent care center, or specialized practice like cardiology or gastroenterology—offers immediate benefits. These include an established patient base, existing staff and infrastructure, and steady cash flow. Compared to starting from scratch, it’s a faster and less risky path to growth. But even the best acquisition opportunities require capital, and that’s where SBA financing comes in.
The Benefits of SBA Loans for Practice Acquisition
Low Down Payments
SBA 7(a) loans typically require only 10% down, which makes it easier to preserve your working capital for other expenses like staffing, equipment, or upgrades.
Longer Repayment Terms
With repayment periods of up to 10 years for goodwill and up to 25 years for real estate, SBA loans reduce monthly payment burdens, helping you improve your cash flow management.
Flexible Use of Funds
SBA financing isn’t limited to just the purchase price. It can also cover working capital, leasehold improvements, equipment upgrades, and even seller transition support.
Competitive Interest Rates
SBA loan rates, when compared to conventional loans, offer additional savings over the life of the loan.
The Value of Working With Experts
Navigating SBA requirements, paperwork, and timelines can be complex. Partnering with a healthcare financing expert like ProMed Financial ensures your acquisition is set up for success from the start. ProMed can help assess the target practice’s value, structure your deal, and match you with lenders experienced in healthcare transitions.
Buying another practice is a significant but rewarding step in your growth journey. With the flexible terms, lower down payments, and wide-ranging use of funds, SBA loans provide a dependable financing option to support your next acquisition—without sacrificing your day-to-day operations or personal liquidity.