Practice Loans and Financing

Ovesture has been arranging business funding since 2004. For practices in New York and New Jersey we prepare one financial file, take it to the lenders suited to the project and lay their offers side by side, so you compare SBA, conventional and non-bank structures on the same numbers. Approval and pricing always rest with the lender.

Practice financing by specialty

Each profession earns and holds cash differently, and a lender should read it that way. Start with the page for your specialty:

• Dental practices

  dental practice loans for buying, starting, expanding or equipping a dental office.

• Medical practices

  medical practice loans for physician groups adding providers, locations, equipment or an acquisition.

• Aesthetic practices

  aesthetic practice financing for med spa and aesthetic practice owners adding devices, treatment rooms or locations, not patient payment plans.

• Veterinary practices

  veterinary practice loans for clinic acquisitions, equipment and expansion built around client-pay cash flow.

• Optometry practices

  optometry practice financing for clinical equipment, optical expansion and practice purchases.

• Pharmacies

  pharmacy loans for pharmacy acquisitions, additional locations and inventory with reimbursement timing in view.

• Law firms

  SBA loans for law firms and conventional options for expansion, office build-outs, lateral hires and partner transitions.

• Accounting firms

  accounting firm loans for book acquisitions, succession and partner transitions in CPA firms.

• Home health agencies

  home health care business funding for new service areas, caregiver payroll and agency acquisitions.

Is practice financing different from a standard small business loan?

Yes. A standard small business loan is underwritten mainly on the business's revenue, credit and collateral. Practice lenders also weigh the owner's professional license, insurance-driven or client-pay collections and the value of the patient or client base, and an acquisition is judged on the target practice's own cash flow. The documents, structures and lenders differ as a result.

The difference shows in the details. A dental or medical lender understands that reimbursement lags the work by weeks; a law firm lender understands trust-account rules and contingency fees; an accounting firm lender values the recurring client book. A lender that treats every practice like a generic small business tends to misread the ones that matter to you. For businesses outside the professions, see our business financing services.

What practice loans pay for

• Buying a practice. A full purchase, or buying into a partnership. See the acquisition section below.
• Partner buy-ins and buyouts. An associate becoming an owner, or remaining partners buying out a retiring one; see partner buy-in and buyout financing.
• Expansion and second locations. Added treatment rooms, a larger office or a new site, with the build-out budget kept separate from the working capital the ramp-up needs.
• Opening a new practice. Without an operating history, lenders lean on the owner's credentials, business plan and equity contribution.
• Equipment and real estate. Imaging, chairs and technology, or the building the practice occupies, where SBA 504 loans are designed to help.
• Working capital. Staffing, supplies and the gap between doing the work and collecting for it.

Practice acquisition financing

Practice acquisition financing funds the purchase of an existing practice or an ownership interest in one. What separates it from a personal loan is that the practice largely pays for itself: the lender looks at the target's collections, patient or client base and history of turning production into deposits, then asks whether that cash flow can service the new loan once the seller has left. Most purchases combine two or three of the structures below.

SBA 7(a) loans

SBA 7(a) loans are the program used for changes of ownership. A single loan can combine the purchase price, including goodwill, with eligible equipment and working capital. The trade-off is a longer, more document-heavy process and program rules on equity and seller financing.

Conventional bank loans

A conventional term loan from a bank can be simpler and faster when the buyer's credit and the practice's financials are strong. Banks often ask for more buyer equity than an SBA structure, and the loan may not stretch to transition costs.

Seller notes

A seller note is part of the price the seller agrees to receive over time. It can close the gap between the main loan and the price and keeps the seller invested in the transition. It is negotiated with the seller, not offered by Ovesture, and must fit the senior lender's requirements.

For dental buyers, our guide on how to buy a dental practice walks through the steps either side of the funding, and our even-handed comparison of SBA versus conventional loans for a practice sets the two side by side.

Discuss a practice acquisition

Practice lender types compared

Bank, SBA and non-bank lenders can all suit established practices. Compare them against the same project budget: the lowest rate alone does not tell you how much liquidity a structure leaves the practice.

What do practice lenders look at?

• Your personal credit and professional license
• Years in practice and documented profitability
• Collections, payer mix and debt-service coverage
• Existing debt, liens and merchant cash advances
• Equity or down payment and the collateral available
• For an acquisition, the target's valuation and records

How practice financing works with Ovesture

1. Intro call. You tell us what you want to fund and share the project budget or the purchase terms.
2. Document checklist. We send the list for your project; the practice purchase document checklist shows the full version.
3. Lender matching. We take one complete file to the bank, SBA and non-bank lenders suited to the project.
4. Term sheets and closing. You compare offers side by side, choose one and we support the file through to funding.

Timing depends on the lender, the program and how complete the file is, which is why it pays to start while the plan is still taking shape. How we are paid is set out on how we get paid.

Practice financing in New York and New Jersey

New York and New Jersey practices carry high rent and build-out costs, dense competition and, for healthcare, payer mixes that lean on PPO and managed plans. SBA programs are federal, so eligibility does not change at the state line; the local cost base does, which is why a New York or New Jersey purchase or build-out often needs a larger facility than the same deal elsewhere. See New York business funding and New Jersey business funding.

Get my practice financing options