Can You Get an SBA 7(a) Loan for a Medical Center?

Small, private medical centers occupy an important niche in the American healthcare market.

If you own (or want to own) an independent outpatient medical center, a small surgery clinic, or an ultrasound/MRI center, an SBA 7(a) loan could be a great way to get the financing you need to start, maintain, and grow your business.

How to Get an SBA 7(a) Loan for a Medical Center or Medical Imaging Center

SBA 7(a) loans aren’t just offered by banks; they’re also offered by credit unions, online and alternative lenders, which gives borrowers a wide variety of choices during the loan application process.

Medical center 7(a) loans can be used for a variety of purposes, such as buying medical equipment, funding the purchase of owner-occupied commercial real estate, and funding a medical center’s working capital reserves.

Medical centers can use SBA 7(a) loans for a variety of purposes.

Purchasing Medical Equipment

Medical equipment can be one of the largest costs for medical centers (especially medical imaging center); for example, some MRI machines can cost up to $3 million, state-of-the-art ultrasound machines can easily cost over $100,000, and new X-ray machines often cost between $125,000 and $235,000.

Building a New Medical Center

SBA 7(a) loans can finance nearly all new construction costs, including furniture, lighting, security systems, and even landscaping.

Refinancing Business Debt

If you own a medical center with SBA-eligible business debt that’s currently being offered to you on unreasonable terms, you may be able to refinance it with an SBA 7(a) loan.

Buying or Expanding a Medical Center

If you want to purchase a medical center, or expand one that you currently own, an SBA 7(a) loan could be a smart way to do so.

Buying Out a Partner

In addition to purchasing a new medical center or expanding a current one, you can use an SBA 7(a) loan to buy out a business partner.

SBA 504 Loans May Be A Better Option for Larger Medical Centers

While the 7(a) loan is a great choice for many medical centers, borrowers primarily looking for commercial real estate financing for their business may find that the SBA 504 loan is a superior fit for their needs. While the SBA 504 program does not allow for working capital or equipment financing, it does offer somewhat lower interest rates than SBA 7(a) loans and a slightly larger maximum loan amount, at $5.5 million.

Case Study: Buying Out a Partner

Roger and his business partner, Lois, had successfully run a medical imaging center together in Tacoma, Washington, for several years. Their center had become an essential part of the community, offering state-of-the-art imaging services such as MRIs, CT scans, and ultrasounds. However, Lois had reached retirement age and expressed a desire to sell her share of the business. Roger, who still had a passion for the healthcare industry, saw this as an opportunity to become the sole owner and continue to grow the business.

To buy out Lois's share, Roger needed to secure financing. After conducting some research, he discovered the SBA 7(a) loan program, which seemed like the perfect solution to help him achieve his goal. Roger decided to apply for a loan of $600,000, which would cover the cost of Lois's share and provide some additional working capital for the business's ongoing operations.

This is a fictional case study provided for illustrative purposes.

Find the Right Business Loan for You

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