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Can You Get an SBA 7(a) Loan for a Medical Center? — SBA7a.Loans

Americans spent over $3 trillion on healthcare in 2016 alone, making it one of the largest industries in the entire country. And, while much of the industry is dominated by large public and private hospitals, as well as doctors’ offices, smaller, private medical centers also occupy an important market niche. And, 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 centers 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:

  • 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.

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