Business acquisition finance · Medical practices
Business acquisition finance for medical practices
Medical practice finance is lending for GP and specialist practices, covering diagnostic equipment, consulting-room fit-outs, practice purchases and the commercial premises a practice trades from.
How business acquisition finance works for medical practices
Buying a practice or a partnership share is assessed mainly on the billings being acquired and the incoming doctor’s registration and earnings history. Lenders on our panel active in medical acquisition will lend against goodwill — unusual in commercial lending generally, and a direct reflection of how recurring medical income is. Expect a detailed look at patient retention, the exiting practitioner’s transition period and any restraint of trade. Vendor finance for part of the price often sits alongside the bank facility.
The cash-flow pattern we plan around
Steady weekly Medicare and patient billings on a short settlement cycle, punctuated by large one-off capital events such as fit-outs, equipment or a practice purchase.
What medical practices typically fund
- Diagnostic and imaging equipment
- Consulting-room fit-out and expansion
- Buying into or acquiring a practice
- Purchasing the practice premises
- Practice management software and IT
Business acquisition finance for medical practices: the numbers
| Typical amounts | $100,000 – $10,000,000 |
|---|---|
| Term | 24–120 months |
| Indicative rates | 7.5% – 16% p.a. |
| Repayments | Monthly |
| Speed | 3–8 weeks |
| Documents medical practices usually need | ABN, AHPRA registration and practice structure details · Two years of practice financials or personal tax returns · Equipment quote, contract of sale or fit-out schedule |
Rates are indicative, change without notice and depend on the lender, product, asset, term and your credit profile at the time of application. They are not an offer of finance. Comparison rates, where shown, are true only for the example given.
Key terms
Medical equipment finance
Medical equipment finance is secured lending for clinical equipment such as ultrasound machines, imaging systems and examination fit-outs, generally offered to registered practitioners on longer terms and lighter documentation than standard commercial equipment finance.
Practice purchase finance
Practice purchase finance is lending used to buy an existing medical practice or a partnership share in one, assessed on the practice’s billings and the incoming practitioner’s registration and earning history.
What is business acquisition finance?
Business acquisition finance is a loan used to fund the purchase of an existing business or a shareholding in one. Lenders assess the target business’s adjusted earnings, the assets included in the sale, the buyer’s deposit and any security offered.
How much deposit do you need to buy a business?
Most lenders expect the buyer to contribute 30–50% of the purchase price in cash or equity. Where the buyer offers property security, the required cash contribution can fall substantially.
What is vendor finance in a business sale?
Vendor finance is where the seller leaves part of the purchase price outstanding, repaid by the buyer over an agreed period. It bridges the gap between the price and what a lender will fund, and signals the vendor’s confidence in the business.
What is normalised EBITDA?
Normalised EBITDA is a business’s earnings before interest, tax, depreciation and amortisation, adjusted to remove owner-specific items such as above-market director wages, personal expenses and one-off costs. Lenders use it to estimate what the business will actually earn under new ownership.
Questions from medical practices
Do doctors get special finance terms?
Yes. Several lenders offer medical professional packages to registered GPs and specialists, with equipment, fit-out, practice purchase and commercial property finance available at sharper rates, higher loan-to-value ratios and lighter documentation because the profession’s income is reliable. AHPRA registration and a practice plan are the key documents.
Can I finance buying into or purchasing a medical practice?
Yes. Practice acquisition finance funds a partner buy-in or the purchase of a whole practice against the practice’s billings and goodwill, often at up to 100 per cent of the price for registered practitioners. Lenders look at the practice’s financials, patient numbers and the doctors staying on.
Can my practice buy its premises through an SMSF?
Yes. A self-managed super fund can buy the commercial premises the practice trades from and lease it back to the practice at market rent, with an SMSF commercial property loan typically funding up to 70 to 80 per cent. The structure suits established practitioners with adequate super balances, and specialist advice is required.
Can consulting room fit-out and equipment be financed together?
Yes. Fit-out works, cabinetry, treatment beds, diagnostic equipment and practice software can be funded under one facility with the builder and suppliers paid as the work progresses, repaid over five to seven years. Medical equipment is often financed separately at a sharper rate and combined in the same application.