Psychiatric practices took 326 SBA 7(a) loans between October 2023 and June 2026, about $105 million from 90 lenders. The median loan, $150,000, sits almost exactly on the national $150,300, at a median rate of 10.37% against 10.25%. Start-ups were 12.3% of loans and purchases of existing practices only 4.3%. Lenders underwrite the prescribers: how many there are, whether they own the practice or work for it, the split between insurance and self-pay, and how much of the revenue rests on one psychiatrist's schedule.
| Measure | Offices of Physicians, Mental Health Specialists | All industries |
|---|---|---|
| SBA 7(a) loans approved | 326 | 162,355 |
| Median loan | $150,000 | $150,300 |
| Middle half of loans | $50,000 – $350,000 | $50,000 – $500,000 |
| Loans of $1 million or more | 6.4% | 12.9% |
| Median rate at approval | 10.37% | 10.25% |
| Middle half of rates | 9.5% – 11.5% | 9.3% – 11.25% |
| Acquisitions (change of ownership) | 14 (4.3%) | 16,849 (10.4%) |
| Median acquisition loan | $335,500 | $693,000 |
| Lenders that made these loans | 90 | 1,648 |
| SBA 504 loans (real estate, equipment) | 59 | 16,714 |
Approvals FY2024 – FY2026 to date (1 Oct 2023 – 30 Jun 2026), cancelled loans excluded. Source: SBA 7(a) and 504 FOIA loan records, as of June 30, 2026.
- SBA 7(a) loans approved
- 326 (Oct 2023 – Jun 2026)
- Lenders that approved one
- 90
- Median loan
- $150,000 (national $150,300)
- Median rate at approval
- 10.37% (national 10.25%)
- Start-ups
- 12.3% of loans
- Practice purchases
- 14 loans (4.3%), median $335,500
A national-median loan in a physician specialty
NAICS 621112 is the offices of physicians who specialize in mental health: psychiatrists, child and adolescent psychiatrists, addiction psychiatrists and the practices they own. Therapists and counselors without a medical degree sit in a separate code, covered on SBA loans for therapy and counseling practices, and other physician specialties on SBA loans for physician practices.
From 1 October 2023 to 30 June 2026 the code took 326 SBA 7(a) loans worth $104,784,000 from 90 lenders. The loans are modest for a physician specialty: a median of $150,000, a middle half from $50,000 to $350,000, and a top tenth starting at $619,250. Psychiatry needs little equipment and often little space, so most loans fund working capital, a new office, hiring, or a partner buy-in rather than machines.
| Figure | Psychiatric practices | National | Reading |
|---|---|---|---|
| Median loan | $150,000 | $150,300 | Working capital and fit-out, not equipment |
| Middle half | $50,000 to $350,000 | Most requests sit in the SBA's smaller-loan rate bands | |
| Loans of $1 million or more | 21 (6.4%) | Groups, interventional clinics, buildings | |
| Median rate | 10.37% (middle half 9.5% to 11.5%) | 10.25% | Close to national despite the smaller loans |
| Fixed-rate share | 15.6% | Mostly variable, so payments move with the base rate | |
| SBA Express | 36.2% of loans | Smaller requests on the lender's own process, 50% guaranty | |
| Start-ups | 12.3% of loans | Psychiatrists leaving employment to open their own | |
| Acquisitions | 14 loans (4.3%), median $335,500 at 9.75% | 10.4% of loans | Practices change hands, but rarely through SBA |
| Median jobs supported | 5 | A prescriber or two, therapists, front desk and billing |
Three practice models, three different credits
Underwriters do not see "a psychiatry practice". They see one of three businesses, and each carries its risk in a different place.
| Model | Where revenue comes from | What the lender worries about |
|---|---|---|
| Solo psychiatrist, medication management | The psychiatrist's own visits, often partly self-pay | Everything rests on one person's health, license and schedule |
| Group practice: psychiatrists, psychiatric nurse practitioners, therapists | Many clinicians' visits, mostly insurance | Clinician retention, credentialing, collections, supervision costs |
| Interventional clinic (TMS, esketamine, ketamine) | Procedure series, prior-authorized or self-pay | Payer approval rules, equipment cost, referral flow, regulatory change |
The solo practice is the simplest credit and the most concentrated. The lender will want key-person life insurance and sometimes disability cover assigned to it, because there is no business without the psychiatrist. The group practice spreads that risk but adds an employer's problems: whether clinicians are employees or contractors, whether their non-competes hold, and how quickly a departing prescriber's patients follow them out. The interventional clinic looks most like a medical equipment borrower, with a device to finance and a payer approval process that decides whether the device is busy.
Self-pay, in-network, and the collections test
Many psychiatrists do not take insurance, or take only some. For a lender this cuts both ways. Self-pay revenue is collected at the visit, so there are no claim denials or aging receivables, and the bank statements tell the story cleanly. But it depends on patients who can afford to pay, and on a reputation that is personal to the psychiatrist. Insurance revenue is more durable and more transferable, but slower: the practice must be credentialed with each payer before it can bill, and collections trail visits.
Either way, lenders underwrite collections, not charges. An insurance-based practice should expect to show collections by payer and an aging of what is owed. A self-pay practice should expect the lender to tie deposits to reported revenue month by month.
SBA requires debt service coverage of at least 1.15x, and 1.0x globally once the owners are included. The owner's pay matters here. If the psychiatrist-owner takes a modest salary and a large distribution, the lender will look at whether the practice can cover the loan and still pay the owner enough to live on. In a practice showing cash flow of 300 before owner pay, with an owner who needs 200 to live and loan payments of 80, the business covers the loan easily on its own and has far less room once the owner's living costs come out. That second test is usually the one that decides the file. See global cash flow.
A practice with strong self-pay revenue should bring twelve months of bank statements even though the SBA checklist marks them optional.
Telehealth and licensing
Psychiatry moved to telehealth further than almost any other specialty, and many practices now see a large share of patients by video. That changes what a lender is financing. A telehealth practice has little collateral, no building and few fixed costs, and can grow quickly by adding prescribers licensed in more states.
Lenders ask three questions of it. Is every prescriber licensed in each state where their patients sit? How much revenue depends on prescribing controlled substances by telehealth, where federal permission has rested on a series of temporary extensions rather than a settled rule? And do the payers the practice relies on keep paying for video visits on the same terms? None of these stops a loan. Each is a risk the underwriting memo has to name and size.
Buying a psychiatric practice
Only 14 loans financed a change of ownership, at a median of $335,500 and a median rate of 9.75%, below the industry's overall median. Patients follow psychiatrists, often for years, which makes a clean sale harder than in most practices. The purchases that work usually involve a group with several prescribers, or a buyer who has already worked in the practice and whom patients know.
SBA's acquisition rules apply in full. The buyer injects at least 10% of total project costs. A seller note counts toward half of that only on full standby for the life of the loan. SBA prohibits an earnout to the seller, so any price contingent on patients staying has to be settled at closing. The seller may consult for up to 12 months, extended to 24 months under SOP 50 10 8.1 from 1 October 2026, but cannot stay on as an owner or employee. For a retiring psychiatrist handing over a caseload, the longer consulting window is a real change. From the same date, every change of ownership needs financial due diligence and must show 1.25x coverage on historical results.
Buying into a group rather than buying it outright follows different rules; see partial change of ownership under SBA. For the wider process, see financing a medical practice acquisition.
The office, the device, and the 504 figure
Lenders also approved 59 SBA 504 loans in this industry at a median of $414,000, a large count against 326 7(a) loans. Psychiatrists who buy their office, often a medical condominium, frequently use 504: typically 50% from a bank, 40% from a certified development company and 10% from the borrower, with the practice occupying at least 51% of an existing building. The real estate then carries a term of up to 25 years instead of the 10 that working capital gets. The trade-offs are set out in SBA 7(a) vs 504.
Treatment devices are a separate decision. A TMS system can go into a 7(a) loan at up to 10 years, or be financed on its own by an equipment lender; Transparent's book holds 244 lenders that write equipment. Which is cheaper depends on the device's price, the practice's other borrowing and how much the lender will advance against the device itself.
Preparing a psychiatric practice's SBA file
- Business tax returns for 2–3 years and personal returns for each 20%+ owner, each of whom will personally guarantee the loan.
- A P&L, a year-to-date P&L through last month-end and a balance sheet.
- Collections by payer and a receivables aging, or for self-pay practices, bank statements tied to revenue.
- A roster of prescribers and therapists: licenses, states, employment or contractor status, and start dates.
- A debt schedule with copies of notes being refinanced, and a personal financial statement for each 20%+ owner.
- For a start-up, a business plan with a credentialing timeline and the psychiatrist's resume, which supports the management section of Form 1919.
Transparent's book includes 278 lenders that write SBA 7(a) and 504, and they differ in how they read a practice that rests on one or two prescribers. Once the documents are in, Transparent builds the full lender package, including the financing model and underwriting memo, in a day.
Common questions
- Can a psychiatrist leaving employment get an SBA loan to open a practice?
- Yes; 12.3% of the loans in this industry went to start-ups. The lender underwrites the psychiatrist's training, record and plan, requires an equity injection of at least 10% of project costs and a personal guarantee, and sizes working capital to carry the practice until payers are credentialed and collections catch up.
- Do lenders count self-pay revenue?
- Yes, when bank deposits support it. Lenders will tie monthly deposits to reported revenue and look at how dependent it is on one psychiatrist's reputation.
- Can I finance a TMS device with an SBA loan?
- Yes. Equipment can be financed in a 7(a) loan for up to 10 years, or longer if its useful life supports it. An equipment loan against the device alone is the main alternative.
- Does a telehealth-only practice qualify?
- It can. Expect questions on licensing in each patient's state, on dependence on telehealth prescribing of controlled substances, and on payer terms for video visits, and expect collateral to be thin.
- Can the selling psychiatrist stay on after I buy the practice?
- Not as an owner or employee in a complete change of ownership. The seller may consult for up to 12 months, or up to 24 months under SOP 50 10 8.1 from 1 October 2026.