SBA loans for services for the elderly and persons with disabilities

What SBA lenders approved in this industry

Services for the elderly and persons with disabilities (NAICS 624120) covers non-medical home care, companion and personal care services, adult day programs and similar support. Medical home health, with nurses and therapists billing Medicare, is a different industry: see home health care services. The non-medical side took 514 SBA 7(a) loans from FY2024 through June 2026, worth $256,979,300, from 120 lenders.

A median of 8 jobs per loan is high for loans of this size, and it describes the business: a home care agency is an office, a scheduler and a roster of caregivers. There is little to pledge besides receivables, so lenders are lending on the agency's cash flow and on the personal guarantees of every owner of 20% or more.

Why acquisitions do not price lower here

In many industries, SBA acquisition loans price below the industry median, largely because they are larger and larger loans sit in SBA's tighter rate tiers. Here they barely do: a median of 10.24% on acquisitions against 10.25% for the industry. The data do not say why, but the collateral is the likeliest reason: a home care purchase is almost entirely goodwill, a client census, a caregiver roster, referral relationships and a license, and none of it can be sold if the agency fails.

With 16.9% of loans financing purchases, a buyer here is in a well-worn lane: lenders see many agency files and know where they break. SBA's acquisition rules apply in full: the buyer injects at least 10% of total project costs, and a seller note counts toward half of it only on full standby for the life of the SBA loan. Where the amount financed, less appraised real estate and equipment, exceeds $250,000, as it will in most agency purchases, SBA requires an independent business valuation, and the loan cannot exceed it. See SBA's business valuation requirement and financing goodwill.

From 1 October 2026 every change of ownership needs financial due diligence and must show 1.25x debt service coverage on historical results; an acquisition of $3 million or more excluding real estate also needs a quality of earnings report. Change-of-ownership loans then amortize over no more than 10 years except the real estate share.

Licenses and provider enrollment: what survives a sale

This is the question that most often delays a home care purchase. Many states license home care agencies, and the license is usually issued to a specific entity. Agencies that bill state Medicaid waiver programs, the VA or managed care plans hold provider enrollments and contracts in that entity's name. In an asset purchase, the buyer's new company may need its own license and enrollment, and revenue from those payers can pause until they are issued. In a stock purchase the licenses usually stay put, but the state and payers may still require a change-of-ownership notice or approval.

• Ask early which licenses, enrollments and contracts the agency holds, in whose name, and what each requires on a change of ownership.
• Structure around them. Whether the deal is an asset or stock purchase often turns on this more than on tax. See asset vs stock purchase financing and change-of-control consents.
• Franchise transfers. For the third of borrowers who are franchisees, the franchisor must approve the buyer and the transfer. See franchise resale financing.

A lender will not fund on revenue that depends on a license or enrollment the buyer does not yet hold. Map every payer to its license before signing the letter of intent.

What lenders look at in a home care agency

SBA requires debt service coverage of at least 1.15x, and 1.0x globally once the owners' personal debts are included. In home care the margin between the billed hourly rate and the caregiver's loaded wage is the whole business, so small changes move coverage. An agency with cash flow of 300 against proposed payments of 230 clears 1.25x; a round of caregiver wage increases it cannot pass on to payers may not leave it there. See debt service coverage ratio.

• Payer mix. Private pay, long-term care insurance, VA and Medicaid waiver programs each pay at different rates and speeds. Heavy reliance on one government program is a rate-setting risk lenders weigh.
• Hours and census. Billed hours per week, active clients, and how long clients stay, month by month, are the operating data lenders read.
• Caregivers. Turnover, recruiting cost, overtime and whether caregivers are properly treated as employees. A registry model that treats them as contractors raises questions a lender will ask.
• Owner dependence. If referrals come through the owner's relationships with hospitals, discharge planners and care managers, the lender wants a plan for them after the owner leaves. The seller may consult for up to 12 months, or up to 24 months under SOP 50 10 8.1 from 1 October 2026.
• Receivables. Medicaid and VA pay on their own schedules. An aging by payer shows how much working capital the agency needs. See lines of credit for home care agencies.

Start-ups, franchises and adult day real estate

Start-ups were 29.6% of loans and franchises 33.7%, and many are likely both: a new territory of a home care brand. A start-up needs an equity injection of at least 10% of total project costs and a plan that shows how long it takes to reach enough billed hours to cover payroll and payments. Lenders look for owners with care management, nursing, or healthcare operations backgrounds, and they read the franchisor's record alongside the owner's.

Adult day programs, unlike home care, need a building: licensed space, accessible entrances, a kitchen, sometimes vehicles. The industry's 24 SBA 504 loans, at a median of $693,000, likely include that kind of property. 504 finances owner-occupied real estate, typically 50% from a bank, 40% from the CDC and 10% from the borrower, and 15% for a new business or special-purpose property. See SBA 7(a) vs 504 and, for residential care, assisted living facilities.

Preparing a home care agency's file

SBA's standard list applies: business tax returns for 2–3 years, a P&L and balance sheet with a year-to-date P&L, a debt schedule with copies of notes being refinanced, and personal tax returns and a personal financial statement for each owner of 20% or more. An owner's resume supports SBA Form 1919. An acquisition adds the target's latest full year of figures, never an older year, and the letter of intent.

For a home care agency, add revenue and hours by payer by month, an AR aging by payer, the client census with length of service, caregiver headcount and turnover, copies of the state license and every payer enrollment and contract, and the franchise agreement if there is one. Agencies that have used merchant cash advances to meet payroll should list them; SBA will not refinance an active advance. See refinancing cash advances for healthcare providers.

Transparent builds those into a financing model, lender presentation, blind teaser and underwriting memo in a day, and sends the file to the 278 lenders in its book that write SBA 7(a) and 504. On SBA loans the lender pays Transparent, not the borrower. See financing a home health agency acquisition for the medical side of the same market.