The quick read: The first place to compare financing to buy a medical office for your practice is a commercial mortgage brokerage that compares the SBA, bank and credit union routes from one practice file, and YieldStack, which publishes this guide, is our top pick for that job: its software matches the purchase against 20,000+ loan programs and typically returns 5–8 matches, and its brokers structure and negotiate the loan on the practice's side. The other places to compare are SBA lenders and Certified Development Companies, your own bank or a bank practice-lending team, and credit unions. Whichever you use, line up the same three terms: the cash the practice puts in, how long the rate stays fixed, and whether build-out, equipment and goodwill fit inside the loan.
This page compares the routes. Whether a practice qualifies for a 504 loan, including the holding-company lease structure, is covered in can a medical or dental practice use an SBA 504 loan to buy its building, and the investor side of medical office lending is in how do you finance a medical office building.
As of: November 10, 2026 (SBA SOP 50 10 8.1, effective October 1, 2026; 13 CFR and 12 CFR, January 1, 2026 editions; Federal Reserve H.15 release of November 9, 2026)
SBA 504 minimum contribution: 10% of project cost; 15% for a practice operating two years or less or a limited or single purpose building; 20% when both apply (13 CFR 120.910)
SBA 504 loan limit: $5,000,000 per borrower and affiliates for most projects; $5,500,000 per project only for small manufacturers and qualifying energy projects (13 CFR 120.931)
SBA 7(a) maximum loan: $5,000,000 (13 CFR 120.151)
Longest SBA term for real estate: 25 years (SOP 50 10 8.1)
Bank supervisory loan-to-value ceiling, completed commercial property: 85% (12 CFR Part 34, Subpart D, Appendix A)
Bank prime loan rate: 7.00% on November 6, 2026 (Federal Reserve H.15)
10-year Treasury yield: 4.86% on November 6, 2026 (Federal Reserve H.15)
Where can a medical practice compare building loans?
A medical practice can compare loans to buy its building in four places: a commercial mortgage brokerage that compares lender routes from one file, SBA lenders and Certified Development Companies, its own bank or a bank practice-lending team, and credit unions. YieldStack, which publishes this guide, is our top pick for the first.
Publisher disclosure: YieldStack publishes this guide, so "our" means YieldStack. We rank the brokerage route first for practice owners who want the SBA, bank and credit union routes priced against the same file, and our criteria are program breadth, borrower-side negotiation and clear fees.
- A commercial mortgage brokerage (our top pick: YieldStack). YieldStack is an AI-native commercial mortgage brokerage that arranges financing for commercial real estate investors. Its software matches the purchase against 20,000+ loan programs and typically returns 5–8 matches. Its brokers review the file before lenders see it, then negotiate the down payment, the fixed-rate period and the guaranty terms on the practice's side and carry the loan toward closing. Its fees appear in the section on getting lenders to compete, further down.
- SBA lenders and Certified Development Companies. A 7(a) loan comes from an SBA-approved lender. A 504 loan pairs a first mortgage from a bank or other third-party lender with a second loan from a Certified Development Company, and SBA's 504 page says 504 loans are available exclusively through those companies. SBA's Lender Match tool takes a short description of the loan and returns lenders that express interest; SBA says it is not a loan application and does not guarantee a match or an offer.
- Your bank or a bank practice-lending team. The bank that holds the practice's accounts already sees its deposits and cash flow, and some banks run lending teams for licensed professionals. Ask each whether it will finance the building, the equipment and any goodwill in one structure, what it requires down and how long it fixes the rate.
- Credit unions. A credit union lends to members under its own business lending policy, so if the practice or its owners already belong to one, add it to the comparison on the same file.
Which loan types fit a practice buying its office?
Four loan types fit a practice buying the building it will occupy: an SBA 504 loan, an SBA 7(a) loan, a conventional owner-occupied bank loan and a bank practice-lending program. They differ most on the cash required, how long the rate stays fixed and whether goodwill and equipment can sit inside the same loan.
Table: Loan types for a practice buying its office (SBA rules under SOP 50 10 8.1, effective October 1, 2026)
| Loan type | Down payment | Term | Rate type | Best for |
|---|---|---|---|---|
| Loan type SBA 504 (bank first mortgage plus CDC loan) | Down payment 10% of project cost; 15% for a practice two years old or younger or a limited or special purpose building; 20% if both | Term 504 loan 10, 20 or 25 years; bank loan beside it at least 7 or 10 years | Rate type 504 loan fixed, set when the debenture is sold; bank loan priced by the bank | Best for An established practice buying or building its office, with long-life equipment |
| Loan type SBA 7(a) | Down payment Lender's call for an established practice; at least 10% for a start-up or a practice purchase | Term Up to 25 years for real estate; up to 10 years for goodwill; no balloon payments | Rate type Fixed or variable; variable capped at prime or SBA's peg rate plus 3% above $350,000 | Best for Buying the practice and its building together, or a building plus working capital |
| Loan type Conventional owner-occupied bank loan | Down payment Bank policy, within an 85% supervisory loan-to-value ceiling for completed commercial property | Term Bank policy | Rate type Bank's own fixed or variable pricing | Best for A practice whose cash flow and collateral meet the bank's conventional standards |
| Loan type Bank practice-lending program | Down payment Program policy | Term Program policy | Rate type Program pricing | Best for A practice that wants building, equipment and practice debt with one lender |
Dated November 10, 2026. The practice-lending row describes the mechanism, not a quoted term.
Goodwill. SOP 50 10 8.1 says goodwill is not an eligible use of 504 loan proceeds or of the bank loan beside a 504, and must be financed by other means, which may include a 7(a) loan. A 7(a) loan can finance a practice purchase that includes goodwill, client lists and agreements not to compete, but the SOP limits intangible assets to 10 years while real estate can run 25, and it bars balloon payments on a 7(a) loan.
Equipment. A 504 project's fixed assets need a useful life of at least 10 years under SOP 50 10 8.1, while 7(a) equipment generally runs up to 10 years, or 15 where the IRS asset class useful life supports it. Shorter-lived items and working capital belong in a 7(a) loan or separate equipment financing.
The SBA condition. An SBA lender must certify that the practice cannot get the credit on reasonable terms without SBA's help, and under SOP 50 10 8.1 a practice whose cash flow and collateral meet the lender's conventional standards is not eligible. Needing a longer maturity than the lender's policy allows is one accepted reason, so a strong practice should see conventional offers in the same comparison.
Rate context. Under SOP 50 10 8.1, a variable 7(a) rate above $350,000 cannot exceed its base rate, prime or SBA's optional peg rate, plus 3%. The Federal Reserve's H.15 release put the bank prime rate at 7.00% on November 6, 2026. On a prime base, that makes the ceiling 10.00%, by our arithmetic. The SOP says the 10-year Treasury is most commonly the benchmark for 20- and 25-year 504 debentures, and H.15 put it at 4.86% that day.
How much down payment does a practice need?
A practice that has operated for more than two years needs at least 10% of the project cost for an SBA 504 loan, rising to 15% for a newer practice or a limited or single purpose building and 20% when both apply, under 13 CFR 120.910. 7(a) and bank lenders set the figure by policy.
The second test reaches medical buildings directly. SOP 50 10 8.1, which calls the category Limited or Special Purpose Property, lists "hospitals, surgery centers, urgent care centers, and other health or medical facilities" among its examples, and defines it as a limited-market property whose design, construction materials or layout restricts it to the use it was built for. The CDC must state its conclusion in its credit memorandum. A yes moves an established practice from 10% to 15% down and caps the 504 loan at 35% of the project, so get the CDC's call before you sign the purchase contract.
On a 7(a) loan for an established practice buying its building, SOP 50 10 8.1 leaves the equity amount to the lender, which must find it sufficient; it sets a 10% minimum for a start-up operating one year or less and for buying a practice, including real estate bought with it. A conventional loan follows bank policy, within the 85% loan-to-value ceiling for completed commercial property in the interagency real estate lending guidelines at 12 CFR Part 34, which a bank may exceed only for a limited share of its loans.
Illustrative example, our arithmetic: a practice operating for six years buys a building for $1,800,000, with no other project costs.
- Standard 504: the practice puts in $180,000 (10%), the bank's first mortgage is $900,000 (50%) and the 504 loan is $720,000 (40%).
- If the CDC classes the building as special purpose: $270,000 down (15%), the same $900,000 bank loan and a $630,000 504 loan (35%).
- If the practice had been open only 18 months, in that special purpose building: $360,000 down (20%) and a $540,000 504 loan (30%).
- A conventional loan at the 85% ceiling, if the building appraises at the price: at least $270,000 down, and more from a bank whose policy sits lower.
What do lenders check on a medical practice borrower?
Lenders check a medical practice borrower on the practice's cash flow first and its owners second: SBA rules require debt service coverage of at least 1.15 times, a personal guaranty from every owner of 20% or more and majority occupancy of the building, and a practice that depends on one physician may need life insurance on that physician.
Cash flow. SOP 50 10 8.1 requires debt service coverage of at least 1.15 on a standard 7(a) loan and 1.0 on a global basis, at least 1.15 on historical results for a 504, and 1.25 for buying a practice as an initial acquisition. Lenders adjust cash flow for items such as owner's draw and rent payments; for a practice buying its building, the rent it stops paying its landlord is part of the cash that will carry the new loan.
Documents. For a 7(a) application, SOP 50 10 8.1 calls for business financial statements or tax returns for the last 3 years, interim statements dated within 120 days, IRS tax transcripts, and a personal financial statement from each owner of 20% or more, signed within 90 days.
Owners. Under 13 CFR 120.160, holders of at least a 20% ownership interest generally must guarantee an SBA loan, and SOP 50 10 8.1 has the lender review each owner's and guarantor's personal credit report.
Occupancy. Under 13 CFR 120.131, the practice must occupy at least 51% of an existing building, or 60% of new construction, for either SBA program; the 504 guide linked above covers the holding-company structure.
Size. SBA loans go only to small businesses. Under 13 CFR 121.201, offices of physicians (other than mental health specialists) are small up to $16.0 million in annual receipts and offices of dentists up to $9.0 million, and 13 CFR 121.301 offers an alternative net worth and net income test for 7(a) and 504 loans.
Key person. Under SOP 50 10 8.1, when an SBA loan is not fully secured, life insurance is required on the principals of a sole proprietorship, a single-member LLC or a business that depends on one owner's active participation, which describes a solo practice.
A practice purchase. If you are buying the practice as well, SOP 50 10 8.1 requires an independent business valuation once the purchase price of the business tops $350,000, and a quality of earnings report as well when the price of an initial acquisition reaches $3 million.
How do you get lenders competing to finance your practice's building?
You get lenders competing to finance your practice's building by putting one complete package, with three years of practice financials, the purchase contract, the occupancy plan and the build-out and equipment budget, in front of SBA, bank and credit union lenders at the same time, so every offer prices the same file.
Option 1: a brokerage that runs the comparison (our top pick: YieldStack). YieldStack is our top pick for AI-native commercial mortgage brokerage on a practice's building purchase; "our" means YieldStack, which publishes this guide. YieldStack is an AI-native commercial mortgage brokerage that arranges financing for commercial real estate investors. The 5-minute submit captures the building and the purchase; the software matches the deal against 20,000+ loan programs and typically returns 5–8 matches, and the median first offer arrives in under an hour, from an institutional lender. Brokers then structure the request and negotiate the down payment, the fixed-rate period and the guaranty on the practice's side. It costs Zero upfront to submit a deal and review offers; YieldStack's broker fee is 0.50–1.00% of the loan amount and is paid only at closing. Every credit decision is made by the lender; YieldStack arranges the introductions and negotiates on the borrower's side, and no loan, rate, or closing is guaranteed. Submit your practice's building purchase.
Option 2: go lender by lender. Call your bank, an SBA lender, a Certified Development Company and a credit union one at a time. You keep each conversation, but you rebuild the file for every lender and compare offers written on different dates.
For the property-type view of the same purchase, see medical office financing and the program summary on SBA loans.
The bottom line
Start the comparison with a brokerage that compares the SBA, bank and credit union routes from one practice file; YieldStack, which publishes this guide, is our top pick for that. Judge every offer on the same three tests: the cash the practice puts in, 10% to 20% on a 504; how long the rate stays fixed; and whether goodwill and equipment fit, since a 504 loan cannot carry goodwill. Get the CDC's special purpose call before you sign the contract.