If you’re a doctor considering ownership in a medical practice, you’ve probably heard the term physician practice buy in loan. This type of financing helps you purchase a stake in an existing practice instead of starting from scratch. My wife and I have been through this process ourselves, so I know first-hand how overwhelming it can feel at the start. The good news is, with the right guidance and lender, you can navigate it step by step.
Step 1: Understand What a Physician Practice Buy In Loan Covers
A physician practice buy in loan is designed to cover the cost of purchasing ownership in an established medical practice. Instead of building a patient base from zero, you buy into an organization that already has patients, staff, and systems in place.
These loans usually cover:
- The equity purchase (the buy in amount agreed upon with partners)
- Legal and accounting fees
- Transition costs like credentialing and EMR updates
- Working capital to help with cash flow in the first few months
👉 If you’d like a list of preferred lenders that specialize in healthcare loans, email me directly.
Step 2: Calculate the True Cost of a Buy In
The cost of a physician practice buy in loan typically ranges from $150,000 to $500,000+, depending on the specialty, practice valuation, and location.
It’s important to work with a CPA who understands medical practices. They’ll break down whether you’re paying for:
- Hard assets (equipment, property, accounts receivable)
- Intangible value (goodwill, patient base, reputation)
Being clear on this helps you avoid overpaying for “soft” value.
Step 3: Know Your Financing Options
Doctors have unique leverage with lenders because of predictable income and strong long-term demand for healthcare. Here are common physician practice buy in loan sources:
- Private Banks: Often offer tailored programs for doctors, sometimes unsecured.
- National Lenders: Bank of America, Wells Fargo, and Live Oak Bank all have healthcare lending divisions.
- Local Banks/Credit Unions: Can be competitive if you already have a strong relationship.
- SBA Loans: The SBA 7(a) program can work but is slower and paperwork-heavy.
📩 Need introductions to Local Private Lenders that my clients and I have actually used? Email me here and I’ll connect you.
Step 4: Compare Loan Terms
Not all physician practice buy in loans are equal. Here’s what to compare:
- Loan term (5–10 years is typical)
- Fixed vs. variable interest rates
- Prepayment penalties
- Monthly payment vs. projected income
- Whether collateral is required (many are unsecured for doctors)
If you’re also relocating to Huntsville for your career, you’ll want to think about how these payments fit into your housing budget. Check out my Physician Relocation Guide to Huntsville for cost-of-living and neighborhood insights.
Step 5: Prepare Your Financials
Most lenders will want to see:
- Personal tax returns (2–3 years)
- Credit score (680+ is usually needed)
- Practice valuation and financial statements
- Student loan balances
- Partnership agreements or contracts
Preparing these upfront makes approval smoother and positions you as a strong borrower.
Step 6: Apply and Get Pre-Approved
Pre-approval for a physician practice buy in loan gives you a realistic picture of what you can afford and strengthens your position in negotiations. It also lets you compare multiple lenders without surprises at closing.
For a deeper overview of options and strategies, visit my Physician Practice Buy In Loan Guide (pillar page).
Step 7: Close and Transition into Ownership
Once the loan funds, your buy in is complete. Payments typically go directly to the selling partner(s) or the practice entity. Expect an adjustment period as your distributions change, and budget for reinvestment early on.
FAQs About Physician Practice Buy In Loans
Q: Are these loans unsecured?
Many private banks and healthcare lenders offer unsecured options, though collateral may be required for larger loans.
Q: Will my student loans affect approval?
Yes, but lenders often view physician earning potential as outweighing existing debt.
Q: What’s the typical interest rate?
Most physician practice buy in loans in 2025 range between 7–10%, depending on credit profile and lender.
Q: How is the buy in amount decided?
It’s based on a professional practice valuation (assets, receivables, and goodwill). Always review with a CPA or attorney.
Why This Matters
Choosing the right physician practice buy in loan is more than financing—it’s a career decision. Ownership gives you equity, stability, and a say in how your practice is run. I’ve been through this process personally with my wife, and I’ve guided many clients through it as well.
If you’re even considering this step, don’t try to navigate it alone.
📧 Email me today to get my preferred lender list, set up a one-on-one conversation, or learn what to expect in your specialty.
