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A few years ago, a seasoned pediatrician asked for my advice on getting financing for his private practice. He'd been working for many years by this point, but wanted to start his own business independently and needed capital to build an office.
He wanted to buy an existing commercial real estate property and transform it into a space with four exam rooms, a reception area, and a kid-friendly waiting room. On top of those renovations, he'd need capital to staff and stock the practice before being able to open and take patients.
Pediatrics is a specialty within the general medical practice world that often comes with its own particular financing needs. Its business relies heavily on, for example, an inventory of vaccinations and a large patient base that pays with insurance or Medicaid. Those are important considerations when looking into which loan options are the best fit.
At Clarify Capital, we were able to save him the pain of shopping bank by bank for loan offers and options. In just a few weeks, my team and I helped him explore financing options, connect with several lenders, and ultimately receive multiple loans.
This pediatrician is just one of hundreds of medical professionals we've helped get set up for private practices, so I'm familiar with what the best financing options for pediatricians really look like. I'll walk through what they are, the best fit for the biggest expense categories, and how to apply when you're ready.
| Best For | Typical Amount | Typical Term | Rate / Estimated Cost | Speed to Funding | |
|---|---|---|---|---|---|
| SBA 7(a) loan | Buying or expanding a practice, real estate, or a large build-out | Up to $5 million | Up to 10 years (working capital, equipment) or 25 years (real estate) | About 9.75% to 13.25% APR (SBA caps the rate at the prime rate plus 3.0% to 4.5%; prime is 6.75% as of June 2026 | As quickly as two weeks (typically 30 to 90 days) |
| Term loan | One-time, defined costs like an equipment package or a build-out phase | $10K to $5M | Can do short-term loans or long-term loans | APR from 6% | As fast as same day |
| Business line of credit | Smoothing the Medicaid gap and restocking vaccine inventory (a draw, repay, repeat system) | $5K to $5M revolving | 6 to 36 months; payments weekly or monthly | APR starting at 6%; only pay interest on what you draw | As fast as same day once approved |
| Equipment financing | Buying specific equipment/machinery, like exam tables, scales, screeners, and a vaccine refrigeration system | Up to 100% of equipment cost | 12 to 72 months | APR from 6% and up; equipment = collateral | As fast as 1 to 5 days |
| Invoice factoring | Turning unpaid insurance and Medicaid claims into cash now | An advance of 75% to 100% of invoice value | Tied to when invoiced customer pays, typically 30, 60, or 90 days | Uses discount fee per invoice (no fixed APR); from 0.5% to 5% per invoice per month | Usually 1 to 2 weeks |
| Merchant cash advance | Fast, short cash gap when speed beats cost | Depends on monthly revenue; higher revenue= higher cost | No fixed term, estimated repayment length based on monthly sales; payments daily, weekly, or monthly | Priced as a factor rate (not an APR); typically from 1.08% to 1.45%; typically the highest cost in this list | As fast as same day |
The Biggest Expenses for Pediatric Practices
To understand which financing options and loans are going to be best for your practice, you also have to know what parts of the business cost the most and require the most investment. These are the four areas where I see the most capital need from pediatricians opening or acquiring a practice, along with the financing options that I think are best suited to cover each of them.
Child-Friendly Build-Out
This is likely going to be the highest up-front cost. An interior build-out for a typical medical office is about $150 to $300 per square foot. That means, for example, a 3,000-foot space would run you anywhere from $450,000 to $900,000.
You'll also need to get furniture and, if you want to go the extra mile, have some kid-friendly aspects of the reception or waiting room area.
My financing recommendation: Term loan or SBA 7(a) loan (if you're buying the space)
An SBA 7(a) loan is a flexible and partially government-guaranteed loan. They can go up to as much as $5 million and typically require you to put about 10% down. They're known for their great rates and long repayment terms, and are typically quite accessible in terms of qualifying.
Vaccine Inventory
A huge part of pediatric medical care is administering vaccinations: one child following the CDC's recommended immunization schedule will typically receive about two dozen vaccine doses in just their first 18 months of life.
Pediatricians usually buy their vaccine supply up front and in bulk, taking on the cost themselves at first so they can have supplies on hand and ready to administer. Many children are covered by medical insurance or Medicaid*, so practices have to wait for reimbursement from those companies for such services before they recoup their investment.
This can quickly get costly: A single 10-dose pack of the HPV vaccine Gardasil 9 is about $3,290. That's not including the overhead for storage, inventory, administration, and spoilage.
My financing recommendation: A business line of credit or a short-term business loan
A business line of credit (LOC) is designed for borrowing cash. A lender deposits money into your business bank account, which you can draw from as needed, pay back, and then re-draw from continuously. You only pay interest on that borrowed portion, not on the unused credit.
A short-term loan gives you a lump sum of money that you pay back with a set interest rate over a fairly short period of time (usually six months to three years). The payments can be bigger, but the trade-off is that you finish paying it off faster.
A special note on the Medicaid reimbursement gap: Children make up about 48% of Medicaid and CHIP enrollment, so pediatrics carries an especially heavy Medicaid mix compared to other medical practices. Medicaid pays about two-thirds of Medicare rates, and even clean claims can take up to 90 days to pay. To bridge that working-capital gap, I recommend using a business line of credit, invoice factoring (also known as medical receivables factoring) to get cash now against unpaid claims, or a merchant cash advance if you find yourself in urgent need across short cash gaps.
Pediatric Exam Equipment
To outfit your exam rooms with the necessary equipment, you'll need a significant investment in things that are specific to pediatrics, like:
Child-size scales
Length boards
Exam tables
Cabinetry
Chairs
Vision and hearing screeners
Purpose-built or pharmaceutical-grade vaccine refrigeration units
My financing recommendation: Equipment financing
Equipment financing is a type of small business loan designed specifically for buying all types of equipment, machinery, or vehicles. You get it as a lump sum, then pay it each month over a fixed term. There's usually no down payment, and qualifying is also fairly accessible because the equipment itself acts as collateral.
Technology
Your practice is going to need to invest in an electronic health record (EHR) to keep track of patient records (including things like immunization registries and growth charts) as well as your office schedule and appointment booking system. You'll have to get:
Computers
Wi-Fi system
Phone system
Software and practice management systems (PMS)
Planning through the first year of EHR use typically costs about $47,000 per physician.
My financing recommendation: For the hardware, I recommend equipment financing. I'd suggest rolling software subscription costs into a business line of credit.
Why Pediatric Practice Owners Work With Clarify
Clarify Capital's 5.0 Trustpilot rating is the highest in the industry, and we've placed more than $1 billion across 50,000+ small to midsize businesses.
Clarify matches you across 75+ vetted lenders and can get you a written offer in as quickly as 24 hours.
Every applicant works with a U.S.-based lending advisor (not a chatbot or a call center) from application through financing.
Minimum Qualifications
$10,000 in monthly revenue
Your business must earn at least $10K per month in a business bank account.
500+ credit score
You can get approved with any credit score. But the better your credit rating, the better interest rates lenders offer. Your FICO score should be above 500.
Minimum six months in business
Your company should be operational for a minimum of six months. This shows business lenders that your company is sustainable and won't go out of business.
Have a business bank account
Your Clarify advisor will need three or four months of your most recent bank statements to verify income. This is just to see you're actually making $10K+ month in revenue.
How To Apply for Pediatric Practice Financing
Step 1: Apply online
It takes about two minutes. You’ll need your medical practice's legal name, EIN, time in business (or projected open date for a new practice), monthly revenue (or projected revenue), requested loan amount, owner contact information, and a credit authorization. Apply here.
Step 2: Connect with a lending advisor
A U.S.-based Clarify Capital lending advisor reviews the application, runs a soft credit pull (no impact to your score), and requests 3 to 4 months of recent business bank statements. For acquisition financing, expect a deeper request: trailing 12 months profit and loss statement (P&L), balance sheet, tax returns, and the target practice's financials.
Step 3: Get matched and funded
Clarify works with 75+ vetted lenders and matches your profile to the lender most likely to approve you at the best terms. Approved files often get a written offer the same day. You can sign electronically, complete the ACH setup, and the funds will hit the practice's business bank account as soon as that day.
Get the Funding You Need
Here's the bottom line and what I want you to take away: When it comes to a pediatric medical practice, I recommend business owners match each of their build-out needs to the type of financing best built for it rather than reaching for one all-purpose loan to cover everything.
My team and I at Clarify can help you explore the best options for your business. Get started and apply today.
Frequently Asked Questions
Here are answers to questions I often get about financing for pediatric practices.
What Credit Score Do You Need for a Pediatric Practice Loan?
It depends on the type of financing. Clarify can fund credit scores over 550, often as fast as same day, because its options are revenue-based. SBA 7(a) loans are stricter and look for stronger credit and full documentation.
How Much Is the Monthly Payment on a $50,000 Practice Loan?
It varies widely based on your rate and payment terms. Here's an example: a $50,000 loan at a 10% APR costs about $1,613 a month over three years, or about $1,062 over five years. A shorter term means a higher monthly payment but less total interest.
How Hard Is It To Get a $1 Million Loan for a Practice?
It's doable for an established practice. SBA 7(a) loans go up to $5 million, for example. Clarify also funds up to $5 million. Expect to show time in business, revenue, and recent bank statements.
Can I Get Financing To Buy or Take Over a Pediatric Practice?
Yes. Practice acquisition is a classic SBA 7(a) loan use case. Clarify finances businesses that have been operating for six months or more, so buying an established practice, not a brand-new practice from scratch, fits.
Do Pediatric Practice Loans Require Collateral?
It depends. For an SBA 7(a) loan or a bank loan, you may have to put up collateral. In equipment financing, the equipment serves as collateral. For invoice factoring, the invoice is the collateral. For merchant cash advances, short-term loans, and business lines of credit, no collateral is typically required.
How Do Pediatric Practices Pay for Vaccine Inventory?
Most use a business line of credit or short-term financing to buy private vaccine stock up front and then repay as insurers reimburse.
Bryan Gerson
Co-founder, Clarify
Bryan has personally arranged over $900 million in funding for businesses across trucking, restaurants, retail, construction, and healthcare. Since graduating from the University of Arizona in 2011, Bryan has spent his entire career in alternative finance, helping business owners secure capital when traditional banks turn them away. He specializes in bad credit funding, no doc lending, invoice factoring, and working capital solutions. More about the Clarify team →
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