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Last spring, a physical therapist in Frisco, Texas, contacted me looking to finance $180,000 worth of new equipment for his business. He needed a high-low treatment table, an ultrasound and electrical-stimulation combo unit, and a complete strength and conditioning rack.
When he reached out to his commercial lender, they told him he needed 18 months of financial statements. But he'd only been open for six months. Luckily, I was able to find him a loan through Clarify Capital's network of lenders that was much more flexible and made sense for his specific needs.
Below, I break down what financing really looks like for a new physical therapy practice. I'll explain the different loans available to you, show you how to prepare for credentialing, and walk you through the application process.
| Loan type | Typical amount (Clarify Capital) | Typical APR/cost | Repayment term | Funding speed | Best fit for a PT practice |
|---|---|---|---|---|---|
| Equipment financing | Up to 100% of equipment value | APR starting at 6% | 12 to 72 months | 1 to 5 days | The $75K to $200K equipment package (treatment tables, ultrasound/e-stim, strength and conditioning gear, hydrotherapy hardware). Equipment serves as collateral; Section 179 in year 1 makes the math favorable. |
| Working capital loan (short-term) | $10,000 to $5,000,000 | APR starting at 6% | 6 to 36 months | As fast as same day | Payroll bridge during the credentialing window (60 to 180 days per payer), patient-acquisition marketing, the working-capital cushion before insurance reimbursement is reliable. |
| Business line of credit | $10,000 to $5,000,000 | APR starting at 6%; interest on drawn balance only | 6 to 36 months on drawn balance | As fast as same day | Ongoing insurance-reimbursement timing gaps once the practice is operating (Medicare and commercial typically pay 30 to 90 days after service), surprise expense buffer, payroll smoothing across reimbursement cycles. |
| SBA 7(a) loan | Up to $5,000,000 | APR starting at 6.75%; rate caps base rate + 3.0% to 6.5% depending on loan size | 10 to 25 years | As fast as two weeks (typically 30 to 90 days) | Practice acquisition, opening a second location, the build-out (especially when bundled with equipment and working capital into one SBA package), or owning the building. Longer payback matches the asset life. |
The Four Funding Needs Unique to a Physical Therapy Practice
Below are the four main categories I see PT clinics spending money on during their first year in business.
| Cost category | Cost range | Details |
|---|---|---|
| Equipment | $75,000–$200,000 | Includes treatment tables, ultrasound and electrical stimulation units, exercise and strength-conditioning equipment, manual therapy tools, and front-office technology. Basic equipment setups start around $60,000. Treatment tables typically cost $500 to $3,000 each, while ultrasound/e-stim combo units cost about $3,500 to $3,600. |
| Build-out costs | $50,000–$150,000 | These costs typically cover some build-out of ADA-compliant treatment rooms, open gym space, and reinforced flooring, plus installation of dedicated electrical systems and hydrotherapy plumbing. Electrical and plumbing work can run $20 to $50 per square foot. An HVAC system can run $10 to $20 per square foot. Medical-grade epoxy flooring can run $8 to $15 per square foot. In general, basic build-out on a new clinic takes at least $75,000, but specialty build-outs can easily top $150,000. |
| Staff pay during credentialing | Varies | Credentialing delays create real cash-flow problems. Commercial payers take 90 to 180 days to approve providers, and Medicare takes 45 to 90 days. Medicaid varies by state because processing times differ. Once an insurer approves a provider's credentialing application, it usually won't reimburse for visits or services completed before approval. That's a problem, because providers still have to pay wages and operating costs while they wait. According to the Bureau of Labor Statistics, the median annual wage for physical therapists in 2024 was $101,020. |
| Working capital for reimbursement lag | Ongoing Need | Even after a practice gets credentialed, it still waits 30 to 90 days for an insurer to reimburse a service. Medicare slightly increased its 2026 reimbursement rate, but the bigger cash-flow challenge is still the time an insurer takes to pay. A line of credit can fill the gap when payments are slow, and you repay it once the insurance payments come in. |
Financing Beats Leasing PT Equipment
Not sure if you should finance or lease your equipment? There are benefits and drawbacks to both.
Some business owners seek out a lease because it is tax-deductible. But the truth is that Section 179 makes a purchase deductible, too, all in year one instead of spread over five.
| Buying vs. Leasing Equipment | |||
|---|---|---|---|
| Aspect | Cash purchase | Equipment loan (5 yr, 7% APR) | 5-year operating lease ($2,200/mo) |
| Upfront cash outlay | $100,000 | $0 (some lenders ask 10% down: $10,000) | First/last month + security ($5,000 to $7,500 typical) |
| Monthly payment | $0 | ~$1,980 | $2,200 |
| Total paid over 5 years | $100,000 | ~$118,800 | $132,000 |
| Year-1 tax write-off | $100,000 via Section 179 (full purchase price deducted in year 1, up to $2,560,000 limit for 2026) | $100,000 via Section 179 (the financed amount is treated as a purchase for tax purposes; full deduction year 1) | ~$26,400 (lease payments deducted as operating expense in year 1) |
| Year-1 tax savings (30% bracket) | $30,000 | $30,000 | ~$7,920 |
| Year-1 after-tax cash flow | -$70,000 (paid $100K, saved $30K in taxes) | +$6,240 (paid $23,760, saved $30,000 in taxes — net cash-positive) | -$18,480 (paid $26,400, saved $7,920 in taxes) |
| 5-year after-tax total cost | $70,000 | $88,800 ($18,800 in interest over 5 years offsets some of the Section 179 benefit) | $92,400 ($26,400/yr lease × 5 = $132,000, minus 30% tax deduction across 5 years) |
| Equipment ownership at end of 5 years | Yes (asset stays on the books, can be sold or kept) | Yes (asset stays on the books) | No (return to lessor or buy out at fair market value, typically 10 to 20% of original cost) |
Federal Loan Repayment and Forgiveness Programs for Physical Therapists
Student debt shouldn't stop you from opening a PT clinic. Some Doctor of Physical Therapy (DPT) graduates open their own PT businesses, carrying $100,000 or more in school debt. If this sounds like you, there are some federal and state programs that can help you manage your loans while you finance a PT clinic.
| Program | Details |
|---|---|
| Public Service Loan Forgiveness (PSLF) | Many PTs who've worked full-time at a qualifying nonprofit or government employer can qualify for PSLF, as long as they make 120 qualifying payments (about 10 years) on a qualified payment plan and their employer meets the requirements. After those 120 payments, any remaining balance on their student loans is forgiven, and the forgiven amount is tax-free. There's also no cap on how much can be forgiven. Program rules do change, so it's wise to check the current rules with the Department of Education before you rely on PSLF as a long-term strategy. |
| HRSA programs (mixed PT eligibility) | The Health Resources and Services Administration (HRSA) runs the National Health Service Corps (NHSC) Loan Repayment Program. Physical therapists can usually apply for State Loan Repayment Programs (SLRPs), but they aren't one of the three primary areas the NHSC focuses on (primary care, dental, and behavioral health). |
| State PT loan repayment programs | Some states offer loan repayment programs for therapists working in rural or underserved areas. Each state varies a lot in which programs are available, what the requirements are, and the maximum awards. Search online for your state's loan repayment programs to get the most current information. |
| Refinancing student loans | Some physical therapists refinance their federal student loans into private loans to take advantage of lower interest rates and smaller monthly payments. Just keep in mind that converting a federal loan to a private one means losing access to PSLF, income-driven plans, and other federal benefits. It's worth comparing all the costs and possible benefits before you refinance. |
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.
Get a PT Practice Loan Quote
Every applicant through Clarify Capital works with a U.S.-based lending advisor, not a chatbot or a call center, from your first question through funding. Our Trustpilot rating is the highest in the industry, and we've placed more than $1 billion across 50,000+ businesses.
Apply online
About two minutes. Provide your legal name, EIN, time in business (or projected open date for a new practice), monthly revenue (or projected revenue), requested loan amount, owner contact, and credit authorization.
Connect with your lending advisor
A U.S.-based Clarify Capital lending advisor reviews the application, runs a soft credit pull (no impact to score), and requests 3 to 4 months of recent business bank statements.
Get matched and funded
Clarify works with 75+ vetted lenders and matches the file to the lender most likely to approve at the best terms. Approved files get a written offer the same day, and funds hit the practice's business bank account the same day for files approved before mid-morning.
Apply today through Clarify Capital to get started.
Frequently Asked Questions About Physical Therapy Practice Loans
Below you'll find some of the most common questions that I hear from clients opening a PT clinic.
How Do Physical Therapists Get Business Loans?
Physical therapists have many of the same requirements to get a small-business loan as any other small-business owner. You provide your practice's Employer Identification Number (EIN), your current or projected monthly revenue, and your personal credit history. After that, a lender reviews your recent bank statements to see if you qualify. Clarify Capital's application takes about two minutes, and a 75+ lender network reviews your file instead of locking you into one lender's rules.
Can I Get a Loan To Start a Physical Therapy Clinic?
Yes, and it's probably one of the cleanest small-business cases in healthcare from a lender's point of view. Non-bank lenders usually want at least six months of business activity, but a new physical therapy clinic can sometimes qualify much sooner through Clarify Capital's network, based on a signed lease, a Doctor of Physical Therapy (DPT) license, equipment quotes in hand, and bank statements that show steady income. The loan terms and the total amount depend on your personal credit, the practice's projected monthly revenue, and the loan type you pick from equipment financing, working capital, or a Small Business Administration (SBA) loan.
How Much Does It Cost To Open a PT Practice?
A real-world physical therapy clinic budget is typically around $150,000 to $400,000. This includes equipment (about $75,000 to $200,000), build-out (about $50,000 to $150,000), and roughly the first six months of payroll and operating costs before steady income from insurance reimbursements. Industry models estimate a mid-size PT clinic at about $150,000 to $250,000. Larger PT clinics, like multi-site locations and sports rehabilitation clinics, may cost more than these ranges.
Is It Better To Lease or Finance Physical Therapy Equipment?
If you're trying to save money, financing is generally the better option, mostly because of Section 179. For example, if you finance a $100,000 piece of equipment over five years and use Section 179 in year one, you'd get a $30,000 tax savings (assuming a 30% tax bracket). So you'd keep more of your cash in year one. If you lease the same equipment for five years, you'd pay about $92,400 after taxes over five years and still own nothing at the end of the lease. The cash versus lease comparison section has the full breakdown.
How Long Does Insurance Reimbursement Take for a New PT Practice?
The time to get credentialed with commercial third-party payers varies, but it generally takes 45 to 180 days. Most commercial payers take the longer end (90 to 180 days), and Medicare takes the shorter end (45 to 90 days). Of all third-party payers, Medicare is one of the few that covers services delivered within 30 days before your credentialing approval date. The normal delay from delivering a service to getting paid is usually 30 to 90 days. That's why many well-established physical therapy clinics keep a line of credit open through a company like Clarify Capital, so they can keep covering payroll during this long payment cycle.
What Credit Score Do I Need for a Physical Therapy Practice Loan?
Non-bank short-term lenders usually start with applicants who have at least a 500 to 600 personal credit score. Bank short-term loans usually require at least 680, and SBA 7(a) underwriting is stricter still. Clarify Capital's working capital loan starts at a 550 personal credit score, and scores over 550 can also qualify for same-day funding. Because the equipment itself serves as collateral, equipment financing usually has softer personal-credit terms.
Is My Information Secure With Clarify Capital?
Yes. Clarify Capital follows SOC 2 security principles to protect your data. Checking your options won't affect your credit score, because our first review uses a soft credit pull. Only after you decide to move forward with an offer do we run a full credit check.
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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