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How do you finance a dental practice acquisition?

Many buyers finance a dental practice with an SBA 7(a) loan, which the U.S. Small Business Administration caps at $5 million for most loans and allows for changes of ownership. The SBA guarantees up to 85% of loans of $150,000 or less and up to 75% above that, so the lender, not the SBA, still decides (deal-sourcing guide).

By DDSIntel Editorial· Published · Data as of

Key numbers

  • 5,000,000 US dollars, the maximum amount of most SBA 7(a) loans SBA, 2026
  • 75% percent of a 7(a) loan above $150,000 is guaranteed by the SBA, at most SBA, 2026
  • 25 years, the longest 7(a) maturity, which applies to real estate SBA, 2026
  • 60% percent of price paid in cash at close, low end of DSO offers TUSK Practice Sales, Q3 2026 dental market report, 2026

Can an SBA 7(a) loan buy a dental practice?

Yes. The SBA lists changes of ownership, complete or partial, and acquiring a business among permitted 7(a) uses. Most 7(a) loans have a maximum of $5 million. A bank or other SBA lender makes the loan, and the SBA guarantees part of it. Eligibility and underwriting rules change, so confirm them with the lender.

The deal-sourcing guide shows where financing sits in the buy-side process.

How much does the SBA guarantee?

For standard 7(a) loans the SBA guarantees up to 85% of loans of $150,000 or less and up to 75% of loans above $150,000. The guarantee protects the lender, not the borrower. The buyer still signs for the loan and usually gives collateral and personal guarantees.

A buyer should ask the lender which guarantee and collateral rules apply to the specific loan.

How long can a practice loan run?

Under 7(a) rules a loan matures in ten years or less, unless it finances real estate or equipment with a useful life over ten years. Real estate loans can run a maximum of 25 years, including extensions. Longer terms lower the payment but raise total interest, so model both.

If the sale includes the building, ask counsel and your CPA how to separate the real estate from the practice in the purchase structure.

What do sellers expect at closing?

TUSK Practice Sales reports DSO offers with 60% to 85%+ of the consideration paid as cash at close. A private buyer relying on a loan should expect a seller to compare that against any seller note or deferred payment, and should plan the down payment and working capital early.

Price benchmarks are in how practices are valued. Associates buying in gradually have other routes, covered in the associate buy-in.

Frequently asked questions

Do I need a down payment?

Lenders usually require equity from the buyer. The amount depends on the lender and the deal, so ask before making an offer.

Is the SBA the lender?

No. Banks and other approved lenders make 7(a) loans; the SBA guarantees a share.

Can I borrow more than $5 million?

Most 7(a) loans are capped at $5 million. Larger deals use other financing, alone or alongside a 7(a) loan.

Is this financial advice?

No. It is general information. Have your lender, CPA and counsel review the terms. See signals and market data for market context.

Sources

  1. U.S. Small Business Administration. 7(a) loan program: terms, conditions and eligibility. sba.gov.
  2. TUSK Practice Sales. TUSK Practice Sales Assesses the State of the Dental Industry in Its Q3 2026 Dental Market Report (July 10, 2026). pr.timesenterprise.com.

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