How to Buy a Veterinary Clinic With an SBA Loan
A veterinary clinic sale moves a premises permit, a controlled-drug cabinet and years of client relationships at once, and the state decides whether someone who is not a veterinarian can own any of it.
See if your deal qualifies →SBA FOIA 7(a) loan-level data, NAICS 54194*, FY2021 through FY2026.
What you need to put in
Ten percent of the total project cost is the SBA minimum for buying a business, and the project cost is everything the loan pays for: the purchase price, the closing costs, and the working capital you are borrowing to get through the first months.
Half of that ten percent can be a seller note, which is the structure most buyers are hoping for. The catch since June 2025 is that the note has to be on full standby for the entire life of the SBA loan, meaning no principal and no interest paid to the seller for ten years. A note on two year standby, which used to qualify, no longer counts toward your injection. The other five percent has to be real money, and the lender will trace where it came from.
On rate, an acquisition loan of this size prices near Prime plus 2.75 percent, with Prime plus 3.0 percent the SBA ceiling above $350,000. Ten year term, no balloon, and no prepayment penalty at that maturity. If real estate is part of the purchase the term stretches and the arithmetic changes.
What to diligence in a veterinary clinic
The generic acquisition checklist covers the financials. These are the ones specific to this sector, and they are where deals here actually go wrong.
Ownership rules vary sharply by state
Some states let a non-veterinarian own a clinic as long as a licensed veterinarian makes the medical decisions, and others restrict ownership to veterinarians. If you are not a veterinarian, or you are buying with a partner who is not, confirm the structure is legal in your state before you spend money on reports. If you are a veterinarian buying through a company, make sure the entity type and ownership fit the state's rules too.
The premises permit and the controlled drugs
Many states license the clinic premises separately from the veterinarians who work there. In California, for example, the premises registration is not transferable: the current registration holder has to notify the veterinary board within 30 days after a change of owner, and the new owner applies for its own registration. Clinics routinely keep controlled substances for anesthesia, pain control and euthanasia, and a DEA registration does not pass to a buyer without DEA's written consent. Plan for your own registration, any state controlled substance registration, and a full documented inventory count on the closing day.
Revenue by doctor and by service line
Break revenue down by veterinarian and by line: wellness and vaccines, surgery, dentistry, diagnostics, pharmacy, boarding and grooming. If the selling veterinarian produces most of the surgery or sees most of the long-standing clients, plan how that work and those relationships move to you or an associate. Look at the pharmacy trend separately, because clients can buy many of the same medications online. Ask how active clients are defined and what share are on reminder schedules, since that is the clinic's recurring revenue.
Associates, and the contracts behind the equipment
If the clinic depends on associate veterinarians, read their agreements: pay structure, notice period, and any non-compete, whose enforceability varies by state. Associates are hard to replace in many markets, so find out early who intends to stay. On the equipment side, check the age of digital radiography, ultrasound, anesthesia and dental units, and read the supply or rental agreements behind in-house lab analyzers, which can carry multi-year purchase commitments that pass to the new owner. X-ray units are also registered with the state in many places, and a change of ownership may need to be reported.
Licensing and regulation in this sector vary by state and change. This is a general description, not advice on your deal, so check anything you are going to rely on against your own state's current rules.
What the lender will ask you about
Beyond the usual credit questions. Have these answered before the file goes in and you save a round trip.
- ·Is the buyer a licensed veterinarian, and does the state allow the proposed ownership structure?
- ·How much revenue does the selling veterinarian produce personally, and which associates are staying?
- ·What share of revenue is pharmacy, boarding and grooming versus medical services, and how has that mix moved?
Who actually lends on veterinary clinics
Live Oak Banking Company has approved more loans in this sector than anyone else since FY2021, at an average of $2.2M. A lender who has done dozens of these already knows what the licence transfer looks like, which is worth more than a slightly better rate.
| # | Lender | Loans | Total Volume | Avg Loan |
|---|---|---|---|---|
| 1 | Live Oak Banking Company | 390 | $846.5M | $2.2M |
| 2 | The Huntington National Bank | 134 | $87.9M | $656K |
| 3 | Fifth Third Bank | 59 | $121.6M | $2.1M |
| 4 | Wells Fargo Bank National Association | 51 | $68.6M | $1.3M |
| 5 | Bank of America, National Association | 47 | $37.7M | $802K |
| 6 | United Community Bank | 38 | $54.4M | $1.4M |
| 7 | TD Bank, National Association | 29 | $10.2M | $353K |
| 8 | First Financial Bank | 28 | $23.7M | $848K |
Source: SBA FOIA 7(a) loan-level data, NAICS 54194*, FY2021 through FY2026. Lenders with fewer than 3 approved loans in the sector are excluded.
Full veterinary clinics lending data →Busiest states for veterinary clinics
Buying a veterinary clinic: common questions
Can I buy a veterinary clinic if I am not a veterinarian?
In some states, yes, provided a licensed veterinarian controls the medical decisions. In others, ownership is limited to veterinarians. Lenders will also want to see who will run the medicine day to day and that they are committed to staying. Check your state's rule first.
Do I need my own DEA registration?
Yes, plan for one. A DEA registration does not transfer with the business unless DEA consents in writing, and on the transfer date the controlled substance inventory has to be counted and recorded. Some states also require their own controlled substance registration, so start both well before closing.
What happens to the patient records?
In most purchases they are part of what is sold and a big part of what you are paying for. State veterinary boards set rules on how long records must be kept and how clients can get copies, so make sure the purchase agreement covers the records and the practice software that holds them.
How much does it cost to buy a veterinary clinic?
Across the sector, the average approved SBA 7(a) loan is $1.2M, taken over 1,508 loans since FY2021. That is the loan, not the purchase price: the loan usually also carries closing costs and working capital, and the buyer puts in at least ten percent on top. Use it as a sense of scale rather than a quote.
How long does an SBA loan to buy a veterinary clinic take?
Sixty to ninety days from a complete file is the honest range for a straightforward acquisition, and it is the FILE that sets the clock rather than the bank. A lender with SBA Preferred Lender status approves in house instead of waiting on SBA review, which takes weeks out. Anything that needs a third party, an appraisal, an environmental report, a licence transfer, runs on its own schedule.
What can the loan actually pay for?
The purchase price of the business, the closing costs, working capital for the transition, and the real estate if you are buying the building too. A 7(a) loan for goodwill is typically a ten year term with no balloon and no prepayment penalty. Add owner-occupied real estate and the term stretches, up to twenty five years where the property is the majority of the project.
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