Commercial loans for allied health practices

Chiropractors and optometrists appear on more medico lists than most allied health. Physiotherapists, psychologists and podiatrists appear on some. Occupational therapists, speech pathologists, dietitians and exercise physiologists rarely do. Lenders that include allied health usually require AHPRA registration where it applies and membership of the professional association, and some restrict the benefits to owner-occupied residential lending while assessing premises on ordinary commercial policy.

An allied health practice buying its rooms is assessed as an owner-occupier: two years of practice financials, the lease it currently pays, and the property. Lenders with healthcare business units understand Medicare, private health and NDIS billing and will assess sustainability of each. NDIS-dependent practices attract questions about client concentration and plan funding. LVR runs 65 to 75 per cent on standard policy and 80 per cent or more where medico policy applies.

Allied health practices are bought and sold with goodwill, equipment and sometimes the premises. Goodwill lending outside medico policy is conservative: 50 to 60 per cent of the goodwill value on cash flow, with the balance from the buyer's equity or a home as security. Multi-practitioner clinics with several income streams are easier to finance than single-practitioner practices where the goodwill leaves with the vendor.

Treatment rooms, gym equipment for physio, testing equipment for psychology and podiatry, and general fit-out are financed as equipment finance or a small business loan over three to seven years. Lenders keep this separate from the property.