Calculator
Practice acquisition loan calculator
A purchase price is a monthly payment with a decimal point moved. Set the price, the amortization, and a rate inside the market range, and the model returns the payment the practice has to carry out of collections that already exist.
Direct answer
Practition Finance publishes this model so a buyer can see what a purchase price costs per month before a term sheet exists. It converts price, term, and rate into a payment, then measures that payment against the seller's collections, which is the test an acquisition lender runs first.
As of October 2026
Run your numbers
Model the payment
Move the amount, the term, and the rate to see what the note costs per month and across its life
The price on the agreement, plus anything financed alongside it
Move this to the range your bank or the market is quoting
Monthly payment
$10,134
120 months at 9%, principal and interest
Interest across the term
$416,087
Before any origination, packaging, or guarantee fee the structure carries
Total repaid
$1,216,087
Principal plus interest, if the note runs to maturity with no prepayment
Educational arithmetic on the numbers you entered. It is not a quote, a promise to lend, or an indication of offers to come, and no funder has priced this file. Program availability varies by state.
| Assumption | What the model uses | Why it is set that way |
|---|---|---|
| Amortization | Level monthly payment, no balloon | Acquisition notes commonly amortize fully over 10 years, so a balloon changes the payment and is modeled separately. |
| Rate basis | Fixed nominal annual rate, monthly compounding | A variable structure prices off prime and moves with it, so a fixed rate keeps the comparison stable while the inputs change. |
| Working capital | Rolled into the financed amount | Most acquisition structures finance the price plus an operating cushion in one note, which is what the payment has to cover. |
| Fees | Not included in the payment | Guaranty fees, closing costs, and third-party reports vary by structure and appear in the SBA comparison model instead. |
| Taxes and rent | Outside the model | Occupancy, payroll, and supply costs stay in the practice's own operating statement, where a lender reads them. |
| Collections test | Applied against trailing 12-month collections | Coverage is measured on money the seller already collected, not on the projection a buyer builds after closing. |
Educational arithmetic on the numbers entered. It is not a quote, a promise to lend, or // copy-allow an indication of offers to come, and program availability varies by state.
How to read what it gives you
Start with the payment, not the rate
A quarter point moves an 800,000 dollar note by a small monthly amount. A 24-month change in amortization moves it far more. Set the term the structure actually supports first, then test rate sensitivity inside the market range on the program page.
Divide collections by the annual payment
Annualize the monthly payment and compare it to what the seller collected over the trailing 12 months after owner compensation is normalized. That ratio is the number an acquisition underwriter computes in the first 5 minutes of reading a file.
Test the price against production, not the asking sheet
Collections drive the note. If production and collections diverge, the payment sits on the smaller of the two. Run the model at the collected figure and treat the difference as the negotiation.
Add the buyer's living costs
A buyer draws a salary from the same collections that service the note. Subtract the owner draw before deciding whether the payment clears, because a lender subtracts it too.
When the number means it is time to talk to someone
- The payment clears on paper but the trailing collections came from an associate who is leaving with the seller
- The purchase includes real estate, which usually splits into two notes with two amortizations
- The seller wants a note for part of the price and the terms of that note are unsettled
- The practice sits in a state where ownership of the entity is restricted, which changes who signs
- Collections dropped in any of the last 4 quarters and the reason is not documented
The figures behind the model
| What it measures | Market range | Confidence | How to read it |
|---|---|---|---|
| Collections coverage test | About 60% practice cash flow, 40% buyer personal strength3 | DirectionalAugust 2026 | The share of collections a note commonly consumes before an underwriter treats the price as stretched. |
| Debt service coverage floor | 1.15x minimum on SBA 7(a) credit, measured on the borrower's operating cash flow4 | DirectionalAugust 2026 | The coverage ratio a conventional acquisition lender commonly holds to. |
| Acquisition credit profile | 650 floor, 680 and above for premium pricing, 640 at Live Oak for new graduates5 | DirectionalAugust 2026 | The personal credit band acquisition lenders commonly look for on a first purchase. |
| Time to close | Specialty lenders 30 to 60 days, SBA 45 to 90 days, banks 30 to 45 days5 | DirectionalAugust 2026 | The span between a signed letter of intent and funding on a typical practice purchase. |
Keep the numbers
Email me this scenario
The page stays open either way. This sends a copy of the inputs you noted, so the numbers are in your inbox when you sit down with an accountant or a partner.
What owners ask about this calculator
01What rate should I put in the model?
Use a rate inside the published market range for the structure you are considering, then run the payment at the top of that range as well. A model built at the bottom of a range gives a payment nobody underwrites to. The range and its date sit on the acquisition program page.
02Does the payment include the working capital I need after closing?
Only if you add it to the financed amount. Most buyers need an operating cushion for payroll and supplies through the first collection cycle, and most acquisition structures allow that cushion inside the same note. Add it to the price field so the payment reflects it.
03How does a seller note change the result?
A seller note splits the price into two payments with different terms, and the second one commonly sits on standby for a period. Model the bank portion here, then add the seller payment separately, because coverage is measured against the total of both.
04Why does the model use collections instead of production?
Production is what was charged. Collections are what arrived. A note is serviced from money that arrived, so an underwriter reads the collections line on the trailing 12 months and treats a gap between the two as a collection problem to be priced.
05Is the output an offer?
No. It is arithmetic on inputs you chose. Practition Finance does not price files, issue terms, or present offers. A funding partner communicates every rate, fee, and condition directly after it reviews the file.
Sources
When the payment clears and the file is real, send the purchase details for team review