SBA 7(a) Veterinary Clinic Feasibility Study in Michigan

Fewer cancellations, smaller checks

Veterinary clinics in Michigan received 73 loans under SBA 7(a), totalling $51.1 million in gross dollars; Michigan places 11th nationally for the pairing, and veterinary care is only the 17 of 39 class at home. Two metrics are distinctive. The first is cancellation: only 1.7% of approvals through FY2024 were cancelled at the floor, and 3.3% at the ceiling. The second is ticket size, where a $350,000 median is just 0.57x the national figure. The middle of the Michigan book runs from $110,600 to $981,000. Not one clinic is franchised (0.00%).

The Huntington National Bank holds 23 loans, and Live Oak Banking Company trails with 9. The page repeats what SBA's file says about present holders and nothing about how either bank decides. The county list is flat: Oakland has 10 loans, Genesee 6, Berrien 5, and Kent and Saint Clair 4 each, while Chippewa, Ingham, Iron, Kalamazoo and Montcalm have 3. Veterinary lending thus spreads across many small counties. Volume was 15 loans and $10.3 million in FY2018, collapsed to 2 loans in FY2019, and peaked again at 11 loans in FY2025.

The loss floors

Of the 40 loans in the funded FY2017 to FY2021 cohort, at least 2.5% have been charged off to date, whereas none had been written off by year five (0.00%). That means the charge-offs that exist came after the fifth year, which loans still open could add to. Cancellation is the strong point of the cell, and losses read as ordinary. A borrower should still weigh the long tail, since a clinic loan is repaid over many years.

What a Michigan veterinary study must prove

The study should start with the practice, not the building: client base, species mix, the number of veterinarians the revenue needs, and the difficulty of hiring and keeping them. If the clinic is bought, ask how much goodwill walks out with the seller. For a startup, it should show the ramp to a full appointment book. Equipment, surgical suites and imaging belong in an itemized budget, set against a small median ticket. Competition from nearby practices belongs in the model, and the model should carry a weaker-revenue year through debt service. The appraiser will want collections documented.