Solar Financing For Homeowners

What Is Solar Financing?

Solar financing is the process of borrowing the funds necessary to purchase a solar panel system. Solar financing is a common strategy people use to make the switch to solar energy. Purchasing a solar system can cost between $15,000 and $30,000 depending the size of the system and the added features you choose to include. There are great solar panel financing options available that make solar energy more affordable for homeowners.

solar financing pays off in the end

When you choose to finance your solar panel installation you will end up paying interest over the money borrowed, but you still save money in the long run as the combination of cost and interest still out weigh the cost of your current energy bills. Having this long-term mindset is important when deciding how to finance your solar panel installation.

Financing companies are available to help you pay for your solar system, if you want help finding a solar financing company Belmont Solar can point you in the right direction. Contact us today for help with your solar financing decision. There are a number of great solar incentives in the form of tax credits and rebates that we will discuss in more detail as we go on.

Why Choose Solar Financing?

People often choose solar financing if they do not have the cash on hand to pay for the entire solar panel system upon installation (many people do not have $15,000 to $30,000 just sitting around). Choosing solar financing over solar leasing allows the buyer to fully own the solar panel system after the financing is over. It allows the buyer to take full advantage of all solar rebates, solar tax credits, and solar incentives available to them at the time of the purchase.

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People often choose solar financing if they do not have the cash on hand to pay for the entire solar panel system upon installation (many people do not have $15,000 to $30,000 just sitting around). Choosing solar financing over solar leasing allows the buyer to fully own the solar panel system after the financing is over. It allows the buyer to take full advantage of all solar rebates, solar tax credits, and solar incentives available to them at the time of the purchase.

Solar Financing Vs Solar Leasing

Solar Financing is a more recent option for homeowners wanting to buy a solar panel installation system. It used to be that either you paid for the entire system up front or you leased the system from the solar installation company.

There are pros and cons to both leasing and financing. Some of the notable pros to financing are:

  1. After the final loan payment is made, the homeowner owns the solar system.
  2. Financing the solar system instead of leasing it makes it easier to sell the home before the loan is paid off.
  3. Owning the solar system adds value to the property it is installed on.
  4. Financing means that the homeowner has access to all the rebates, tax credits, and other incentives available.
solar financing benefits

Your Best Solar Financing Options

Solar Financing Loans

You can take out a solar loan or an energy efficiency mortgage from the federal government to finance your solar system. SunRun offers solar loans in qualified areas and is helping normal, everyday people get into solar power with some great solar financing options.

Solar Financing With Fannie Mae

Fannie Mae and the U.S. Environmental Protection Agency offer home loans for solar systems through their Energy Star program. These are definitely good options to explore if you are thinking about financing a solar system installation.

Solar Financing With The PACE Program

PACE stands for Property-Assessed Clean Energy. PACE loans are authorized by local and state governments which borrow money to fund PACE programs by issuing a bond. The money is provided by different private financing companies. PACE loans qualify as tax liens, so they have first priority over any other loan on the property, including the mortgage.

Solar Financing And Tax Credits

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There are also significant federal and local tax credits available for your new solar system. The federal tax credit, which was extended to last through the end of 2022, will cover up to 30% of your investment in a solar system for your home. After 2022 a 10% tax credit will be available until it runs out.

Additional loans, grants, and rebates are available from state and local organizations, many of which can be found on the DSIRE website. There are all sorts of ways to offset the initial cost of a solar panel system that will make solar financing more feasible.

UnderstandSolar has written about some financial incentives, rebates, and tax credits for the Pennsylvania homeowner in their article Solar Panels in PA, as well as other useful information about solar options in Pennsylvania. We highly recommend you check out UnderstandSolar, they make a lot of these things very understandable (no pun intended) and will help you make the best decision possible.

Making Your Solar Financing Decision

There are a lot of things to consider when making such a large financial decision like purchasing a solar panel system. The great news is that there are excellent options for people who are not in a position to pay cash for a brand new solar system. Solar financing can help you make the transition to clean, renewable energy. Most systems are completely paid for within the first 12 years after installation (and some are paid off much faster).

You don’t have to wait until the system is paid for before you start experiencing all the benefits of solar! If your system is grid tied and your utility company is capable of doing net metering (the process of measuring exactly how much excess power from a solar system is returned to the power grid) then you can begin getting solar renewable energy credits which is like your solar system helping to pay for itself.

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If you have an off grid system then you can begin enjoying freedom from the power grid and monthly electricity bills as your solar system generates the power you need.

The potential any solar panel system has to enhance your life is really remarkable. At Belmont Solar, we love to see our customers thriving and enjoying the many benefits solar power offers. If you have more questions or you’re ready to talk about solar financing or solar installation contact us today, we would love to talk to you.

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