How to finance your residential solar system

Most homeowners think that they will have to pay for their residential solar system up front, and until recently that was the case. Now homeowners have lots of options as banks and credit unions are opening up to solar and loaning money to get those panels. 

Solar shoppers who don’t have thousands of dollars lying around can still get the solar system they want with the increasing popularity of the solar loan.

In the last few years, the number of banks, credit unions, and even utilities that offer solar loans has grown tremendously.

It used to be hard to get a loan to cover solar panels but now many different types of institutions offer them. Traditional banks and credit unions jumped into the market, and now even utilities are offering low-interest loans for solar panels. Some utilities are offering no interest loans.
 

Solar loans are similar to other home equity loans

Solar loans have the same basic structure terms and conditions as other home improvement loans. Credit scores, collateral, and proving the ability to pay back the loan are still paramount to securing the money, but most banks know that installing solar on homes will increase the value right away, so they are more willing to loan out the money for these projects.

Solar panel loans are similar to home improvement loans that homeowners have used for decades to build a deck or add a second bathroom. When a homeowner borrows money from a lender, they agree to pay it back, plus interest, in monthly installments over the loan term. Some banks have different lengths and interest rates available to homeowners, so it is a good idea to shop around for the right deal for your situation.
 

What is a home equity loan? 

Every bank and credit union has a version of the home equity loan. It is a great way to use the home itself as collateral to procure a loan to install solar. Installing solar increases the value of the home, and every bank knows this. If you have good to great credit, and you don’t have a lot of credit card debt, most banks will give very favorable rates and terms for these loans and explore what your bank can do for you is a great option.

There are also many solar power finance companies. All they do is work with homeowners to get solar loans for their homes. Companies like GreenSky Finance or Ygreen are more than willing to look at your situation and see if a solar loan is right for you. The great thing about the solar loan is many times the payments are less than what you would have paid for power from the utility anyway.

If you want to move into the future and join the solar revolution, or if you want to find out what solar panels are right for you, go to HahaSmart.com and try our price checker tool. You can see how much a system will cost, and how much you can save over the next 20 years.

For more information relating to going solar, don't forget to visit our solar blog section for more handy guides and articles.