It’s a Solar Loan right for me?
If you are a homeowner and you are thinking about purchasing and getting a Solar panels system installed in your house and are trying to figure it out how to pay for it?
Financing help might be available to you!
You might be thinking: “Financing sounds great, but I don’t want to have a Solar Loan on my credit for so many years!”
Everything is just a matter of perspective, and in the financial world there are Bad Debts and Good Debts.
Solar Energy is considered a good debt and an investment that will grow in value or generate long-term income for you.
For the last 40 years, the Solar Industry has been constantly evolving and improving both technology and cost-efficiency, and the latest trends in the numbers shows that solar powered homes in NEVADA and the rest of the USA have been increasing considerably in only the last 5 years!
There are 3 main factors playing around these Solar positive trends.
1) The main incentive is coming from the government and is known as the Federal Solar Tax Credit or ITC credit for Solar, which allows homeowners to deduct a percentage of the total cost of the purchase of a new residential Solar System.
This deduction allows for a 30% tax credit incentive.
The tax credit applies to residential adopters of solar technology. and it will be applied to anyone who installed their system since the beginning of 2022.
The 30% credit also applies to energy storage whether it is co-located or installed as standalone energy storage. This enables the retrofit of a battery to a solar array while taking advantage of the credit.
If the tax credit value exceeds taxes owed on the year, the credit can be rolled over to a following year.
2) People is being more aware of the positive and economic benefits that using Solar Energy brings to their personal economies while being able to contribute to a cleaner environment .
3) Financial programs are the main factor that has been contributing to the explosive adoption of Solar Power among homeowners. Right now there are different Solar financing programs available that had been created to help homeowners in affording the purchasing of a Solar System for their house.
Going back to 2013, Leasing Programs or PPAs (also known as Power Purchase Agreements) help homeowners to basically rent a Solar System with a low monthly payment and with this leasing model the solar installation company owned the solar system and simply sold the power to the homeowner at a lower rate than their current utility.
Solar leases or PPAs were a great option back in those days but compared to the Solar ownership program it has its disadvantages:.
Leases or PPAs are not able to take advantage of the Federal Incentive Tax Credit (ITC). Only those who purchased and own the system can receive that credit. This fact has led to a decline in leases and PPAs over the last years, and has caused a Solar Market shifting where now Homeowners are looking for an Solar Ownership Program instead, so they can rip the benefits of owning their own Solar system and with ownership comes another major benefit, added home equity!
There are options for those with low credit scores, those with some cash to put down, those who want to pay off their loan quickly, those who want greater immediate savings, etc.
Homeowners looking to buy a Solar System can apply to be qualified for a low interest financial option as long as their credit score requirements are met. Most Solar financial institutions require a minimum of 650 credit score or above and no previous Bankruptcies over the last 4 years to potentially get you qualified.
A solar loan is considered positive debt, because it allows you
to own an asset (Your Solar Panels),
that will generate significant savings, putting more money in your pocket.
When you are financing, the amount you want to pay each month will impact the interest rate and the length of the loan. Loans with longer terms will have smaller monthly payments, but you will pay more in interest over the life of the loan. In contrast, payments on solar energy loans with shorter terms may exceed your monthly utility bill savings, but they offer a better value because you pay less in interest over the life of the loan.
How do Solar Loans work?
The most popular Solar loans have a 12 to 25-year term, no pre-payment penalties, and interest rates of 2.99-4.99% depending on the length of the year term. Short-term loans have lower interest rates than long-term loans.
A typical 12 year loan may have an effective APR in the 2.99% range, while a 20 year loan will have rates closer to 3.99%.
Numbers are showing that the most attractive Solar loan option term for most homeowners is the longer term. It offers a homeowner a lower monthly payment because the more time the borrower has to pay down the principal balance of the loan this allows for smaller monthly payments, a feature many people find attractive.
Most Solar Loans don’t have a prepayment fee or penalties. and allow you to have a small monthly payment while
You can partially or fully pay your solar loan principal early and save the remainder of the future financing costs.
Like any other financial product, solar panel loans have different structures, terms, and conditions. In order to find the solar energy loan that is right for you
Without Cash to spend, some Homeowners are finding that financing a Solar System is a great way to get them in the path of energy freedom by owning a Solar System for their house.
Because with a Solar Loan low monthly payment you will be replacing your always increasing, never ending Electric utility bill with a never increasing, cheaper and low monthly solar payment.
For most Homeowners switching to Solar Power It Just Makes Sense!
Do you have any questions, concerns or inquiries about Solar Power?
Please feel free to Contact Us NOW and a Solar Advisor will get in touch with you ASAP.