The Best Solar Financing Options
Despite the growing affordability of solar systems, many property owners, nowadays, wish to make this process as cost-effective as possible. Here, solar financing options are a useful way of eliminating the need to go over-budget for cash-strapped property owners.
In this regard, which options are the most appealing to prospective buyers?
Diving into the multiple solar financing options available in the country, our blog this week takes a look at the most lucrative solutions. Keep reading to find out!
A form of personal loan offered in certain institutions, customers who wish to purchase environmentally friendly solutions – including, in this context, solar panel systems – are eligible for this form of solar financing.
Enjoying lower interest rates and fewer startup fees, green loans are a fantastic option for those who can’t afford the upfront cost required by installers. Some institutions even restrict these loans specifically for solar products and to those with a good credit score.
While these are a hassle-free financing option, however, make sure you read the terms of your loan before you sign the dotted line.
Another practical option for those on the look for solar financing plans, personal loans are a popular remedy for many individuals.
With a little digging around, it’s possible to find a loan that doesn’t suffer from an excessive interest rate or one-off fees. While green loans may be more affordable than personal loans, the latter is far easier to secure approval for than the former.
Further, when it comes to green loans, certain institutions may demand that you have your panels sourced and ready before the sum is paid over to you. Personal loans, on the other hand, are pre-approved. This makes the purchase and installation process significantly more expedient.
Solar leasing is another popular way in which homeowners are coming to own solar panel systems.
Here, panels are supplied and installed with no upfront cost. Instead, the cost is paid off in fixed monthly instalments. Until all payments are complete, therefore, homeowners do not come to own their solar panel system – unlike in the case of personal or green loans.
While this seems more affordable, however, solar leasing comes with certain caveats.
Firstly, if you find yourself moving homes and are unable to take your panels with you, you’re still liable for the entirety of any unpaid cost. Further, interest rates for these schemes are also high, despite seeming highly affordable on a month-to-month basis.
Power purchase agreements
Here, an operator installs panels on your roof for free and you’re not required to pay the cost for this system. So, how does it work?
With power purchase agreements, property owners benefit from solar power and pay the operator a cost for the energy used at a rate lower than that exacted by the grid. In return for all of this, the operator retains ownership of the panels, despite installing them on your roof.
While this sounds immediately appealing, however, there are certain drawbacks to this form of solar financing. In essence, these kinds of agreements only prove fruitful if you’re allowed to use or store all the power generated by the panels. In reality, however, this is often not the case.
Adding solar financing to your existing mortgage
Another way of financing your renewable energy installation is by adding the total cost of the system – including purchase price and installation costs – to your existing mortgage.
This, however, is a little bit risky as you’re likely to repay this cost over a longer period of time than expected. Choosing this mode of solar financing, therefore, should be reserved for cases where every other option has been exhausted and you have a good understanding of how your finances are likely to play out.
If you’ve set your heart and mind on solar systems, it’s time to make your wallet catch up.
With the multitude of solar financing options available, affording these energy-efficient systems is now easier than ever.
Keen on finding out more of the best solar financing options?