What You Need To Know About Solar Financing

Are you wondering whether you should go solar? Besides saving money, you will use clean renewable energy. Solar is a long-term financial relief to people and families struggling with high unpredictable energy costs. In the U.S., there are over 1.5 million residential solar installations, and the number continues to rise each day. Solar installation can be expensive for many people to afford. Fortunately, there are many solar financing options that have enabled many Americans to enjoy the benefits of solar energy. Let’s take a quick look at how you can finance your solar project.

Taking out a loan

This is one of the most common ways people opt to finance their solar installation project. If you have good credit and a great rapport with your bank, this is one of the easiest ways you can access funds to finance your project.

The interest rate of your loan will depend on your credit rating. The type of loan can be;

  • Solar loan: This type of loan will provide money to pay for your solar installer. You can borrow up to the full cost of the solar system. The interest rates and repayment programs vary.
  • Personal loan: It’s not a must you get a specific type of loan like a solar loan. You can take out a personal loan and use the funds to pay for your solar installation. Personal loans give you access to more financing options.
  • Home equity loan: You can use your home equity to acquire a home equity loan. This type of loan gives you access to a set amount of funds once while a home equity line of credit sets the limit you can borrow.

A loan will help you pay for solar installation but you must remember you will be paying the loan for a period of time, but you’ll save on the electricity bill so that will be a definite benefit when making loan payments.

Solar Lease

In a solar lease or a power purchase agreement the solar panels remain owned by the company. Your solar installer can recommend leases. You get the solar panel you desire, and at the same time reduce your electricity bill. Keep in mind, because you don’t own the panels, valuable tax breaks or incentives may go to the company that owns the solar panels. Some lease contracts can be as long as 20 years.

Do it by yourself

If you have savings, you can use that to buy your solar system as solar energy will enable you to reduce your utility bills significantly. If you don’t already have savings, you can start a program to save up for your solar installation project. Talking to friends and family can also help as some can help you in funding your project.

When considering solar installation, it’s important to take time before settling on a solar financing option. Talk to family and friends, and do your research online and in person to settle for the option that best fits your lifestyle and ability. The initial installation cost of a solar system can be high, but, it will benefit you greatly in the long run. Installing a solar system is the first step to using environmentally friendly, sustainable, and cheaper energy.

Farryn Campbell is a mother of 3 wild boys and loves spending her time outdoors on her solar powered farm. She is also an avid spokesperson for reusing materials and enjoys helping out her community.

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