Solar Power Loans: Basics and Unique Qualities
For those who are interested in solar power system installation but don’t quite have the available funds to cover the costs up-front, there are several robust financing options available today. One of the best, and also among the newer options in this realm, is the solar power loan.
At Intermountain Wind & Solar, we’re happy to not only assist all customers with a variety of commercial and residential solar panel installation and future service, but also with financing and other important areas like tax incentives that make a big financial difference for those considering this move. This two-part blog series will focus on the solar power loan – what it is, why it’s generally preferable to solar leasing for many people, and how you can go about obtaining it for your upcoming solar panel installation.
Why Loans Over Leases
Both solar loans and leases allow you to obtain solar panel systems without paying full freight, but they operate in different ways. The primary difference here: A lease never allows you the benefits of actual ownership of the solar panel system, while a loan does.
For a solar power lease or rental situation, a third-party owner will actually own the system. This means that for tax rebates, credits and any other financial incentives that come due to the system’s presence, this third party sees the benefits, not you. In addition, today’s solar panel loan programs are so robust that your potential savings are often far larger from a loan than from a lease over the life of the system – often as high as 70% of the entire system’s cost in reduced electrical bills, to be specific.
Similar to Other Loans
In many simple ways, solar power loans are similar to others you’d find for other loan types. The shorter the term of the loan in question, the higher the monthly payments tend to be, and vice versa. Solar panel loans, like home loans, can also be either secured or unsecured – the former is the more desirable area for those who qualify, and will come with lower interest rates and other perks. The latter is for those who do not have the credit score to qualify.
However, there’s once again a very important difference between a solar power loan and most other loan types, particularly car loans and home improvement loans: A solar panel loan is for ownership of an appreciating asset. Not only do solar panels generate electricity for you and save you major sums on your bill each month, they also bring you tax credits like the federal investment tax credit (TIC) and perhaps others. While you’re taking out a loan, you’re doing it toward an item that will build you financial value into the future.
For more on solar panel loans, or to learn about any of our solar panel installation or other services, speak to the staff at Intermountain Wind & Solar today.