What is the best way to pay for this?
THIS SECTION WILL EXPLAIN SOME OPTIONS
How you pay for your solar system is usually the most important question. We are confident we can deliver an optimal solution.
Based on your circumstances, you must first establish your priorities using these questions:
1. How long do you expect to be in the house?
2. When will you be receiving the tax credits?
3. What is more important, a lower monthly payment or a shorter completion term?
Then we will help you choose from the following options:
1. Refinance your mortgage. Our partner includes the full system sales price not the "appraised value".
2. Solar Loan. This is very easy and efficient.
3. Home Equity Line of Credit.
4. Pay cash.
We will endeavor to expand on this section in the future, but essentially, the bottom line is this:
Every system we have ever sold was to a customer who made the right decision on how to pay for it. You will not be any different.
THE SOLAR LOAN
The solar loan is specially designed to finance your solar project. It features long terms, low APRs and the opportunity to use your tax credits for the lowest possible monthly payment. There is no lien on your property and there are no prepayment penalties. These are all attractive reasons for using solar financing over cash. But the BEST reason is the FLEXIBILITY this option offers as I will explain below.
Here is how it typically works:
Let's use an example of a $20,000 system, a $5,200 federal tax credit amount (26%), and an initial monthly payment of $200 (obviously a made up number but just go with me)
Once your system is installed, it is usually about 60 days before your first payment is due. You will then pay $200 a month for the next 17 months.
During that 17 months you will file your taxes and claim the federal tax credit - $5,200. If you make a voluntary contribution of that $5,200 towards the loan before the 17th payment, your 18th payment will stay at about $200 for the remainder of the term. Graphic
If you pocket that tax credit to use elsewhere - or pay less than the full 26% - the loan re-amortizes and your 18th payment will be higher than $200 for the remainder of the term. Say, $250 for example. Graphic
If you choose to pay more than the 26% (include your South Carolina tax credit for instance) - the loan re-amortizes and your 18th payment will be lower than $200 for the remainder of the term. Maybe $150 for example. Graphic
I'm willing to bet that those of you that really need some flexibility already see the key word in this example and are two steps ahead. The key word is voluntary.
Because of this structure and the voluntary nature of the 26% payment, the solar loan allows you to ask yourself some very valuable questions. Namely...
Is this the best use of my tax credits?
Do I have higher interest debt that I could pay down instead?
What about medical bills?
Elder care expenses?
Is it better to pay $x/ more for my electricity if it means no more car payments?
In the above example you could potentially receive $8,700 back at tax time (26% fed credit plus SC credit max of $3,500). You get to decide if it is better to lower your monthly electric bill or have a greater impact on your life elsewhere. And you don't have to make that decision until 16 months into owning the system.
This is why the solar loan is, by far, the most popular way to purchase a solar system.
We are partners with most of the major players and can offer pretty much anything you might read about elsewhere.