Solar is a smart investment, which you probably already know. However, you’re probably on this page because you’re curious to know about your different solar financing options. Well, you’ve come to the right place. Here at A.M. Sun Solar, we excel in coming up with financing solutions that make sense for our clients. All of our solar financing options prioritize one thing in particular: how can we start saving you money right away?
When it comes to purchasing solar, you can buy, lease, or purchase solar power from a system. Each option has its benefits and will vary depending on: equipment, location of the solar array, the size of your electric bill, and much more.
Here are the different solar financing options you have available with A.M. Sun Solar:
Buying Solar with Cash
When paying with cash, you can expect:
- High return on investment
- Quick payback period
- Increases the value of your property without increasing your property taxes
- Receive a federal tax credit (*check with your financial advisor)
- Costs far less than you would pay for electricity over the lifetime of the system
If you have the money to invest in your solar energy system and can use the federal tax credit, we recommend paying cash for your system – or getting a loan through one of our sources or one of your own.
Paying for Solar with a Loan
When paying for a solar energy system with a loan, you can expect:
- No money out of pocket
- Typically you’ll have instant savings – paying less than your utility bill
- No prepayment penalty. Pay off your loan any time!
- High rate of return once the system is paid in full
- Receive a 26% federal tax credit. Check with your financial adviser.
- Re-amortize your loan using the Federal tax credit to further reduce your monthly payment
Many times, you can secure a loan that is lower than your monthly utility expenses. No need for you to worry about all the options, our experts will help you choose the right loan for you. We have a variety of loans from many different sources.
Paying for solar with a Solar Energy PPA/Lease
PPA Stands for Power Purchase Agreement. Here’s what to expect when purchasing with a PPA/Lease:
- $0 out of pocket expense
- Pay less for your power
- No longer worry about the rising cost of electricity
- System is warrantied, maintained, monitored, and insured at no expense to you
When you choose a PPA/lease you will be purchasing power produced by solar equipment that is owned by a third party and has been installed on your roof, or elsewhere on your property. You will still be dependent on PG&E, but you will be buying your power at a lesser rate by going solar. Since you won’t own the equipment, it will be warrantied, maintained, monitored, and insured by a third party. In addition, the production of the system will be guaranteed for the term of the agreement, which is typically 20 years. This means you don’t need to worry about anything, including the ever-increasing cost of electricity!
Paying for Solar with a PACE Loan
PACE stands for Property Assessed Clean Energy. This means you can get a solar loan regardless of your credit score and regardless of your debt to income ratio.
Here’s what to expect when paying for solar through a PACE Loan:
- $0 out of pocket expense
- Easiest solar loan to qualify for
- Payment becomes part of your property tax bill
- No prepayment penalties
- Re-amortize your loan as often as you like with as little as $2,500 each time
- Up to 30-year terms
- Most PACE loans are cash-flow positive
- Receive the 26% federal tax credit and either keep it, or re-amortize your loan in order to reduce your monthly payments
- Deduct the interest on the loan for an even greater savings
You’ll need equity in your home and you’ll need to be current on your property taxes to qualify for a PACE Loan, but otherwise, the stipulations are fairly lenient. The beauty of this loan is when it comes time to sell your home, the solar and the loan stay with the house.
Where to get started?
Now that you are aware of your options for financing your solar energy system, the next step is to decide which option is right for you. That’s where we come in — as your local solar experts, A.M. Sun Solar strives to find a plan that works for you. Connect with us today to get started!