Solar Loans: All You Need To Know For An Upgrade!

Solar Loans: All You Need To Know For An Upgrade!

Key Takeaways

  • Solar energy is a renewable and clean energy source still in its infancy and relatively expensive to install for residential purposes, so residents often take out a loan.
  • A solar financing is a wise decision because it offers long-term savings.
  • Texas offers government-backed tax credits and rebates for solar homeowners.
  • To qualify for a solar loan, you need to have a favorable credit score, browse solar lenders, and understand the requirements and terms of the loan agreement.
  • iRoofers Of America, serving Watauga, TX, can help you finance your solar upgrade.

Solar energy is the rightful poster child of renewable & clean energy globally, and it is still in its infancy as a technology. So, it should not come as a surprise that it is still a relatively expensive investment and takes meticulous planning & auditing to install for residential purposes.

So, are you planning to go solar in Watauga, TX? Do you require a fresher to get your residence up to a financing code for a solar upgrade? iRoofers Of America is your best bet on securing adequate financing for the switch from the grid to the sun!

Why Bother With A Solar Loan?

Switching from the grid to an all-solar system calls for some hefty spending that can be too exhaustive on a customer’s bank balance. Hence, the better alternative is to seek solar loans or solar financing. After the initial investment goes into the procuring & installation of required equipment, the only bills you are obligated to pay are the electricity used beyond the solar power generated. That alone is enough to recoup costs.

How Much Does Upgrading To Solar Cost In Texas?

Texas’s average cost of upgrading to solar is between $17,760 and $23,823. This cost will differ depending on the size of your home, how much power you use, the quality of equipment you install, and the estate you live in. The good news is that solar rebates and tax credits are available to help offset the cost of upgrading to solar.

Solar Loan – Is it A Wise Decision?

The solar loan is very similar to other loans offered by credit unions & renowned banks across the state. You can even choose your loan term & customize your interest rates & monthly payments. And unlike a home equity line of credit or loan secured by your home, you can also opt for an unsecured solar loan.

The advantage of an unsecured loan lies in the fact that your house is not tied to the loan in the event you default. Otherwise, you could lose your home with a secured loan. So, suppose you do manage to pay off the loan, you are still geared to reap the benefits of your solar system in the long term. The investment is solid.

Does Watauga, TX, Offer Incentives For Solar Homeowners?

Unless you are a Texas resident, it might be a shock that electric bills here are nearly 20% higher than the national utility average. And while that does put a pin in your plans to go solar in Watauga, TX, you can still avail of the tax credits & rebates in Texas.

For a solar installation, you are entitled to a 26% tax credit if your system was installed after 2017 and will be installed before 2022 ends – further tax credits will apply till 2035 solar installations. You can also qualify for the tax rebate program that will compensate you between $2500 and $8500 based on your solar installation size, output, and income.

It’s a pretty good deal for long-term savings if you think of it.

How To Qualify For A Solar Loan?

#1: Secured Or Unsecured?

You need to decide whether you can afford the risk of a secured loan or if an unsecured loan is an easy way out. Secured loans are treated as home equity loans, and you can customize your payback plan, so that is all well. But if you default & exit the grace period, you will lose your home.

If you opt for an unsecured loan, you will have to pay a higher premium and have fewer years to repay the loan. The only win is that if you default, your home is still yours to keep.

Evaluate your finances, income, & credit ratings, and then proceed with a loan.

#2: Browse Solar Lenders

You can find many solar lenders at establishments like credit unions, banks, utility providers, private solar financers, state programs, and solar developers like us. Make sure to get all the lender’s particulars in print & verified by local sources before proceeding for a consult.

#3: Loan Requirements & Terms

Even though the point of investing in solar is to save on utility bills & reduce the carbon footprint, there are still requirements to fulfill to fund your solar project. You may also have to familiarize yourself with certain terms.

  • The applicant must have a favorable credit score above 680, which is still higher than a conventional loan. And while low-credit lenders tend to accept 600-650, they will have far more rigorous qualifying criteria.
  • Down payment can range from none to around $3000, but if you pay a higher sum, you can avail of a lower monthly payment but will have a shorter term to pay back the loan.
  • Solar leases & power agreements usually involve an escalation clause to factor in inflation. That helps to increase your payments under the high electricity rates of the relevant state.
  • The contract terms decide your payback period. It is generally around 5-20 years, enough time for your solar investment to break even and give returns.
  • Suppose you decide to sell your home before your solar loan is paid off; you have to understand the requirements that make it possible for your loan to be transferred to the buyer.

#4: Weigh Savings & Costs

In an ideal solar loan contract, your monthly payments should be lower than the amount you save on utility bills when using solar. If that is not happening, you might have to pay out of pocket to get through the loan quickly, or you can make a bigger down payment to recoup positive cash flow.

Related: Rising Energy Prices – Why The Right Time For Solar Installation Is Now?

How Soon Can The Costs Be Recouped?

It takes a while before costs are positively recouped. Suppose your solar installation is worth $16,000, and you are saving up to $2000 annually via solar; at that rate, you can be projected to recoup costs within 8 years.

Don’t confuse this with a solar breakeven, as that can take more time to mature. It also depends on the high utility prices because that means you are saving more on solar. So, provided you are making significant savings in a high-priced utility zone, you can expect a breakeven in 15-25 years – and it is a very comfortable number considering the savings involved.

Solar Loans: All You Need To Know For An Upgrade!

Where Can I Get A Loan For A Residential Solar Upgrade?

While there are many options, from public to private & government-backed loans, you can also secure solar financing via iRoofers Of America, serving Watauga, TX.

We also offer solar installation, residential roof repairs, replacement & reinforcement. With us on your side, you can expect positive returns on your solar investment.

So, get ready and contact us for a free consultation.

201-584-3810

Call Us Today!

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