The Power of Choice: Loan, Lease, and Purchase
Sep 28, 2016
by EmPower Solar
In our last blog we took some time to dig a little deeper into our recent video, The Power of Choice and what exactly that phrase means. We discussed the key differentiators that set us apart from the competition, including transparency, amazing products and customer service, and the ability to choose how you go solar, whether it be leasing, financing, or purchasing your system.
Now, let’s go into a bit more detail and spend some time breaking down and discovering the benefits of each payment option. The goal is to determine what’s best for you!
Purchase as Investment
Roughly 10% of our clients purchased solar using cash, and view their solar system as an investment vehicle with an annual return of 15-20% per year. For consumers with an investor mentality, this is superior in comparison to most other safe investment options, and has a favorable risk/reward ratio. If you choose to use cash to go solar, you receive all the benefits of the state and federal tax credits along with a comprehensive 25 year warranty. Essentially, you go solar on your terms and maximize financial returns.
Solar Loan and Solar Lease
Solar leasing or financing are the two most popular ways to go solar. For most consumers, a loan makes greater sense when they plan to be in their home for a long time, however, a lease is a great benefit to homeowners with little-to-no tax appetite, or who simply don’t want to commit to owning the system. It’s important to note that there are a number of ways to finance your solar system, including loan products we offer, home equity lines of credit, personal loans, etc. We will explain the nuanced differences in future posts, like this one about SunPower solar leases vs solar PPAs.
The handy infographic below gives you a side by side view of the benefits of our lease and loan products.
Which is best for you?
The solar lease tends to generate more savings over the first 10 years. By year 15 things start to even out and eventually, the loan outperforms the lease. While both options can be zero out-of-pocket, you’ll see immediate savings and more over time with a solar loan, especially once the term ends and your electricity is, essentially, free.
While both options are excellent ways to save with solar right away, the final decision tends to be based on qualification and time horizon of the homeowner.
Our Solar Professionals (aka our Solar Educators!) are standing by to help you select your best option and lock you into the lowest energy cost possible with the best solar on the planet. You can rest easy knowing you’ve done your research and we’ve done our homework.
Get started today to find out how much you could be saving.