Solar power or energy provides homeowners with a lot of benefits that includes lower energy bills, better home value, among many. But despite any early investments you made towards your favorite kind of solar panels, there are financial options available. Though every option has its own benefits and drawbacks, they can still help you save a lot of money in the long run. In this guide, you will learn about the best financial solutions to finally bring solar panels in your house.
The Various Solar Financing Options Available in the Market
There are different financing options for solar panels available in the market. Though every one of them are unique, you can bring a solar panel to your house. Different financing options available in the market are as follows:
- Maximize Long-term Savings by Purchasing with Cash
When you pay for your solar panel using cash, it may be the most beneficial option in the long run. There are no interest payments in this option allowing you to save electricity bills from day one. After you immediately own the system, you are eligible for every tax credit and incentives. This enhances your ROI in the long run.
There are various benefits associated with it like:
- No Lease Payments
- You become eligible for tax credits and incentives
- Your property value enhances
- You start saving electricity from the start
- Overall cost is low due to lack of interest payments
The only downside to this option is that you must pay a great amount of money at once. People with low capital may not be able to afford paying in this manner.
- Own Your Solar Panel Using Loans
Solar loans are a popular way of purchasing solar panels around the world. They are a popular alternative to cash purchases and you can finance your purchase using monthly payments. You can acquire these loans from banks, solar financing companies, or other relevant places. With the help of this loan, you become an owner of the solar panel along with incentives and tax credits.
Some of the benefits associated with this option are as follows:
- You get ownership of the system
- You can enhance property value
- You have to pay fixed monthly payments
- Only a small investment is required for the system
- You become eligible for tax credits and incentives
Downsides to this option include the requirement for credit approval, it has a higher total cost compared to purchase through cash and the interest payments enhance the overall cost of the system.
- Solar Leases and Power Purchase Agreements
Both Power Purchase Agreements and solar leases can offer a different path to acquiring solar energy with little to no large investment. This is a favorite option among homeowners who cannot purchase using cash and cannot qualify for a loan. With the help of a solar lease, you rent the system from a solar panel company and must pay monthly.
Under a Power Purchase Agreement, you buy the electricity generated by the system per kWh. The rate is lower compared to a utility company that can lead to saving your electricity bills.
There are benefits associated with these options such as:
- Little to no advance cost
- Less electrical cost and predictable leases
- The solar company will take care of the system maintenance and repairs
- The best option for homeowners who don’t qualify for a loan or have the cash to pay.
But there are more disadvantages in this payment option such as little to no increase in property value, no tax credits or incentives, complications in selling home, you don’t own the solar panel system.
- DIY Installation using Solar Panel kits
People who have relevant skills to do things manually can try the fourth option of DIY installation using solar panel kits. But for that, you also need to have a strong understanding of the various electrical systems. When you install the system yourself, you can reduce significant costs.
Some benefits associated with this option are as follows:
- There is potential of increased savings during installation.
- More control over the system and its installation.
- It can be a rewarding experience for those who like to do things themselves.
But there are several downsides of this finance option such as safety risks if the system is incorrectly installed, you require relevant permits and inspections before installation, and more. It also consumes a lot of time and is strenuous work.
Wrapping Up
If you want to buy solar panels for your resident but lack significant cash, it is essential to choose the relevant financing option. Making the right payment decision on Maryland Solar Panel installation can significantly impact your finances and the environment for the coming years. You must research all the available options before you come to a conclusion and think about the long-term. You can also opt to seek advice from professionals to understand the right option for you.