Installing a solar panel system on your home is an excellent way to reduce your dependence on electric or gas energy and decrease your carbon footprint at the same time. Although the cost of a solar system has come down quite a bit since they were first introduced a few decades ago, you're still looking at paying anywhere from $10,000 to $38,000 to install one, depending on where you live and the amount of energy you want the system to generate. Here are two ways you can finance your solar panel purchase if you currently don't have the cash to pay for it.
Solar Leasing
One way you can enjoy the benefits of harvesting solar power without the upfront and maintenance costs is to lease a system from a local provider. The provider installs the panels on your home, and you just pay for the energy generated from it. This option offers the best of both worlds: you pay less per month for your energy usage and the company handles repairs and maintenance of the system. Some companies even have a rent-to-own scheme where a portion of your monthly payments go towards the purchase of the system.
Although the upsides are very attractive, the major downside is that you don't own the equipment, despite all the money you paid. If you have the panels removed, you may also have to spend some money patching the holes in your roof where the panels were connected. And even though solar panels can increase the market value of your home, you may not experience this because the panels are rented rather than owned.
Local PACE Program
You can always take out a home equity loan to finance the purchase of your solar panel system. If you don't have much equity in your house, though, an alternative option is to submit an application for financing through the PACE (Property Assessed Clean Energy) program.
Typically administered by local or state governments, the PACE program loan homeowners money to make energy efficient upgrades to their houses. The primary benefit of this program is that it's typically repaid through a slight property tax increase, and sometimes the increase is attached to the property itself so the loan doesn't have to be repaid when the home is sold; future owners of the home would be responsible for continuing to pay on the loan. As you can imagine, though, this can make it a little more challenging to sell the house.
At the current time, PACE is only available in 29 states plus Washington D.C., though it may be expanded to other states in the future. To learn more about this program, contact your local housing development agency.
For more ideas on financing your solar panel purchase, contact a local solar system contractor, such as with Solar Source.
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