Comparison
Solar Loan vs Paying Cash
Dealer fees, interest, and the federal credit change the math on financed solar. Here is how to compare a loan against a cash purchase honestly.
The same system can carry two very different prices depending on how you pay. Financed quotes include a dealer fee that the installer pays the lender and passes to you inside the sticker price.
The dealer fee nobody mentions
Low advertised rates are subsidized by a dealer fee, commonly 15% to 30% of the system price. A $24,000 cash system can appear as $30,000 on a 2.99% loan. Always ask for the cash price and the financed price side by side.
The 18-month balloon assumption
Many solar loans are structured with a re-amortization point assuming you apply your federal tax credit as a lump-sum principal payment. If you do not, or if your tax liability is too small to use the whole credit, your payment jumps.
When financing still makes sense
If your loan payment is below your current electric bill and you keep the home long enough to reach payback, financing turns a capital project into cash-flow-positive month one. That is a real benefit. Just price it with eyes open.