Solar Financing for Residential Solar Projects 0

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Today, residential solar financing options make it possible to purchase a solar photovoltaic system without the burden of its upfront cost. So, if you’re still hesitant to purchase your solar PV system for your property, you can opt for solar financing options. There are many solar financing companies that offer different solar financing options. With that, investing in a solar PV system is indeed worth it. Not to mention that the cost of the entire system is dropping almost every year. 

In today’s article, we will discuss the solar financing options for residential solar and some of the solar financing companies.  

What is Residential Solar Financing Option?

Solar financing is offered by financial institutions to aid homeowners who want to purchase a solar PV system but don’t have in-cash money to pay for it. Instead of paying the upfront cost of your solar PV system in cash, you can now rely on different residential solar financing options such as solar loans and solar lease/power purchase agreements.

Solar Loan

If you don’t prefer or are incapable of paying the upfront cost of your solar power system in cash, a solar loan is one of the alternative options to opt for. A solar loan option typically provides homeowners with money to pay the system as well as its installation process. The main advantage of a solar loan is that it gives borrowers flexible time and helps them avoid the upfront cost of purchasing an entire solar PV system. Besides, if you get a solar PV system by solar loan method, you can also enjoy the benefits of the federal solar investment tax credit. You can use the credit to lessen the monthly payment for your loans after the installation.

You can also take advantage of the low-interest residential solar project loan programs that are being offered by some states and local governments. 

Solar Leases and PPAs

If you choose the solar lease, you should be aware of the contract and arrangement since it’s one of the requirements needed to pay for the solar PV system. Generally, you have to pay it on schedule, every month. The solar lease term lasts up to 20 years. In a solar lease, the solar company will provide you with a solar PV system but they retain the ownership of the panels, so they can cash in on the solar tax credit. 

On the other hand, PPAs are being offered by solar financing companies, wherein they shoulder the expenses for the entire system as well as its installations and maintenance. All you need to do is to pay a monthly bill for the electricity generated by the installed solar PV system. What’s good about PPA is the rates for per-kilowatt-hour are cheaper compared to the traditional electricity bill. 

Solar Financing Companies

There are many types of residential solar financing options that every homeowner can opt for, but we will only cover here the solar financing companies that offer solar loans. We have compiled here some of the best solar financing companies, just in case you need assistance to finance your residential solar PV system. 


Financing Offers: Solar loans

Loan Range: $10,000 to $100,000

When it comes to solar financing, Mosaic is one of the best-chosen financing companies in the U.S. They provide residential homeowners across the U.S with solar loans up to 100,000. The company has a large network of solar developers, contractors and installers that they worked with. You can always reach out to them if you are in need of solar loans for your residential solar projects. 

Mosaic offers loans ranging from $10,000 to $100,000 to every qualified homeowner. Typically, you have to pay for the loan for 10 to 20 years. For the interest rate, Mosaic only asks for an average interest rate of 2.49%. However, the interest rates vary from lender to lender. Whereas, you should have at least 640 credit scores to approve your solar loans. 

Sunlight Financial

Offers: Solar loans

Loan Range: $10,000 to $70,000

Sunlight Financial is also one of the largest direct solar financing loans provider. They have a wide network of solar developers and installers. Based on the current record, they already managed to provide more than $4 billion of finances. Until now, the financing operation of Sunlight Financial is still ongoing, assisting every residential owner in all over the 50 states. Aside from the solar PV system, they also offer loans for solar battery systems and other solar roof replacements. 

In terms of interest rates, they usually offer zero to low-interest-rate loans only. You are also free to choose what type of loan you will get. You may opt for a 12-year loan (0% interest rates), a 15-year loan (1.49% interest rates), or a 20-year loan with 0.49% interest rates. For you to get qualified, your credit score must fall between 650 and 699, with a ratio of 55% on your debt to income.

LightStream Financial

Financing Offers: Solar loans 

Loan Range: $5,000 to $100,000

LightStream Financial is a division of SunTrust bank that offers a residential solar loan across the 50 states, without providing you with a solar PV system unit or any warranty for the equipment, unlike other solar financing companies. For you to be qualified with the solar loans you must have at least a minimum credit score of 660. The loan terms are ranging between 2 to 12 years, depending on the amount you will lend from them. The higher your loan the longer its payment period. LightStream loan interest rates range from around 4.99% to 16.99% and there are no hidden charges, penalties for prepayment and home equity loan requirements. 

It’s easy to get approved in the loan and funding in the company. However, LightStream is not disclosing its minimum income requirement, which makes it quite difficult for potential solar lenders to know if they can be qualified.


Offers: Solar Lease/PPA’s, Solar loans

Loan Range: (not disclosed)

Sunrun is a leading solar financing company offering secured solar finances to every homeowner at a low fixed interest rate. Sunrun solar loan is called the Sunrun BrightAdvantage provides no upfront payment and no penalties for delayed solar loans payment, plus you can take advantage of solar tax credits and other solar rebates while owning a system. 

Generally, Sunrun allows its potential lenders to purchase solar equipment through their bank partners. Their monthly solar loan process is straightforward with easy approval. You can also get solar incentives, solar rebates, and sales and property tax exemptions right after you purchased your solar PV System.


Offers: Solar loans

Loan Range: $45,000 to $100,000

GoodLeap or formally known as Loanpal is also an independent lending company that offers solar financial options at a fixed interest rate. The loan covers the solar installations as well as the installation of solar batteries. They also cover other energy-efficient home upgrades aside from the solar PV system. The solar financing company provides solar loans up to $100,000 with terms between 7 to 25 years. 

Whereas their APR rates are offered at the lowest rate of 1.99%. The loan that you can get solely depends on your credit score. For credit scores between 600 and 649, you can qualify for up to $45,000 while scores between 650 and 699 can receive a $50,000 solar loan. Any FICO above 700 can qualify for loans up to $100,000.

How to Choose The Right Residential Solar Financing Option?

If you are interested in residential solar financing options or looking for the right solar loans provider we recommend finding the best solar installer first since most of these installers and contractors are partnered with many solar financing companies in your area. You may get quotes from several local solar companies or look for solar marketplaces like us to find the right solar financing for your needs. Solar financing also has several options. You may choose the solar loan which is the most common one when it comes to residential owners, or you may opt for solar lease and PPA providers. 

We’re looking forward to seeing you find the right solar financing company that meets your needs. 

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