Homeowner Tool
Solar Financing Comparison
Compare the general characteristics of common residential solar payment structures. This is educational; it is not a financing offer or tax determination.
Estimated completion: 4–6 min
Tax and financing
Tax eligibility and financing outcomes depend on individual circumstances. Confirm tax matters with a qualified tax professional and financing terms with the actual lender or provider.
Which concerns matter most to you?
| Consideration | Cash purchase | Solar loan | Lease | Power purchase agreement (PPA) |
|---|---|---|---|---|
| Who owns the system | Homeowner | Homeowner | Third party | Third party |
| Upfront cost | High | Low or none | Low or none | Low or none |
| Monthly obligation | None from financing | Monthly loan payment | Monthly lease payment | Payment per kWh produced |
| Potential interest / escalators | None | Interest applies; check dealer fees | May include escalator | May include escalator |
| Tax-credit considerations | Depends on individual tax situation | Depends on individual tax situation | Typically claimed by owner (third party) | Typically claimed by owner (third party) |
| Maintenance responsibility | Homeowner (per warranties) | Homeowner (per warranties) | Third party (per contract) | Third party (per contract) |
| Contract length | N/A | Typically 10–25 years | Typically 20–25 years | Typically 20–25 years |
| Home-sale transfer | Simplest | Depends on lender | Requires assumption or buyout | Requires assumption or buyout |
| Early payoff | N/A | Depends on lender terms | Depends on contract | Depends on contract |
| Ownership at end | Homeowner | Homeowner | Depends on contract | Depends on contract |
Questions to verify with the provider
- Is a dealer fee included in the financed price? What is the amount?
- Are there escalators? At what rate?
- How is the federal tax credit reflected in the contract, and who claims it?
- Are there prepayment penalties or fees?
- What lien or security interest is placed on the property?
- What are the specific transfer terms if the home is sold?
Confirm all financing and tax details using the actual provider documents and qualified professional advice.