Solar City
San Mateo based Solar City has announced a loan program to offer consumers the opportunity to buy their solar panels instead of just leasing them from the company. So, we took a close look at the program and here are the Top 4 benefits of using a loan to buy Solar panels:
No Upfront Cost: Using a loan to buy your Solar panels means that the you will not have to pay $9,000 to $15,000 for purchase and installation of the Solar panels. The just have to make payments on the loan which is secured by the property.
Tax Credit goes to consumer: With the lease option, the Federal Tax credit for Solar panel installation was going to installer or the Solar companies. With the purchase option, this tax credit goes directly to the consumer who can use it to pay down the loan.
Loan Terms: Solar City loans offers as 30 year loans with 4.5% interest rate which are not that high considering that they will recorded as 2nd liens. But customers do not pay a fixed amount every month. In fact, the you will pay only for the power the your roof panels produce. If the panels produce a lot of energy the loan can be eliminated sooner than the 30 year terms.
Simple Terms: Purchasing your Solar panels with a loan is a much simpler contract for most consumers to understand. In fact, they are already used to gettig these kind of loans for buying a car or a large home appliance.
So, the question to ponder now is whether you want to own your Solar panels or just lease them. The question which remains unanswered is that how effective these panels will be after 20 or 30 years on your roof. Will they still produce enough power so you don’t have an electric bill? In our own investigation for our Los Gatos home we determined that spending close to $15,000 to eliminate a $110 per month of electric bill was not justifiable.
What do you think? Contact Us if your conclusions were different than ours about installing Solar panel in Los Gatos.