Financing Solar Panels

To buy or to lease? That is the question—it's not just a question people need to answer regarding their next car. Many major purchases in life come with these options, and the best answer for you can vary with each decision. But what about your solar panels? Is it better to buy your solar power system outright or lease the equipment to start getting solar power to your home? Both choices have pros and cons, so keep reading to learn more about buying versus leasing solar panels. You can also contact The PowerStore, Inc., to find out more about our solar financing options.

Benefits of Buying

Buying your solar panels provides you with an asset that you own and the opportunity to rack up long-term savings. You'll pay less over the long term for your solar panels and, once your upfront installation cost is paid off, won't have any expenses associated with your solar power system until equipment needs to be replaced (which usually isn't for a decade or more, depending on the equipment).

Additionally, purchasing your solar power system makes you eligible for tax credits and rebates. When you buy a solar power system, you can deduct up to 26% of the system's total cost. Local governments may also offer additional incentives and tax credits, and manufacturers and distributors often provide rebates for those who buy their equipment outright.

In the long run, buying your panels and other equipment will result in a net gain. Generally speaking, a solar power system you purchase will pay for itself in energy savings over seven years, give or take. Additionally, if you sell your home, having a solar panel system already installed can increase your resale value.

Drawbacks of Buying

The upfront cost is the biggest and most obvious drawback of purchasing a solar power system. Financing options are available if you don't have the funds to buy a solar power system. However, keep in mind that this adds fees and interest to the total cost, so you'll need to determine whether purchasing your system using a financing plan is right for you.

Buying your solar panels can also be a poor choice if you plan to move in the next few years. As we stated above, it can take about seven years to earn back your investment on most systems, so if you're moving before then, you're likely walking away from the system at a loss on your investment; the increase on your home's resale value may or may not offset that loss.

Benefits of Leasing

On the other hand, leasing your panels involves very little upfront investment. You can get solar panels on your home and run your solar power system without spending money. This can be a great way to try out a solar power system to see if it fits your needs without making a huge investment.

Additionally, you don't have to worry about your system's maintenance and repair costs. Solar power systems are very low maintenance, so those who own their systems don't usually need to perform much maintenance. But you don't have to pay for the repairs while leasing the equipment if something goes wrong.

Drawbacks of Leasing

If you opt to lease your solar panels and other equipment, you'll lose out on the opportunity to receive lucrative deductions, rebates, and other cash incentives. Leased systems are not eligible for these benefits. Additionally, leasing a system will cost more in the long run. As we stated earlier, buying a system has little to no ongoing costs, so once you've earned back your investment, your savings are cash in your pocket. With a leased system, you'll continue to pay for your system every month throughout the life of the lease. Additionally, you will continue to have monthly energy expenses in the form of your lease agreement; whether or not this is less than you would have been paying on your regular utility bill will vary for every home.

If you're planning to move, you will need to end your lease for your system (and ending it early may come with extra fees), and the company that owns the equipment will come to remove it. This means that you won't get any boost to your home's resale value. Also, keep in mind that leased solar panels can complicate a real estate transaction, especially if the buyer has no interest in the system or if the company that owns the equipment is unwilling to transfer the contract to the new owner.

Which Is Best for You?

The answer to this question will depend largely on your needs and priorities. Buying a solar power system is best if you have the funds to invest upfront and you're looking for a long-term return on your investment. On the other hand, leasing your equipment may be the better choice if you don't have the upfront cash or want to try out solar power without making that initial investment. Many companies will allow you to lease your equipment with the option to buy it outright at the end of the agreement. While this typically costs more than purchasing the equipment upfront, it can be a great way to ease your way into owning and using your own solar power system.

If you still need to decide which option is right for you, contact us to learn more about The PowerStore, Inc., and ask us about our financing options for your solar power equipment. We carry equipment from all of the top manufacturers and work with professional installers all around the country to help homeowners like you find the best deal on installing a solar power system. Solar power should be affordable for everyone, so call now to learn more about your options and our products!