The Dollar and Cents of Going Solar – Are You Ready?
If you are thinking about going solar, here are some things that you should consider before you do or do not get them installed. Solar power is a great choice, it can save you a lot of money, but you must ensure you are informed. Make sure you know these 6 questions you should ask before going solar.
Solar panels can lower a three-digit energy bill to under $10. This year, with a 30-percent federal tax credit on solar panels extended until the end of 2019, solar panel installation is especially popular. Let’s look at the cost-effectiveness of solar panels and highlight some critical questions that will help you make an informed decision.
The dollars and cents of going solar
A solar panel system for most residential homes will cost between $15,000 and $25,000, or $10,500 to $17,500 after the federal tax credit. Here are four ways you can pay for your solar panel system:
1. Cash.
Paying upfront will bring you the biggest return on your investment. Your solar panels will pay for themselves in five to seven years.
2. Lease agreement.
Solar leasing is available in about half the country. You’ll pay a monthly rent instead of an upfront fee for your panels. The leasing company will install them and collect any government credits or incentives on your behalf.
Leasing solar panels are generally not recommended, as they do not provide the lessee any lasting value. It usually contains an escalator clause, which increases lease payments by 3 percent a year. It can deter potential homebuyers if you decide to sell your house before the lease ends.
3. Solar loan.
These loans, created just for funding this purchase, can be secured or unsecured and have high origination fees.
4. Home Equity Line of Credit (HELOC).
Except for cash, the most financially responsible way to finance your solar panel purchase is through a line of credit against your home’s value. Stop by Elevate Credit Union to learn about the low-interest rates on our home equity line of credit; find out more here.
Are solar panels for you?
Ask yourself these questions before making a decision:
A. Which way does my roof slant?
In the United States, south-facing roofs are the best recipients of solar energy.
B. How much sunlight does my roof get each day?
Sunshine should hit your panels for a minimum of five hours a day.
C. How large is my roof?
An average residential solar system will need roughly 500 square feet of roof space.
D. How old is my roof?
Installing your panels on a roof with many years of life left makes sense.
E. How expensive is my electricity?
The higher your local electricity rates, the more cost-effective your solar panels will be.
F. Are there government incentives in my state?
Check for available state credits on the database of state incentives for renewables and efficiency.
Now that you know the 6 questions you should ask before going solar, make sure you contract with a quality company. And if you have decided to go solar and need financing, Elevate is here for you. Don’t forget to stop by one of our locations to ask about our financing options or learn more about a Home Equity Line of Credit.
