Unsure where to find a solar loan? Take a look at these top solar financing companies!
The easiest and most cost-effective way to get solar is to pay off your entire solar panel system in cash. However, this isn’t possible for many homeowners since solar systems can cost tens of thousands of dollars.
That’s where solar financing comes in. Financing options like solar loans let you gradually pay off your system in monthly payments. According to the U.S. Department of Energy, about 85% of residential solar systems in the U.S. are financed.
Many times, homeowners find financing through companies that specialize in solar loans. Finding the right financing company can be tricky, but we’re here to help.
With the help of hundreds of solar installers, we were able to narrow down six of the most popular solar financing companies:
- Mosaic
- Sunlight Financial
- Goodleap
- Dividend
- Energy Loan Network
- Lightstream Financial
Top 6 solar financing companies
These are the top financing companies used by solar installers, according to the responses from our 2022 Solar Industry Survey.
| Solar financing company | Better Business Bureau rating |
Customer reviews* (Out of 5 stars) |
|---|---|---|
| Mosaic | Not rated (NR) | 3.77/5 |
| Sunlight Financial | B+ | 4.6/5 |
| Goodleap | B+ | 3.96/5 |
| Dividend | B | 1.3/5 |
| Energy Loan Network (ELN) | A+ | 4.98/5 |
| Lightstream Financial | A+ | 1.33/5 |
*Customer reviews from the Better Business Bureau.
1.) Mosaic
Offers: Solar loans
Available in: All 50 states and Washington D.C.
BBB score: Not rated
Customer reviews: 3.77/5
About: Mosaic is one of the largest direct solar loan lenders in the U.S., funding more than $10 billion in loans for residential solar and other sustainable home improvements.
Mosaic has a huge network of solar contractors and installers they work with. So, if you’re interested in a loan, it’s likely that at least one installer you receive quotes from will offer Mosaic financing.
Solar loan: Mosaic loans range from $10,000 to $100,000, with terms typically between 10 and 25 years. You can choose between three financing structures with Mosaic called PowerSwitch. Interest rates vary, but in some cases, you can qualify for an interest rate as low as 3.99%. The company has been known to approve loans to those with credit scores as low as 640.
2.) Sunlight Financial
Offers: Solar loans
Available in: All 50 states and Washington D.C.
BBB score: B+
Customer reviews: 4.6/5
About: Sunlight Financial is also a direct lender of solar loans. Sunlight Financial has its own network of solar installers, with over 300,000 solar systems financed. But Sunlight doesn’t stop at solar – its loans can also help finance solar battery systems and roof replacements.
Solar loan: Sunlight Financial now offers zero and low-interest-rate loans for homeowners looking to go solar. Sunlight’s Q1 Earnings Presentation says its loans typically have loan terms of just over 20 years and interest rates of around 3.3%. However, interest rates have increased since the start of 2023, so Sunlight’s rates are likely higher now. Sunlight requires a minimum credit score of 650 to finance.
Sunlight Financial and Solar Insure have partnered up. Those who finance their residential solar system through Sunlight can now access Solar Insure’s 30-year monitoring and warranty service.
3.) GoodLeap
Offers: Solar loans
Available in: All 50 states and Washington D.C.
BBB score: B+
Customer reviews: 3.96/5
About: GoodLeap, formally known as Loanpal, is a direct lending company that provides fixed interest rate loans that cover solar installations and solar battery installation. GoodLeap can also cover a portion of other energy-efficient home upgrades (like smart thermostats and energy-efficient windows).
Solar loan: GoodLeap offers solar loans with terms between seven and 25 years. APR rates have been reported as low as 2.98%, and the loan you can qualify for depends on your credit score. FICO scores between 600 and 649 can be eligible for up to $45,000, and scores between 650 and 699 can qualify for $50,000. Any credit score above 700 can receive loans up to $100,000.
4.) Dividend
Offers: Solar loans
Available in: 45 states and Washington D.C. (unavailable in AK, MT, ND, SD, VT)
BBB score: B
Customer reviews: 1.3/5
About: Dividend offers financing options for residential solar systems, solar storage, and other home improvement projects. With over 700 solar installation businesses in their network, Dividend’s installers will create a quote for a solar system and attach a built-in financing option that installers will present to prospective solar customers.
Solar loan: Dividend’s solar financing option is the EmpowerLoan, a secured loan requiring no down payment. Homeowners can receive loans up to $120,000 and need a minimum credit score of 660 to finance. The exact interest rate varies by credit history and your installer, but rates are typically between 3.49% and 6.99% with Dividend. The EmpowerLoan is offered in 12 or 20-year terms and is secured against your solar system.
5.) Energy Loan Network (ELN)
Offers: Solar loans
Available in: All 50 states and Washington D.C.
BBB score: A+
Customer reviews: 4.98/5
How it works: Energy Loan Network is a specialized financing company that works primarily with credit unions to provide customers with funding for their home solar project. ELN is not a lender. The company operates a network that connects lenders to contractors that sell and install residential solar systems. Lenders often give special rates to customers who work with ELN to secure financing. The company also offers home improvement loans for energy-efficient projects such as HVAC replacement, insulation, and more.
Solar loan: ELN’s solar financing partners typically offer fixed interest rates averaging 5.24%, but this may vary depending on your credit score, the installer you use, and the lender. The loans have payback periods that range from 8 to 20 years. Applications for this loan are accepted through their website 24/7. There is currently no listed minimum credit score required to finance, but it will likely align with other lenders' minimum requirements.
6.) LightStream Financial
Offers: Solar loans
Available in: All 50 states and Washington D.C.
BBB score: A+
Customer reviews: 1.33/5
About: Lightstream Financial is a division of Truist Bank, functioning as an online consumer lender for just about any financing project — from home improvement to auto. Its loans range from $5,000 to $100,000, depending on the project you need funding for.
Solar loan: To qualify for LightStream Financial’s home improvement solar loan, you must have a minimum credit score of 660. Loan terms range between 2 and 12 years, depending on the loan amount and what works best for you. Interest rates range from 7.99% to 21.24%. There are no fees, prepayment penalties, or home equity loan requirements. So, if this interest rate seems high, just know there are no additional fees behind it.
What is a solar loan?
Solar loans are the most popular way to go solar. Borrowers can secure a loan from solar financing companies, typically via their solar installer, that covers the amount needed for a home solar system.
Solar loans are structured pretty similarly to any other type of loan but have a few key features you should be aware of, including:
- Dealer fees
- Interest rates
- Term lengths
- Balloon payments
- Down payments
- Monthly payments
Financing solar usually starts with some type of application process. Once the borrowed amount is finalized, you’ll have a monthly payment to the financing company. The monthly payment will comprise of principal and interest, as well as additional fees. You can pay through a checking account or credit card, typically via online banking.
Solar loans typically have interest rates of around 6% but vary quite a bit depending on your FICO credit score, the installer you choose, and any dealer fees involved. The term length of your loan also determines your monthly payment. Most solar loans range between 15 to 20 years to pay back, but 25-year loans are becoming increasingly common.
Learn more: Solar loans: Everything you need to know
Solar tax credit and solar loans. The federal solar tax credit is the most popular solar incentive available today. Most solar loans require you to pay the value of your tax credit to the financing company no later than 18 months after you start loan payments. If you don’t pay the value of your 30% tax credit, your loan payments will increase after 18 months.
What other solar financing options are available?
Other solar financing options exist if you can’t pay in cash or take out a loan.
These are called solar leases and power purchase agreements (PPAs). With solar leases and PPAs, you don’t have to pay any upfront costs. Instead, a solar developer owns the system on your roof, and you submit a monthly payment to them for using the energy the solar panels create. The solar payment is usually cheaper than your monthly electric bill without solar.
For solar leases and PPAs, most incentives and rebates, such as the 30% federal tax credit, are entitled to your solar developer, not you.
Going solar with a lease or a PPA does save you money upfront, but they usually result in lower long-term savings than if you purchased the system with cash or a loan.
Popular solar lease and PPA companies: SunPower and Sunrun
If you’re curious about solar leases and PPAs, you’ll probably want to look at SunPower and Sunrun.
Sunrun is considered one of the pioneers in third-party-owned solar systems. Its PPA and lease offerings include a full-coverage warranty and no money down on solar systems. When leasing through Sunrun, you are given a performance guarantee that your solar system will never operate below 95% of the estimated energy output. If your panels produce below 95%, Sunrun will refund you the difference. The average cost of financing through Sunrun is $4.50 per watt.
SunPower third-party-owned systems also have a production guarantee that varies depending on your system. SunPower’s responsibility to your system includes maintenance, insurance, and monitoring. The average cost of financing through SunPower is $4.89 per watt, but it uses premium-level products and often comes with better customer service than Sunrun.
Comparing solar financing options
| Solar loan | Solar lease | Solar PPA | |
|---|---|---|---|
| Benefits | Purchase system with zero upfront costs | Zero upfront costs | Zero upfront costs |
| System owner? | Yes | No | No |
|
Receives tax credits/SRECs |
Yes |
No | No |
| Uses net metering | Yes | Yes | Yes |
| Responsible for maintenance? |
Homeowner | Solar installer | Solar installer |
| Monthly payment |
Fixed-rate, may change after 18 months depending on loan terms. | Fixed with annual price escalator | Varies depending on solar energy production, includes an escalator |
Solar loans are the best option for most homeowners. However, rising interest rates and dealer fees make loans way more expensive, making solar leases and PPAs look more attractive to homeowners than they have in the recent past. In general, though, you can still get a better return on your investment by using a solar loan.
Solar leases and PPAs are the best choice if you want to go solar, but you can’t qualify for a loan or the federal tax credit. Maybe your credit score isn’t great, or you don’t have taxable income. A lease or a PPA can be the best choice in either of these scenarios.
You can also seek personal loans, like a home equity line of credit, to pay for your solar system. Depending on your finances, you could get a lower interest rate than you could through a solar loan provider, and you wouldn’t have to worry about dealer fees. However, personal loans come with their own rules, so make sure you understand all the costs and benefits before you choose this route.
We recommend getting quotes for both the cash purchased price and the financed price offered by a solar installer so you can get a sense of which financing option is best for you - getting your own financing or taking the solar loan.
PACE loans are another financing option for residential solar, but are only available in California, Florida, and Missouri. With PACE financing, you pay off the borrowed amount by increasing your property tax payment. However, PACE financing is complicated, and its intricacies caused some homeowners to get into hot water.
Solar financing: Red flags to look out for
Investing in a solar system is a huge financial decision, and finding the right company can seem pretty labor-intensive. To help you narrow it down, here are a few things you should avoid when financing your solar system.
- High interest rates and dealer fees: Dealer fee percentages are higher if your interest rate is low. You should run the numbers if both your interest rate and your dealer fee are high. It might not be a good deal, and you may want a personal loan or HELOC to pay for your system.
- Claims of “free” solar panels: If any financing company you use advertises solar loans as “free solar panels”, this is a major red flag. There is no such thing as free solar panels. This is a common sales tactic to lure in customers with no upfront costs. One thing is for sure: you will have to pay for solar one way or another.
- A low minimum credit score requirement: When it comes to financing, you’ll need a good credit score to be lent money. Companies that hand out money with a low or no minimum credit score might have high-interest rates or fees that could result in an issue for you to make monthly payments. This is a large reason why PACE financing has gotten a bad reputation.
Finding the right solar financing company
To find the right financing company for your solar energy system, you first need to find the right solar installer.
We advise anyone interested in switching to solar to get quotes from multiple local solar companies and check out their reviews on SolarReviews to see what solar installer is best for you. Many solar installers work directly with solar financing companies, so they will help connect you with solar loan, lease, and PPA providers.
You’ll find a financing option that works best for you, whether it's a personal loan from a bank, a federal credit union, or one of the solid companies listed above. Pretty soon, you’ll be on your way to powering your home with clean energy and seeing huge savings on your utility bill in no time!
If you’re curious about solar power and whether your home is a good fit, enter your home details into our solar calculator to get an estimate of cost, energy bill savings, incentives, and more!
Essie Magierski
Content Writer
Jamie is a Content Writer and researcher at SolarReviews. A recent graduate of La Salle University in Philadelphia, Jamie earned her B.S. in communications with a concentration in journalism, mass media, and public relations.