Solar Loan Calculator
Financing changes the shape of solar economics more than it changes the total. A 15-year loan at 6.99% with 20% down turns a ~$17,000 net cost into a monthly payment that may be close to the bill you are replacing — which is…
What this estimate does
Financing changes the shape of solar economics more than it changes the total. A 15-year loan at 6.99% with 20% down turns a ~$17,000 net cost into a monthly payment that may be close to the bill you are replacing — which is exactly how the pitch is usually framed. But a financed system also carries dealer fees that are frequently buried in the quoted $/W, and the payment continues for years after any tax-credit expectation has vanished. This page amortizes the loan, shows total payments, and compares the 25-year net against a cash purchase on identical assumptions.
Your inputs
Change any default to match your bill, your quote and your utility tariff.
Household and price
Roof and solar resource
Money, financing and 25-year assumptions
Your estimate
Federal residential credit (2026)
$0.
Itemized cost
Ownership comparison · 25-year net
| Cash purchase | — |
|---|---|
| Loan (after payments) | — |
| Lease / PPA (no upfront) | — |
| Loan monthly payment | — |
The cash and loan rows both exclude any federal credit. A third-party owner, not you, may claim section 48E.
Environmental scale
| CO₂ avoided in year one | — |
|---|---|
| Mature-tree equivalent | — |
| Gasoline car miles | — |
Uses 0.855 lb CO₂/kWh (U.S. grid average), 48 lb/tree/year and 0.89 lb/mile.
25-year cumulative net cash flow
Sensitivity to utility rate escalation
| Annual escalation | Payback | 25-year net |
|---|
Year-by-year cash flow
| Year | Production kWh | Bill savings | Maintenance | Net | Cumulative |
|---|
How this is calculated
Loan principal = net cost × (1 − down payment %). Monthly payment uses the standard amortization formula P × r ÷ (1 − (1 + r)^−n) with r = APR ÷ 12 and n = term × 12. The 25-year financing result is −down payment − all loan payments over the term + the full stream of annual bill savings net of maintenance. Cash purchase is simply −net cost + that same savings stream. Both start from a net cost that includes a $0 federal credit.
A worked example
On a $16,972 net cost with 20% down, about $13,578 is financed. At 6.99% over 15 years the payment is roughly $122 a month, or about $1,462 a year — close to a $150 monthly electric bill. Total payments over the term are near $21,900 plus the $3,394 down payment. That is materially more than the cash price, and it is before any dealer fee embedded in the quote. Compare '25-year net' for cash versus loan in the financing table to see the difference on one basis.
What this tool does not do
It does not model dealer fees, a teaser rate, a reamortization requirement, prepayment penalties, a pledged-funds structure, or tax-deductibility of interest (generally unavailable for home solar consumer loans). Ask the lender for the APR and the total of payments, not just the monthly figure.
Practical checks before you compare quotes
- Ask for the cash price and financed price as separate lines.
- Check the total of payments, not just the monthly amount.
- Confirm whether the quoted APR assumes a large dealer fee.
- Verify prepayment terms before taking a long term.
Common mistakes
- Comparing a loan payment to a full electric bill that includes fixed charges.
- Assuming the monthly payment includes insurance and maintenance.
- Forgetting that the panels degrade while the payment escalates or stays flat.
- Believing a loan restores the expired credit.
Planning estimates only — not a quote, tax advice, legal advice or financial advice. State benchmarks are not your utility tariff. Verify every incentive with the program administrator and get at least three written installer quotes.
Frequently asked questions
Is a solar loan tax deductible?
Consumer solar loan interest generally is not deductible as home mortgage interest. Ask a tax professional about your specific situation; do not assume the old home-equity treatment applies.
What is a dealer fee?
Some installers pay an upfront fee to offer a lower nominal APR, and recover it by raising the system's cash price. Always ask for the cash price and the financed price separately.
Should I pay cash or finance?
Compare the 25-year net in the financing table. If the loan's APR exceeds what your cash could earn after tax, cash usually wins — but liquidity and risk tolerance are personal decisions.
Does a loan change the federal credit?
No. The 2026 federal residential credit is $0 whether you pay cash or finance. A loan cannot create a credit that the law no longer provides.
Sources and further reading
- HelioCalc methodology and calculation kernel
- IRS FS-2025-05 (2026 federal credit rule)
- EIA Electric Power Monthly, Table 5.6.A, August 2026