Finance for Solar, Batteries and the Install

Solar is one of the few things people borrow for where the purchase is meant to pay for itself. That makes the finance question sharper than usual: not just what it costs, but whether the repayment is smaller than what you stop paying the retailer.

Start with that test. If the repayment is comfortably below the expected saving on your bill, the system is funding itself. If it is above, you are buying a long-term asset on a shorter-term cost, which can still be the right call, but you should know that is what you are doing. Nobody can promise what you will save, because it depends on your system, your usage and your tariff, so be wary of anyone who does.

What can be included in the amount. More than people expect. Panels, the inverter, the battery, the installation itself, and often the associated work that makes it possible, such as a switchboard upgrade or meter work. The practical rule is the same as for vehicles: what is on the installer's invoice can generally be financed, what you buy separately afterwards usually cannot. Get one itemised quote covering the whole job rather than funding it in pieces.

Secured or unsecured, and why it matters here. Most residential solar is funded unsecured, because panels bolted to a roof are not security a lender can practically recover. Unsecured lending is priced for that. If you own a suitable asset, a secured loan can be a cheaper structure, though understand what you are doing before you put a vehicle behind a solar system. Our personal loans page covers both structures, and a solar system financed alongside other work is really a renovation conversation.

The installer's interest free offer is not free, and it is worth understanding why. Those plans are usually merchant funded: the installer pays the finance provider a fee and recovers it in the price of the system. There is often a monthly account fee running the whole term as well. None of that makes them a bad deal, and sometimes they genuinely win, but the only fair comparison is the plan's total repayments against the cash price funded another way, fees included, on the comparison rate rather than the headline number. Our guide to zero interest solar finance sets out exactly how those offers are built.

Rebates and schemes come off first. Federal and state programs are generally applied by the installer as a discount on the quoted price, so the amount you finance is the post-discount figure. Schemes differ by state, open and close, and change over time, so check the current position with your installer and the relevant government source rather than relying on a page.

What lenders assess. Income and its consistency, your existing commitments including card limits whether drawn or not, and your credit file, on which every application is recorded whether approved or not. Being matched to one lender that fits, rather than applying around, is what protects it.

If the system is for a business, it is a different product with different tax treatment and very different lender appetite: see commercial solar finance, equipment finance and chattel mortgages, with the instant asset write-off on the deduction side. Where the financials are not current, low doc business loans are assessed differently again, and where there is no suitable secured path, an unsecured business loan may be.

1. Get the quote first. One itemised quote covering panels, inverter, battery, installation and any switchboard or meter work. Funding the whole job in one amount is simpler and usually cheaper than funding it in pieces.

2. Run the repayment against the saving. We work out what the repayment looks like over different terms so you can see whether the system is funding itself or not. This is the step most people skip.

3. Compare the installer's offer properly. If there is an interest free plan on the table, we compare it against ordinary lending on the same basis, fees included. Sometimes it wins and we will say so.

4. We match it to a lender. From more than 40, the one whose criteria suit your situation. One application, not five, because every application is recorded.

5. Approval. We tell you what is outstanding rather than leaving you guessing, and what the lender needs before funds are released.

6. Documents. Contracts issued for electronic signing, with everything set out before you sign rather than buried.

7. Settlement and install. Funds are released in line with the installer's terms, which often means a deposit then a balance on completion. We make sure the timing matches the install date so nothing stalls on site.