SolarCity, the largest supplier of solar has announced plans today to offer new customers in 14 states across the US, loans at favorable interest rates to boost sales.
The new offering
The new loan scheme replaces the previous MyPower product (which was a 30 year loan), with greater optionality on length of loan and allowing for early full or partial repayment with no additional costs.
The fixed monthly payment loans can be either ten years with an annual interest rate of 2.99 percent, or a longer 20-year loan at 4.99 percent and repayments starting at $50 per month. With either loan comes a 20 year warranty and continuous monitoring of the product.
“We can now offer a loan that makes it possible for many customers to pay less for solar from day one, and still receive thousands back in tax credits on top of that,” said the CEO of SolarCity, Lyndon Rive. “This program will allow thousands of additional customers across the U.S. to install solar this year and start saving money immediately, and we expect to work with multiple lenders that will allow us to expand to several new states by the end of the month with the same great terms for our customers.”
At the moment these loans are only available in 14 states, Arizona, California, Colorado, Connecticut, Delaware, Maryland, Massachusetts, New Hampshire, New Mexico, New Jersey, New York, Oregon, Rhode Island, Texas and Washington, D.C, but the company hopes to extend this to additional states in the future.
By providing a loan for the customer to actually purchase the solar panels, as opposed to leasing them, the company is transferring the tax benefits back to the homeowner. Legislation allows a 30 percent tax credit to the owner of the equipment (the customer now), which can be used against any owed taxes.
SolarCity leveraging their market share
The old MyPower product was an in-house loan. This new loan will be distributed by third-party providers, reducing the company’s exposure to defaults. Tim Newell, the SolarCity vice president for finance said, “More and more lenders have entered the market to provide solar loans,” he continued, “and through the size of our company, we are able to work with them to provide really attractive rates.”