FHA Solar Loan is Low Cost And Long Term

Mohidul Saad

Mohidul Saad is a co-founder of SOLARINSTALLGURU.COM, author and renewable energy benefit educator. He provides FREE online and offline training to home and business owners who are interested in reducing their electricity bills by 90 percent while slashing solar panel installation cost by 30-80 percent. DOWNLOAD this FREE renewable energy benefit education guide "101 ways to install solar system with little or no out of pocket cost" and start saving today.

FHA Solar Loan is Low Cost And Long Term

updated at : Thursday, January 19th, 2017

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The FHA Solar Loan Program: PowerSaver

Use the finance tool, PowerSaver, to get your solar installation project off the ground. If you are considering a solar installation but are hesitant to take the first step, the PowerSaver program could mean the difference between embarking on the renewable energy journey vs. maintaining the status quo. This low cost and long-term FHA PowerSaver financing could save you thousands of dollars by slashing your electricity bill.

FHA Solar Loan Advantages

The FHA solar loan program PowerSaver is unknown to most people but it is a great low-cost financing option for the people interested in installing a solar energy system on their rooftop. The two main advantages are a low borrowing cost and long-term financing. The FHA PowerSaver loan is guaranteed by the federal government. This is why it is cheaper than a personal loan. The most important advantage is the long duration of the loan. This is called the term of the loan. The personal loans are usually termed for 5-7 years. However, the FHA PowerSaver loans are termed for 20 years. Why does that matter? It matters because the longer the financing term, the lower the payment. This, in turn, makes the solar system investment profitable. How does the long-term financing make it profitable?

So How Do I Profit from PowerSaver?

The profit comes from the difference between the pre-solar electric bill and the post-solar electric bill. If the combined total of the post solar electric bill and the PowerSaver payment is lower than the pre-solar electric bill, you are making a profit. Due to the 20-year loan term, the loan payment remains low, making the solar investment profitable. Let’s take the example of the sticker price of $20,000.00 for a solar energy system installation cost. The Federal Government pays $6000.00 as a federal solar tax credit. Also, consider that you live in a state where the state tax rebate goes as high as 30%, you have saved another $6000.00. The initial solar system installation cost was $20,000.00 but is reduced to $8000.00 after utilizing the federal solar tax credit and state solar tax rebates.

Reduce Loan Principal

You will need the money upfront since the federal solar tax credit and the state solar rebates are realized at the end of the year. The FHA PowerSaver will make that money available to you. You can easily reduce the FHA PowerSaver loan principal when you receive the federal solar tax credit and state solar tax rebates. Your FHA PowerSaver loan payments are going to be significantly lower when you lower the principal of the loan.
The FHA solar loan program PowerSaver is a great vehicle to finance your solar energy system installation project. This low cost, long-term program is profitable for any homeowner. Picture your happiness when receiving your first reduced electricity bill. To find out more about the qualifications for the FHA loan program, visit fha.gov.