Solar: Lease, Loan, or Cash?

Going solar is great, but how you pay for it determines whether it is a brilliant investment or a financial headache. There are three main ways to get panels on your roof.

1. Buying with Cash

Pros: Immediate ROI. You own the system 100%. You get to claim the 30% Federal Tax Credit. Your home value increases immediately.
Cons: Requires a large upfront expenditure ($15k-$25k).

2. Solar Loan

Pros: $0 down. You swap your electric bill for a loan payment that is often lower. Crucially, you still own the system, so you still get the Tax Credit and home value increase.
Cons: You pay interest, which lowers your total lifetime savings compared to cash.

3. Solar Lease / PPA (Power Purchase Agreement)

How it works: The solar company installs panels on your roof for free. You agree to buy the power they generate at a set rate, or pay a monthly rent for the equipment.
Pros: $0 down and usually no maintenance responsibility.
Cons: Beware. You do NOT own the system. You cannot claim the Tax Credit (the solar company keeps it). Most importantly, it places a lien on your home. If you try to sell your house, the buyer must agree to take over the lease, which kills many real estate deals.

Our Recommendation

If you can qualify for a loan, Ownership (Cash or Loan) is almost always superior to a Lease/PPA because of the tax incentives and home equity benefits.