The Ultimate Guide to US Solar PV Financing: Tips, Tricks, and Techniques for 2025
Going solar can dramatically cut your energy bills and carbon footprint. However, the upfront costs of a photovoltaic (PV) system can be intimidating. Fortunately, 2025 is a great time for U.S. homeowners to invest in solar thanks to robust financing options and government incentives. In this guide, we’ll break down US Solar PV financing from federal tax credits and PACE programs to picking top solar lenders, comparing solar PV loan vs lease options, and even financing DIY solar PV projects.
US Solar PV Financing in 2025: A Comprehensive Guide for Homeowners
Going solar can dramatically cut your energy bills and carbon footprint. However, the upfront costs of a photovoltaic (PV) system can be intimidating. Fortunately, 2025 is a great time for U.S. homeowners to invest in solar thanks to robust financing options and government incentives. In this guide, we’ll break down US Solar PV financing from federal tax credits and PACE programs to picking top solar lenders, comparing solar PV loan vs lease options, and even financing DIY solar PV projects. By the end, you’ll understand how to make solar affordable and choose the best financing path for your home.
1. US Government-Backed Incentives for Solar in 2025
An essential driver for solar adoption is government-backed incentives. Here’s a look at what’s available:
Federal Investment Tax Credit (ITC) – 30% in 2025:
The federal Residential Clean Energy Credit (ITC) lets you deduct 30% of your solar installation cost from your federal taxes . For example, on a $20,000 solar array, you could claim a $6,000 credit—directly reducing your tax bill. The ITC applies to both solar PV and related equipment (like batteries) and remains at 30% for systems installed through 2032, provided you own the system. (If you finance your solar project, the lender holds a lien until the loan is paid off.) Keep in mind that this credit is nonrefundable—it only reduces your tax liability to zero, and any unused credit may roll over to the following year.
Property Assessed Clean Energy (PACE) Programs:
PACE programs let homeowners finance solar and energy improvements through property taxes. They offer low-cost, long-term financing repaid as an assessment on your property tax bill. PACE is typically available in states such as California, Florida, and Missouri (more info here ). Be aware that PACE debt follows the property, so if you sell your home, the obligation transfers to the new owner. This financing method generally requires no credit check or upfront payment, making it an attractive option—but review the terms carefully.
State and Local Solar Incentives:
Beyond federal programs, many states and municipalities offer additional incentives:
- State Tax Credits: Some states, like New York and Arizona, provide state income tax credits that stack with the ITC (details here ).
- Sales and Property Tax Exemptions: Many states waive sales tax on solar equipment and exempt the installation from property tax reassessments (see details here ).
- Utility or Local Rebates: Some utilities offer rebates that reduce your upfront costs. For instance, New York’s NY-Sun program provides significant upfront rebates (more info here ).
- Performance Incentives (SRECs): In states such as New Jersey, you can earn credits based on your system’s energy output, which can be sold for extra income (details here ).
- Net Metering: Although not a direct cash incentive, net metering lets you earn credits for surplus solar energy fed back to the grid (learn more here ).
For a full list of state-specific programs, consult resources like DSIRE (Database of State Incentives for Renewables & Efficiency) (link here).
2. Top Reputable Lenders for Solar PV Financing in 2025
Most homeowners finance their solar systems via loans rather than paying cash. Here are some of the top lenders known for their favorable solar loan terms:
Mosaic:
- Credit Score: Starting at 640
- Loan Term: 10 to 25 years
- APR: Approximately 3.99% and up
- Highlights: No money down; widespread installer network
(See details here ).
Sunlight Financial:
- Credit Score: Typically around 650
- Loan Term: Average terms around 20 years
- APR: Around 3%–6% (with some 0% promo offers)
- Highlights: Low/zero-interest plans; includes batteries & roof work
(Details available here).
GoodLeap:
- Credit Score: As low as 600 for smaller loans
- Loan Term: 7 to 25 years
- APR: Approximately 2.99%–6%
- Highlights: Fast fintech approvals; financing available for additional energy efficiency upgrades
(More info here ).
Dividend Finance:
- Credit Score: Around 660
- Loan Term: 12 or 20 years
- APR: Roughly 3.5% to 7%
- Highlights: Backed by Fifth Third Bank; unique 18-month reduced payment period
(Additional details here ).
Energy Loan Network (ELN):
- Highlights: Connects you with local credit unions offering competitive, fixed-rate loans averaging around 5.24% over 8–20 years.
(See further here ).
LightStream (Truist Bank):
- Credit Score: Minimum ~660
- Loan Term: 2 to 12 years
- APR: Approximately 7.99%–21%
- Highlights: Unsecured personal loan; excellent for DIY projects since funds are received directly
(More details here ).
Below is a quick comparison table:
| Lender | Min. Credit Score | Loan Term Options | Approx. APR Range | Notable Features |
|---|---|---|---|---|
| Mosaic | 640 | 10 – 25 years | ~3.99% – 7% | No money down; strong installer network |
| Sunlight Financial | 650 | ~20 years | ~3% – 6% | Low/zero-interest plans; includes batteries/roof work |
| GoodLeap | 600+ | 7 – 25 years | ~2.99% – 6% | Fast fintech approvals; covers multiple efficiency upgrades |
| Dividend Finance | 660 | 12 or 20 years | ~3.5% – 7% | 18-month reduced payment period; backed by Fifth Third Bank |
| ELN | Varies | 8 – 20 years | ~5.24% (average fixed) | Connects with credit unions; personalized service |
| LightStream | 660 | 2 – 12 years | ~7.99% – 21% | Unsecured personal loan; ideal for DIY projects |
Table: Comparison of top solar PV financing lenders for 2025. Rates and terms are approximate and subject to market conditions.
Each of these lenders offers solar loans with $0 down, enabling you to finance the entire cost and start saving immediately. The key is to compare not only interest rates but also any dealer or origination fees, and the structure of the loan (some require a larger payment after receiving your tax credit). When you select a reputable lender, you ensure transparent terms and reliable support throughout the life of your loan.
3. Solar Loan vs. Lease: Which Is Better for You?
When financing a solar PV system, homeowners typically choose between taking out a loan (to buy the system) or signing a lease/PPA (to rent the system’s output). The difference primarily boils down to ownership and long-term savings.
Ownership and Incentives:
A solar loan gives you full ownership of your panels. This means you qualify for the 30% federal tax credit, state incentives, and any renewable energy certificates you might earn. Conversely, a solar lease or PPA means a third party owns the system; while you save on energy costs, you miss out on the tax incentives (learn more about each option here ).
Upfront Cost and Payment Structure:
Both options can come with no upfront cost. With a loan, you finance the purchase and pay monthly installments; once the loan is paid off, you own the system outright and enjoy free solar power thereafter. With a lease or PPA, you continue making payments for the duration of the contract (often 20–25 years), which usually means a lower initial monthly cost but higher lifetime payments.
Long-Term Financial Impact:
- Loan (Buy): After the loan is paid off, you benefit from decades of reduced electricity costs, potentially saving tens of thousands over the lifetime of the panels.
- Lease/PPA: You pay continuously without ever owning the system, which typically means lower savings over time. Leases often include annual escalators, further reducing long-term benefits.
Which Option Is Right for You?
- Choose a Loan: If you have the tax appetite to utilize the credits and want maximum financial benefits, owning your solar system is typically the best route.
- Choose a Lease/PPA: If you prefer minimal responsibility for maintenance and are not eligible for tax credits, a lease or PPA may be more attractive, especially if you plan on moving before the system is paid off.
4. DIY Solar PV Financing
If you’re a hands-on homeowner planning to install your solar panels yourself, financing becomes a bit more nuanced. Traditional solar loans often require professional installation; however, there are options available for DIY projects:
Financing Options for DIY Installations:
- Personal/Green Loans: Personal loans from banks or credit unions (such as those from LightStream) can be used to finance your DIY solar project. These loans don’t require contractor installation proof and offer flexible disbursement directly to you for purchasing equipment (see details here).
- Home Equity Loans/HELOCs: If you have sufficient home equity, you can use a HELOC to finance the purchase. These loans typically offer lower interest rates and longer repayment periods (more info here ).
- Credit Cards or Store Financing: For smaller projects, some homeowners may use credit cards or promotional financing from equipment retailers; however, these options may have higher interest rates if not paid off promptly (learn more here ).
DIY Incentives and Considerations:
DIY solar installations still qualify for the 30% federal tax credit on equipment costs, even if you install the panels yourself (as long as your system is grid-tied and meets local code). However, many state or local rebates may require professional installation or inspection—so always verify local requirements before proceeding. Keep in mind that DIY projects may face higher interest rates if using general personal loans, and you must handle permitting, code compliance, and inspections on your own.
Final Thoughts:
Going solar in 2025 is more accessible than ever. Government incentives help make it possible for homeowners to enjoy reduced energy bills. Favorable financing options also contribute, as do innovative DIY approaches. These factors lead to a smaller carbon footprint. You can choose a solar loan, lease, or DIY installation. It’s essential to crunch the numbers and compare offers. Ensure your choice aligns with your financial situation. With careful planning and the right financing strategy, you can harness the power of the sun and turn it into long-term savings.
Post Financial Disclosure
Financial Disclosure: The information provided in this post is intended for educational purposes only. It is also meant for entertainment purposes only. This information should not be construed as financial advice. Always consult with a qualified financial professional. This content is not a substitute for personalized advice tailored to your individual circumstance. For Further information see here.
