Heat pumps make your home more comfortable and more efficient, but like any other heating equipment, they come with a significant upfront cost. Investing in a heat pump can be cost-prohibitive for some people, but luckily, you can finance the heat pump and spread the cost out over time.
Wondering how to finance a heat pump? Check out these options. Or contact us directly to talk about the best heat pump loans for your budget.
In-House Financing From Jones Services
To help homeowners pay for heat pump installation, we offer in-house financing for qualified applicants. We have both short and long-term loans. The interest rates tend to be lower if you can pay off the cost of a new heat pump over a year or two. However, the rates are still competitive if you need several years to pay for the heat pump.
Generally, we partner with a commercial lender to offer you heat pump financing. The lender sets specific approval criteria for the loan, and they determine the payback period. We can give you more details on terms and conditions when you contact us.
It’s important to note that some lenders are affiliated with certain brands. For instance, a “Little Mitsubishi” loan only covers Mitsubishi products. With these loans, if you also buy equipment from another manufacturer, you may need a second loan to cover that.
Low-Interest Heat Pump Loans in New York State
The organization New York Clean Heat offers several low-interest loans to help residents of New York State finance the cost of a heat pump. As of 2022, here are the financing options.
On-Bill Recovery Loan
The On-Bill Recovery Loan is built into your energy bill. You just pay a little extra on your energy bill to cover the cost of buying and installing the new heat pump. You don’t have to make a separate loan payment. The payments are based on your estimated average energy savings.
Smart Energy Loan
This is an installment loan designed to help you upgrade to a heat pump. It offers a low-interest rate, and you make payments monthly until you pay off the equipment.
Renewable Energy Tax Credit Bridge Loan
This loan effectively helps you get tax credits early. It allows you to finance federal and state tax credits for heating with renewable energy. It only covers the costs that will be repaid with tax credits, but you can pair it with another financing option to cover the whole cost of the new equipment.
There is a $25,000 limit for both the On-Bill Recovery and the Smart Energy Loan. If those loans don’t cover your purchase price, you can use this loan for the remaining cost of your new heat pump.
Generally, with these state-endorsed financing options, you have to meet certain energy criteria. For instance, you may have to pass a home energy audit, or you may have to use a professional installer. Then, once you’re pre-qualified through the program, you go to a local bank to complete the loan funding process.
Low-Interest Heat Pump Loans in New Jersey and Pennsylvania
Although the above loans are specific to New York State, there are similar financing options available in Pennsylvania and New Jersey. Homeowners often get financing through groups such as New Jersey Clean Energy and the Pennsylvania Housing Finance Agency’s (PHFA) Homeowners Energy Efficiency Loan Program (HEELP). The exact offerings change regularly, but your heat pump installer will be able to tell you about the options.
Personal Finance Options for Heat Pumps
Most homeowners with good credit can easily qualify for financing through their installer, an energy collective, or a state-run program. However, these aren’t the only financing options for a new heat pump.
You may want to put the heat pump on a credit card, borrow from a retirement account, use a personal loan, or take out a home equity loan or line of credit. Ultimately, the best option is the one that gives you the lowest interest rates and the most affordable monthly payment. Don’t forget — you can also reduce the upfront cost with a heat pump rebate.
Contact Us to Finance a Heat Pump
At Jones Services, we can help you finance the cost of upgrading your home’s HVAC solutions. In the past, we’ve offered financing on Lennox heat pumps, Mitsubishi mini splits, gas boilers, oil boilers, whole-home humidification solutions, and more. We also offer payment plans on home heating service plans.
Our goal is to keep homes happy. Ready to upgrade your heating and cooling but want to spread out the cost over time? Then, contact us today to talk about financing a heat pump or other types of home heating solutions.