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Solar Loan Calculator

Estimate monthly payment, total interest, and year-1 cash flow on a financed solar system. Free solar loan calculator using current 2026 U.S. lender APRs.

Solar Loan Calculator

Monthly payment
$195
Total paid over term
$28,043
Total interest
$10,043
Year-1 net monthly cash flow
-$62
Negative — loan exceeds savings (will improve as rates escalate)
Annual amortisation schedule
YearInterestPrincipalBalance
1$1,405$932$17,068
2$1,327$1,010$16,058
3$1,244$1,093$14,965
4$1,153$1,184$13,781
5$1,055$1,282$12,499
6$949$1,388$11,110
7$833$1,503$9,607
8$709$1,628$7,979
9$574$1,763$6,216
10$428$1,909$4,306
11$269$2,067$2,239
12$98$2,239$0

How to use this calculator

Enter four numbers and the calculator returns your monthly payment, total paid over the term, total interest, and year-1 net monthly cash flow (savings minus payment):

  1. Loan amount — the financed cost. Most U.S. lenders finance 100% of gross system cost; the 30% ITC then arrives at tax time and is applied as a re-amortisation payment 12-18 months in. The default $18,000 reflects EnergySage’s H2 2025 median 7 kW system at $2.85/W. If you’re looking at a $0-down dealer deal, add the dealer fee (typically 25-30%) to the gross cost — that’s your true financed amount.
  2. APR — the annualised rate from your loan estimate. Q1 2026 ranges: GoodLeap 6.49-8.99%, Sunlight Financial 5.99-9.99%, Mosaic 6.99-9.49%, Dividend 7.49-9.99%, local credit unions 5.49-8.49% (often the best deal for owner-occupants with 720+ FICO).
  3. Term — most solar loans are 10, 12, 15, 20, or 25 years. Shorter = less total interest. Longer = lower monthly payment. Use 12 years for the conservative middle of the market.
  4. Year-1 monthly bill savings — the average dollars your solar offsets per month in year one. Compute as: annual production × your retail rate ÷ 12. Example: a 7 kW system in Phoenix produces 12,000 kWh × $0.13 = $1,560/yr = $130/mo.

How the math works

Solar loans use standard amortising-loan math (the same formula as a mortgage or auto loan):

monthly_payment = P × r / (1 - (1 + r)^-n)
where:
  P = principal (financed amount, in dollars)
  r = APR ÷ 12 (monthly rate, decimal)
  n = term in months

Worked example for the en-us defaults ($18,000, 7.99% APR, 12 years):

  • r = 0.0799 / 12 = 0.006658
  • n = 144 months
  • monthly = 18,000 × 0.006658 / (1 - 1.006658^-144) = $194.81/month
  • Total paid = 194.81 × 144 = $28,053
  • Total interest = $28,053 - $18,000 = $10,053

Net cash flow = bill savings - payment. With the default $133/mo savings, net = $133 - $195 = -$62/mo year 1, which improves to roughly $20/mo positive by year 8 once retail rates have escalated 25-30% above today’s level.

What “positive cash flow” actually means in 2026

Most marketers claim solar produces “positive cash flow from day one.” That is true in California (PG&E Tier 4), Hawaii, Massachusetts, and Connecticut at current 2026 rates, where retail electricity is high enough that even a 25-year loan at 7.99% leaves $30-100/mo positive in year one. It is not generally true in Idaho, Washington, Louisiana, or Tennessee where retail rates sit at $0.10-0.13/kWh and a financed system shows -$40 to -$80/mo until year 5-7 when rate escalation crosses the loan payment line.

The honest framing: “cumulative positive” — over 25 years, savings exceed total loan payments in essentially every U.S. state once the 30% ITC is applied as a re-amortisation payment.

Loan vs. cash vs. lease — quick comparison

OptionUp-front cost25-year netBreak-evenBest for
Cash$18,000$34,000+ savings7-8 yrsHigh-tax-bracket owners with cash on hand
Loan (12-yr, 7.99%)$0 down$24,000 savings9-11 yrsOwners who want to keep cash deployed elsewhere
Loan (25-yr, 5.99%)$0 down$11,000 savings17 yrsCash-flow-first buyers with thin margins
Lease / PPA$0 down$4,000-7,000 savingsn/a (no equity)Renters of equity, not owners

The owned-loan structure typically beats a 25-year lease by $15,000-20,000 in lifetime value because the homeowner keeps the ITC, the depreciation (commercial only), and the post-loan free electricity for years 13-25.

What changes the loan economics

Helps (cheaper loan, faster cash-flow positive)

  • Credit-union loan or HELOC at 5.5-6.5% rather than dealer-aggregator 7.5-9% products
  • No dealer fee — pay attention to APR + dealer fee, not just APR
  • Apply the ITC promptly as a re-amortisation principal payment (most lenders give 12-18 months)
  • Battery + TOU rate to capture peak-rate arbitrage in a NEM 3.0 state
  • State property-tax exemption (38 states + DC; see DSIRE for your state)

Hurts (more expensive loan, slower payback)

  • Dealer-fee buy-downs — a “1.99% APR” loan with a 30% dealer fee on a $20k system effectively costs the same as a 7-8% loan with no fee
  • Failure to apply the ITC as a re-amortisation principal payment within 18 months — payment stays elevated for the full 25-year term
  • Demand charges or NEM 3.0 export-only credit that cuts year-1 savings by 30-50%
  • A roof that needs replacement within 10 years — re-roofing forces panel removal/reinstall, typically $2,000-4,000

Pair this with the payback calculator, system cost calculator, and ROI calculator

The loan calculator answers “what does the monthly payment look like?” Payback answers “when do I break even on the net cost?” ROI answers “what’s my total lifetime return?” Cost gives you the up-front capital to plug in. Run all four — and verify your APR with at least three lenders (one credit union, one bank, one solar-aggregator) before signing.

Sources

Frequently asked questions

What APR should I expect on a 2026 U.S. solar loan?
The Q1 2026 EnergySage Marketplace data shows residential solar loan APRs ranging from 5.99% (top-tier credit at GoodLeap, Sunlight Financial, or a credit union) to 9.99% for average-credit borrowers. Mosaic and Dividend Solar typically price 7-9%. Watch for dealer-fee buy-downs — a 0.99% APR teaser usually has a 25-30% dealer fee baked into the financed amount, which can erase the rate advantage. Compare APR plus dealer fee, not the headline rate alone.
Is the federal Investment Tax Credit (ITC) financed or paid back to the loan?
Most U.S. solar loans are structured with an 18-month re-amortisation: you finance the full gross system cost, then receive the 30% federal ITC at tax-filing time and apply it as a lump-sum principal payment within 18 months. If you do, the loan re-amortises and your monthly payment drops by about 30%. If you don't (or your tax liability is too low to claim the full ITC), the payment stays at the higher level — which is the most common cause of negative cash flow on financed solar.
Should I take a solar loan or pay cash?
Pay cash if you have it and can earn less than the loan APR risk-free elsewhere. With Treasury yields around 4-5% in 2026 and solar loans typically 6-9%, cash usually wins for the math-driven buyer. Take a loan if (a) you'd rather keep cash for emergencies/investment, (b) you can deploy the cash at a higher return than the loan rate, or (c) you want $0-down and positive cash flow from day one in a high-rate state like California or Massachusetts.
How does the loan term affect my total interest paid?
A 25-year solar loan at 7.99% on $18,000 totals about $41,700 paid (interest $23,700). A 12-year loan at the same APR totals about $28,053 (interest $10,053). Shorter terms slash total interest but raise monthly payments. The sweet spot for most U.S. homeowners in 2026 is 10-15 years — long enough to keep monthly cash flow positive in most states, short enough to keep total interest under 50% of principal.
Is solar loan interest tax-deductible in the U.S.?
Yes if the loan is secured by your home (HELOC, home equity loan, or a solar-specific second mortgage). The TCJA-era $750,000 mortgage debt cap applies, but few solar borrowers approach it. Unsecured solar loans (the most common product from GoodLeap, Sunlight, etc.) are generally NOT tax-deductible — only the 30% ITC applies. Confirm with your CPA. The IRS Form 5695 captures the ITC; loan interest deductibility lives on Schedule A.

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