Reading your 25-year loan result
Why 25 years offers the lowest payment but highest total cost
Stretching the same loan amount across more months lowers each individual payment but increases the total interest paid, since the balance accrues interest for a longer period. On a $28,000 loan at 6.99% APR, the 25-year term runs about $198 a month with roughly $31,316 in total interest, about $7,256 more than the same loan over 20 years. The CFPB's explainer on how loan amortization works covers why stretching the term changes the total this much.
Whether the loan outlasts the system's useful life
Most solar panels carry a 25-year manufacturer warranty and typically keep producing meaningful power well beyond that point, often 30 years or more with modest output decline. A 25-year loan generally stays within that productive window, though it uses up more of the system's warrantied life than a shorter loan term would before you own it outright. The 25-year lifetime savings calculator can help you see the full production and savings picture across that same window.
A common strategy: choose 25 years, pay it off faster
Some homeowners deliberately choose the 25-year term for its lower required payment and flexibility, then make extra payments toward principal whenever their budget allows, effectively shortening the real payoff timeline without being locked into a higher mandatory payment. The early payoff savings calculator shows what that approach could save in interest.
Checking for a prepayment penalty first
Before counting on the flexibility to pay off a 25-year loan early, confirm your loan doesn't carry a prepayment penalty that would offset those savings. The prepayment penalty cost calculator estimates what an early payoff might cost under a penalty clause. The CFPB's prepayment penalty explanation covers what to look for in your loan agreement.
Comparing the full range of terms side by side
If you haven't settled on a term yet, the loan term comparison tool shows 10, 12, 15, 20, and 25-year options together, making it easier to see exactly where the payment and total interest tradeoffs land across the full range. Borrow less by claiming first. The federal tax credit calculator in our Rebates & Incentives section estimates the federal credit and rebates so you can size the loan to the net cost.