SolarCity Relaunches Residential PV Loan With Simpler, Shorter-Term Plan | Alternative Energy | Forums

Should make it a lot easier for people who don't have the money up front

In February of 2016, a little over a year after its intro, SolarCity pulled its complex loan product and began to develop a replacement loan offering.

Tim Newell, VP of financial products at SolarCity, told GTM, "We issued more than 21,000 loans for a total value of just under $600 million. It was a product that customers liked. We issued more solar loans than any other seller in the U.S. during 2015."

Newell added, "MyPower loan was designed, essentially, to replicate a power purchase contract. It was over thirty years and the monthly payments varied with the production of the system.

The contract also had a 2.9 percent escalator.

Nicole Litvak, senior solar analyst with GTM Research said, “It seemed like it would be a simple transition. It turned out to be totally the opposite.” She added, "Even for the customers who were able to take advantage of the ITC, there were still numerous other sticking points that made it a tough sell. There was the issue of a 2.9 percent escalator, which made the transaction more like a PPA than a fixed loan. Another problematic feature was the 30-year payback period, far longer than the average 20 years for PPAs. “

As we reported, Solar marketplace, Pick My Solar, found that the cost of MyPower for the average California customer was more expensive than other options in the market.

Newell said that customers wanted "the option for shorter terms on a loan and fixed monthly payments." The new loan has the option of a 10-year loan and a 20-year loan with annual percentage rate down to 2.99 percent and 4.99 percent respectively along with no prepayment penalty. The loans include a service package including a 20-year warranty, production guarantee, and continuous monitoring. "That's all included in the price that we sell to them," said the VP.

more http://www.greentech.....-Term-Plan