Paying cash for solar gives the best lifetime savings and full ownership; a loan spreads cost with little or no money down while you still own the system; a lease has no upfront cost but lower savings and no ownership. With the federal credit gone in 2026, ownership matters more.
How you pay for solar shapes your savings, your ownership and your tax situation, and the calculus changed in 2026 when the federal residential credit ended. This guide compares cash, loan and lease so you can choose the path that fits your goals.
Paying Cash
Paying cash gives you the lowest lifetime cost and full ownership, since there is no interest. The trade-off is the upfront outlay, and as of 2026 a cash purchase no longer earns the federal residential credit. For homeowners who can fund it, cash still delivers the strongest long-term return.
Financing With a Loan
A solar loan lets you own the system with little or nothing down, paying a fixed monthly amount that your energy savings help cover. You keep ownership and the home-value benefit, including the property-tax exclusion, while spreading the cost. This is the most common path for homeowners who want ownership without a large upfront check.
Leasing or a Power Purchase Agreement
With a lease or power purchase agreement, the provider owns the system and you pay for the equipment or the power it produces. The provider claims the commercial credit and passes part of the value through as a lower rate. You give up ownership and direct incentives, but you avoid upfront cost and maintenance responsibility. In 2026 this is the remaining pathway that carries federal-credit value for homeowners.
- Cash, lowest lifetime cost and full ownership, largest upfront outlay.
- Loan, ownership with $0 down and a fixed monthly payment.
- Lease or PPA, no upfront cost, provider owns the system.
- Ownership paths keep the property-tax exclusion on added home value.
| Factor | Cash | Loan | Lease / PPA |
|---|---|---|---|
| Upfront cost | Full system cost | Little to none | None |
| Who owns the system | You | You | The provider |
| Lifetime savings | Highest | High | Lowest |
| Monthly payment | None | Fixed loan payment | Lease or per-kWh payment |
| Best for | Maximizing return | No money down, still own it | Avoiding ownership and maintenance |