Solar panel loans: put the sun to work without the big upfront bill

How do solar panel loans work?

A solar panel loan is borrowing used to buy and install a rooftop solar system. Instead of paying the full installed price on day one, you spread it over a term and enjoy the system while you repay.

The loan can take a few shapes. Many people use an unsecured personal loan, where nothing is mortgaged. Others use a secured loan, with the system or the home as security, which may widen lender choice and can spread the cost over a longer period. Some people draw on existing home equity through a top-up or a separate facility. Each approach has different costs, speed and risk, which we explain below.

What does the government rebate do?

Eligible rooftop solar systems earn small-scale technology certificates under the federal Small-scale Renewable Energy Scheme. In practice, you usually assign the certificates to your installer or an agent, who then reduces your quote by their value. The number of certificates depends on the system’s capacity, your postcode zone and the installation date.

Importantly, the period over which certificates are created falls by a year each year, and the scheme is legislated to end in 2030. That means the value of the incentive steps down over time. The Clean Energy Regulator publishes the rules and a calculator. Check the current details before you sign, and ask your installer to show the certificate discount clearly on the quote.

Who uses solar loans?

• Homeowners wanting to reduce power bills
• Families whose usage peaks in daylight hours
• Investors and landlords upgrading a rental
• Households planning to add a battery later; see home battery loans
• People combining solar with other upgrades such as home electrification

Which funding path suits which situation?

Path	Typically suits	Watch out for
Unsecured personal loan	Smaller systems; quick approval; no mortgage	Shorter terms can mean higher repayments
Secured loan	Larger systems; longer terms; weaker credit	The asset or home is at risk if you default
Home equity top-up	People with equity who want to roll it into their mortgage	Interest over many years can make the total cost large
Second mortgage	Equity held while a first mortgage stays in place	Typically for more complex needs; see second mortgages
Renovation or green loan	Solar as part of wider works	See renovation loans

For a more detailed comparison of secured and unsecured borrowing, read our guide on secured versus unsecured personal loans.

What do lenders look at?

• Your income and expenses. Can you service the repayments comfortably?
• Your credit history. Defaults, arrears and recent enquiries all matter. See how to improve your credit score.
• The purchase. A quote from an accredited installer with a clear scope and price.
• Your debts and commitments. Credit cards, existing loans and buy-now-pay-later accounts.
• Security. If secured, the property or equipment backing the loan.
• Your employment and living situation. Stability and residency.

How does Ownright approach solar loans?

Ownright Custom Finance is a solutions-first broker. Trevor Scott has more than 40 years in finance, and the team arranges personal, home, private and asset finance Australia-wide. For solar, we do not push a single product. We ask what you are trying to achieve, look at your income and equity, and compare structures that could fund the system sensibly.

If a standard lender has declined you, perhaps because of credit history or a complicated income, we look at other options, including secured and equity-based approaches. We do not promise approval, and timing depends on the lender, the security and how quickly your documents arrive. We do not install solar; you choose your own accredited installer.

An illustration

Illustrative scenario only. A couple in a regional town want a larger rooftop system because their power use is high, and they plan to add a battery in a couple of years. Their savings cover only part of the cost. One partner is self-employed with lumpy income. We review their tax returns, the installer’s quote and the equity in their home, then compare an unsecured loan with a modest top-up on their mortgage. Each carries different costs and risks, and they decide after seeing the full picture, including how much the certificate discount reduces the loan they need.

Mistakes to avoid

• Signing with the first installer. Compare quotes, equipment and warranties.
• Ignoring the whole cost. A lower repayment over a long term can cost more overall.
• Overbuying. A system larger than your usage can lengthen payback.
• Using a mortgage top-up without thinking. Solar bought with a 25 year mortgage is still being paid off long after the panels age.
• Skipping documents. Our guide on what documents you need for a loan saves time.

What other green upgrades can be funded?

If you also want to look at batteries, see home battery loans. Homeowners considering heat pumps, induction and insulation can read about energy-efficient upgrade loans, and business owners can look at business solar finance. Farmers should see farm solar and renewable finance.

How do I work out whether solar will pay for itself?

Start with your bills. Look at a year of electricity statements to see how much you use, when you use it and what you pay for each kilowatt hour, plus the daily supply charge. A household that uses most of its power during the day gets more from solar than one that uses most of it after dark.

Next, ask your installer for an estimate of annual generation for your roof, based on its direction, shading and your location, and ask how much of that you are likely to use yourself versus export to the grid. Exported power is usually paid at a lower rate than you pay to buy it, so self-use matters.

Then compare the net system price, after the certificate discount, with the likely yearly saving and the loan cost. The result is a rough payback period. Treat installer estimates with healthy caution and consider asking more than one installer.

If the numbers look sensible, the question becomes how to fund it with the least strain on your budget and the least total cost. That is where we come in, comparing loan structures so you can see them side by side.

Ready to power up with solar?

Sounds like you’re looking for a solar panel loan. We’re the lending experts in funding home energy upgrades, even when the usual doors are closed, so click the button below and see if you qualify.