Mass Solar Loan banks and program details

For homeowners in Massachusetts, finding a low-interest loan to finance their solar power system was easy with the Mass Solar Loan program.

The program, jointly administered by the Massachusetts Clean Energy Center (MassCEC) and Massachusetts Department of Energy Resources (DOER), leveraged $42.3 million in public funds to make low-interest, fixed-term solar loans more accessible for homeowners in Massachusetts.

It ran from 2015 to 2020 and is no longer available to Massachusetts homeowners.

The Mass Solar Loan program was developed to further encourage the adoption of solar panels in MA and support the Commonwealth's solar industry in a way that maximizes the benefit to the local economy.

"The genesis of this program came out of the Department of Energy Resources," explained Andrew Belden, director of solar programs at MassCEC. "They did a study in 2014 looking at the gross economic benefits to the Commonwealth of direct ownership versus third-party ownership. What it revealed is not just that direct ownership is better for homeowners… it’s also better for the Commonwealth as a whole, in terms of making sure those dollars stay within Massachusetts. The conclusions of that study were really the impetus for [the Mass Solar Loan] product."

With the study in hand, DOER and MassCEC built a loan program to ensure that solar energy system ownership is a viable option for homeowners in Massachusetts.

The result was a network of solar installers and financiers offering low-interest, fixed-term loans that make it easier for homeowners to buy their solar energy system outright rather than lease it from a third-party owner like SolarCity, Vivint Solar, or others.

System ownership means that homeowners aren't splitting the financial benefits of a solar energy system with a third-party owner, thereby ensuring they keep more of their system's value over its lifetime.

For homeowners financing their purchase with a solar loan, the lower the loan's interest rate, the higher the resultant solar savings. This is because less money is spent each month paying down the loan's interest, enabling more solar savings to accrue.

The Mass Solar Loan program had significantly lower interest rates than other solar loan options in Massachusetts.

EnergySage compared the Mass Solar Loan to the top three financiers quoted most frequently to Massachusetts shoppers in the EnergySage Marketplace when it was launched. We found that the Mass Solar Loan program's maximum interest rate (3.25%) was significantly lower than the average interest rate for all three financiers. It was even lower than the bottom 25th percentile of all loans offered in the Commonwealth.

Why were the interest rates so low? The Mass Solar Loan program used what's known as an "interest rate buy down" to pay off, or "buy down," some of the interest so homeowners can access lower rates. Loans offered through Mass Solar Loan were 3% lower than what those same lenders would otherwise provide to homeowners: The maximum interest rate was 3.25%, but many were even lower.

In addition to the interest rate buy down, the Mass Solar Loan program had two more incentives for borrowers who may not otherwise have access to financing. For homeowners with less-than-perfect credit scores, the program had a loan loss reserve incentive that helped participating lenders expand their eligibility criteria by reducing their financial risk. And, for homeowners with an annual household income of $80,240 or below, the program paid off a portion of their loan principal (20-30%) as soon as their solar installation was complete.

The Mass Solar Loan program was offered through qualified installers who passed the program's screening process (which includes a system inspection, design review, and reference check).

Installers applied for the program on your behalf, which you could then take to a participating bank or credit union. Take a look at the table below for more information on the banks that participated in the Mass Solar Loan program:

*Note: These rates are provided for informational purposes only and do not represent an offer. Contact each bank for more information about the rates available to you.

The Mass Solar Loan program also had a data dashboard that tracked the program's performance since its start.

According to the Massachusetts Clean Energy Center, "Mass Solar Loan helped 17 lenders issue nearly 5,800 loans, of which about 54% were to low- or moderate-income residents.  Over 50 MW of residential solar projects were financed."

The Mass Solar Loan program may be closed, but solar is still well worth it in Massachusetts. The Bay State offers great incentive programs that help reduce the cost of solar panels so you can save on your electric bills–some of the highest in the country.

There are plenty of ways to finance your solar panel system in Massachusetts, from credit unions to specialized solar lenders. Take a look at some of the top solar loan providers.