Is it time to replace your home’s AC unit? Often we don’t realize it until we have a broken system that’s too costly to repair. Even a well-maintained unit can run for years, only to one-day hit a wall. And while your AC may currently run fine, it still may be draining your bank account due to its lack of energy efficiency.
Whatever the reason for replacement, all homeowners need to address the issue of financing their AC investment. Fortunately, you have more options today than ever to find the funds:
While this may seem like a financially sound approach, it can also be the riskiest. Cash transactions create little to no paper trail. Therefore, they’re the method of choice for unscrupulous contractors and con men. Yes, you’ll avoid financing fees, but you may lose that savings and more if your installer starts the work and then skips town.
Credit cards usually offer several perks. For example, they often provide purchase protection in the event a vendor doesn’t deliver on the service. Also, you can save with zero percent financing options, points programs, and travel miles available from companies like Wells Fargo Financing.
Be careful, however, to learn all the specific terms of the credit card agreement, like the interest rate, the period of 0% financing, and annual fees. If you’re diligent in making payments, credit cards are a very viable option.
Personal loans come from banks or individuals and are not secured against anything you own. Therefore, you’re not putting your house, or other high-value assets at risk by obtaining one. On the other hand, because personal loans put more risk on the lender, their interest rates and fees tend to be higher.
Home Equity Loans
Another popular way to finance your HVAC purchase is through a home equity loan or home equity line of credit. These are loans that secured against the equity you own in your house. Therefore, they tend to have the lowest long-term interest rates. Essentially, you borrow against your existing equity in your home and pay it back in installments.
Additionally, because an equity loan is secured against your home and is for making improvements, the money spent may be tax-deductible. Still, like other loans, you need to make sure you’re able to pay the loan back within its designated timeframe. That way, you avoid late fees or liens.
Contractor Finance Programs
Lastly, consider that a contractor may offer their HVAC financing. Installers sometimes form relationships with specific lenders as a way to facilitate business. Potentially the homeowner, contractor, and lender can all benefit from this kind of partnership. It’s especially handy when you’re working with an HVAC vendor you know and trust.
However, if you’re not as familiar with your contractor, be sure to check over all the fine print in any financing agreement. You don’t want to be scammed with hidden fees or out clauses.
Again, even if your AC isn’t broken, you may still be paying too much for it. To get sales and expert advice on your home’s next AC unit, contact Global A/C. We can help you with both installation and finance options.