The HVAC system in your home is one of its most crucial components. Your HVAC system helps regulate the flow of air throughout your home and keeps temperatures at a comfortable level. It also helps maintain a high level of air quality. The cost of repairing or replacing this vital system can be high, but you’ve got several options when it comes to managing the expense.
Can You Afford a New HVAC System?
Many people would rather repair their existing system than install a new one. When repairing your HVAC system is feasible, that is likely the best way to save money. However, it’s not always possible to repair units at a reasonable cost. If the price of repairing your HVAC system outweighs the cost of a new one, it’s in your best interest to replace it. This is especially true in homes with older systems. Replacing an old, worn HVAC system can help you save not just on the expenses of a costly repair but can also provide you with a more energy-efficient model, which means you can save on energy bills.
The determining factors on repair vs. replacement include the condition of your existing unit, the size of your home, and the climate.
What Is an HVAC Loan?
HVAC replacement doesn’t need to be a major stressor for your finances. Even if you don’t have the cash up front, you still have options that can make it easier and more manageable. HVAC financing is one of these options.
This type of financing generally involves an unsecured personal loan that enables you to buy the HVAC system you need. The system itself will not act as collateral for your loan. Instead, your credit score will be the final determining factor as to whether you’ll qualify. Your credit score can also affect the cost of the loan and interest rates. If you have a great credit score, your financing costs will typically be lower.
Where Can You Go to Get an HVAC Loan?
Using a loan to purchase your HVAC system does not mean you’ll need to spend time at the bank. In fact, many HVAC services allow you to apply for loans directly through them, and once you’re approved, the funding will go to the service, which can immediately begin work on your project. The type of terms that you reach with the service will be determined by the arrangement that they have with their approved lender.
Do You Need to Have Perfect Credit?
Contrary to popular belief, you don’t always need to have a perfect credit score to qualify for an HVAC loan. Most companies offer a range of programs that are designed to meet the needs of people with credit scores ranging from high to low. If you don’t qualify for one program, you might easily succeed with another.
Pay Attention to Your APR
Once you have your financing, note the Annual Percentage Rate (APR). This is the rate of interest that you’ll pay annually. The total amount of interest will be determined by the size of the loan.
Keep in mind that the loan with the lowest APR will tend to be the least costly in the long run. This will be true even if you don’t choose the one with the lowest rate of actual interest.
The Length of Repayment Time Matters
Another factor to consider will be the length of the repayment time. This will be the total amount of time that you will be given to completely pay off your loan.
In many cases, a shorter term of repayment time can lead to a cycle of higher per-month payments even with a potentially lower rate of APR. For this reason, someone with worse credit or a lower income may be well advised to bite the bullet and choose a deal with longer repayment terms. This can help keep monthly payments more affordable and might even help them save in the long run.
You May Be Qualified to Receive Discounts
Getting an HVAC loan through a company that your service partners with can qualify you for special discounts. This is especially likely if you happen to have a pre-existing relationship with that bank or lender. You may be able to qualify for several special arrangements, such as signing on to an automated loan repayment program or interest-free financing.
Pay Attention to Your Monthly Payments
The size of your monthly payments can determine if you’ll be able to pay the full amount promptly. Keep in mind that you will also need to meet all of your other monthly expenses. For buyers with a lower level of income, it may be wise to extend the repayment period to lower your monthly payments.
Watch Out for Any Potential Fees
Most lenders are upfront about the various types of fees and penalties that you could potentially incur. These might include prepayment penalties. It’s a good idea to go over all of these potential fees so that you don’t run the risk of being caught unaware. Review the paperwork and be sure to ask questions to get the full details.
When is the Best Time to Get a Loan?
The best time to apply for an HVAC loan will be in the spring or fall seasons. These are the times of the year when prices for a new system will be the lowest. Temperatures during these seasons are typically moderate and less extreme. As a result, HVAC companies are dealing with less demand and can often offer you a better deal.
Why Get Financed Through an HVAC Company?
There are several key benefits that you can enjoy when you finance your purchase through an HVAC company. For one, you are dealing directly with the service that will install, maintain, and repair your system. You’ll have a sense of security knowing that the company can provide your system and keep it running efficiently.
The next major benefit will be convenience. You don’t have to do all of the research, make all the phone calls, and email various lenders to secure the loan. Instead, you can submit your application directly through the HVAC company. In most cases, you will know shortly whether your request has been approved or denied.
A further benefit to consider may well be the amount of money that you can save by choosing the right type of loan. If your credit is questionable or you don’t have a lot of cash to invest, a loan with a longer repayment term may be your best bet. On the other hand, if you can pull off paying a loan with a shorter period, it certainly won’t damage your credit score.
Contact Gallagher’s for More HVAC Financing Info
If you need more information about HVAC financing, Gallagher's Plumbing, Heating and Air Conditioning is here to help. We are the primary source for all of your plumbing, heating, and air conditioning needs. Our service is centrally located to handle calls in the Greater Sacramento and Northern Valley areas. Contact us today to learn more about how to finance your HVAC purchase.
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