Power Up Your Solar Journey: Pre-Approval, Quotes, and Deposits - The Aussie Guide
Thinking of joining the solar revolution and installing panels on your roof? Excellent choice! Not only are you contributing to a greener future, but you’ll also be slashing those pesky electricity bills. However, before you jump in headfirst, there are a few essential steps to take to ensure a smooth and successful solar installation experience. This isn't just about finding the shiniest panels; it's about financial preparedness and making informed decisions.
And remember, if you're in Victoria, don't forget to explore the government rebates! Check out our Complete Guide for all the details.
1. Pre-Approval: Knowing Your Financial Solar Power
Just like buying a house, understanding your financial capacity is crucial before committing to a solar system. This is where pre-approval comes in. Even if you're planning to pay upfront, having a pre-approved loan in place can give you negotiating power and flexibility. Many installers also offer financing options, so understanding your borrowing potential is essential.
What is Pre-Approval?
Pre-approval is an estimate from a lender of how much money they are willing to lend you based on your current financial situation. It's not a guarantee, but it provides a realistic borrowing range.
Why is it Important for Solar?
- Budget Clarity: It allows you to set a realistic budget for your solar system. Knowing how much you can borrow helps you choose the right system size and features without overspending.
- Negotiating Power: Pre-approval shows installers you're serious and financially prepared, potentially giving you leverage when negotiating prices.
- Faster Installation: If you need financing, having pre-approval streamlines the process and gets your system installed sooner.
- Avoid Disappointment: Imagine finding the perfect system, only to be denied financing later. Pre-approval avoids this heartbreak.
When to Apply for Pre-Approval?
Start the pre-approval process as soon as you start seriously considering solar. Ideally, do this before you even begin gathering quotes. This gives you ample time to explore your options and understand your financial limitations.
How to Get Pre-Approved?
- Gather Your Documents: You'll typically need proof of income (payslips, tax returns), bank statements, and details of any existing debts.
- Contact a Lender: Speak to your bank, a credit union, or a mortgage broker specialising in green loans.
- Be Honest and Accurate: Provide truthful information about your financial situation to ensure an accurate pre-approval assessment.
Keep in mind that pre-approval is based on your financial situation at the time of application and is subject to credit assessment, eligibility criteria and lending limits. It is not a quote or a guarantee.
2. Quotes: Shopping Around for the Best Solar Deal
Once you know your budget, it's time to gather quotes from multiple solar installers. Don't settle for the first offer you receive! Comparing quotes is essential to ensure you're getting the best value for your money.
What to Look for in a Quote:
- System Size (kW): This determines how much electricity your system will generate.
- Panel and Inverter Brands: Research the brands and models to ensure they're reputable and have good warranties.
- Installation Costs: This should be clearly itemised, including labour, materials, and any additional fees.
- Warranty Details: Understand the warranties offered on both the panels and the installation.
- Estimated Savings: The installer should provide an estimate of your potential electricity bill savings.
- STC Rebate: This is a government incentive that reduces the upfront cost of your system. Ensure the quote includes this.
Tips for Gathering Quotes:
- Get at Least Three Quotes: This gives you a good range of options to compare.
- Read Reviews: Check online reviews and ask for references from previous customers.
- Ask Questions: Don't be afraid to ask the installer any questions you have about the system or the installation process.
- Beware of Unrealistic Savings Claims: If the savings seem too good to be true, they probably are.
3. Deposits: Protecting Your Investment
After choosing an installer, you'll likely be required to pay a deposit. This secures your place in their installation schedule and covers the cost of initial materials.
Things to Consider with Deposits:
- Deposit Amount: A typical deposit is around 10-20% of the total system cost.
- Payment Terms: Understand the payment schedule and when the remaining balance is due.
- Cancellation Policy: What happens if you need to cancel the installation? Are you entitled to a refund of your deposit?
- Written Contract: Ensure you have a written contract outlining all the terms and conditions of the agreement, including the deposit amount, payment schedule, cancellation policy, and warranty details.
Red Flags to Watch Out For:
- High-Pressure Sales Tactics: Be wary of installers who pressure you to sign a contract or pay a deposit immediately.
- Unusually Low Prices: This could indicate poor quality equipment or substandard installation practices.
- Refusal to Provide a Written Contract: A reputable installer will always provide a detailed written contract.
- Cash-Only Deals: Avoid installers who only accept cash payments, as this can be a sign of unethical business practices.
By following these steps – securing pre-approval, comparing quotes, and understanding deposit terms – you'll be well-prepared to embark on your solar journey with confidence. Happy saving!
