Third-party owned

Solar lease: $0 down, but you do not own the system.

The solar company owns the panels and claims the Section 48E commercial credit. You pay a monthly fee. Sunnova filed Chapter 11 in June 2025 and is not available. Verify availability and state rules before signing.

Financing detail

Solar Lease (Third-Party Owned)

Ownership outcome

Third-party company owns the system

Federal Section 48E applies

Yes -- the third-party owner or commercial entity can claim it

The lessor (third-party owner) claims the Section 48E commercial ITC at 30%. The homeowner receives no direct federal tax credit. The benefit is indirect: the lessor uses the credit to offer a lower monthly rate than would otherwise be possible. Homeowner benefit depends on how much of the credit the lessor passes through in pricing.

Term options

20, 25 years

Data as of: 2026-06-02

Strengths

$0 down payment; no capital required
Immediate savings on electricity bills (typically 10-30% below local utility rate)
No maintenance responsibility: lessor handles equipment monitoring and repair
Lessor passes some Section 48E commercial ITC savings as lower monthly rate
Predictable payments with a known annual escalator

Considerations

Homeowner never owns the system during the lease term; limited home value increase
Long-term savings significantly lower than ownership over 25 years
Lease must be transferred to buyer (who must qualify) or bought out at home sale
No access to state incentives, SRECs, or utility rebates for the customer
Annual escalator (typically 0-3.5%) means payments rise each year
TPO company financial instability is a real risk (Sunnova filed Chapter 11 June 2025)
Limited equipment choice: customer takes what the lessor installs

Best for

Customers with limited capital or no tax liability who want guaranteed day-one savings with $0 down and no maintenance responsibility. Best when the monthly savings clearly exceed the lease payment from month one.

Compare this option against cash, HELOC, and prepaid in the 25-year true-cost tool.

No contact required. Enter your system cost and dealer fee percentage and see the total for each path.

Open the Financing Comparison Tool

Common questions

Questions about Solar Lease (Third-Party Owned)

Back to all financing options

Who owns the solar system under a lease?

The solar leasing company retains ownership of the panels for the duration of the lease, typically 20 to 25 years. Because the leasing company owns the equipment, it is the entity that claims the Section 48E commercial credit. The homeowner does not receive any direct federal tax benefit.

Is a solar lease available everywhere?

Solar lease programs are not available in every state or from every provider. Sunnova, which was a major lease provider, filed Chapter 11 bankruptcy in June 2025. Verify availability with the specific provider and check that the company has a stable servicing arrangement before signing a 20-year contract.

What happens at the end of a solar lease?

At lease end, you typically have three options: renew the lease, have the panels removed, or purchase the system at fair market value. The fair market value at year 20 to 25 is usually low because of panel age. The purchase option, if priced appropriately, can be attractive. Review the end-of-lease terms before signing.

Does a solar lease affect my home sale?

A solar lease is a contract tied to the property, not the homeowner. When you sell, the buyer typically assumes the lease or you buy it out. Many buyers prefer owned systems. Review the lease transfer terms before signing.

Want to see this financing option compared against every other path, with the dealer fee disclosed in dollar terms?

A free in-home assessment includes a full financing comparison. No shared leads. No commission on the financing recommendation.

Book Your Free Estimate Return to Financing Hub