A Solar System Can Reduce Your Cost of
Home Ownership by More Than $250,000
First time home buyers can reduce the 30-year cost of homeownership by more than $250,000 when they install a solar energy system.
Example:
A home buyer purchases a new house for $280,000 at an interest rate of 3.8% (builder financing without purchasing points)
After a 20% down payment the monthly mortgage payment would be $1048 for 360 payments. Total interest paid would amount to $172,884. And, in addition to the monthly mortgage payment there would be (on average) a $250 utility bill. Over the 30-year term of the mortgage, the utility bill (inflated at the current annual increase of 9.8%) would add an additional $135,000 to the cost of owning the home.
In sum, the cost of this traditional home ownership and electrical utility scenario would be:
$280,000 + $172,884 + $135,000 = $587,884.00
Now, here is what happens if the homeowner buys a 7 kilowatt solar system. Out of pocket cost for the solar package, if purchased and added to the total on the mortgage loan would be $33,300 and the loan would now be for $280,000 + $39,300.00 = $319,300. With 20% down the downpayment would now be $63,860, for an increase of $7,860 (versus the down payment before adding solar).
The new monthly mortgage payment would be $1,190 for 360 payments. And, this is where things get exciting. If the homeowner applies his solar energy tax credits to the loan during the first year of solar system ownership the number of payments due drops to 313 (26 years) The interest that will be paid over the life of the loan drops to $136,713 (a difference of $36,171 which almost equals the system's cost). The annual savings on utility bills will be $2,700, saving over 130,000 during the life of the mortgage.
So, If the homeowner adds $150 more to each mortgage payment (which is not a problem because he is saving $225 on utility bills each month), the loan payment schedule will drop to 259 payments(21.5 years) and total interest paid over the life of the loan will drop to $110,473.
The total benefit of taking this approach to solar energy savings is $263,773 ($319,300 + $110,473 - $36,000 - $130,000 = 263,773).
First time home buyers can reduce the 30-year cost of homeownership by more than $250,000 when they install a solar energy system!
For additional information, please contact us.
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