A dealer fee is an amount a solar lender charges the installer to offer a low advertised interest rate. The installer typically passes it on by raising the price of the system, so it ends up in your loan principal even though it may not appear as a separate line on your contract. The Consumer Financial Protection Bureau has reported that these fees are often a large share of the cash price. The practical test is to ask for the cash price and the financed price of the same system in writing, and to compare loans by the total amount you will pay, not by the advertised rate or monthly payment alone.
Related terms and pages
- Price per watt: Total installed price divided by system size in watts: the fairest way to compare quotes.
- Solar lease: An agreement to rent panels a company owns and installs on your roof, for a fixed monthly payment.
- Power purchase agreement (PPA): An agreement to buy the power from company-owned panels on your roof at a set price per kWh.
- Solar financing guide