How To Finance Spray Foam Insulation

You’ve read all about spray foam. You want lower energy bills, better air quality, and to be more comfortable in your home. The only problem? Spray foam insulation is out of your budget.

At South Central Services, we understand that not every customer can pay for their insulation upfront, which is why we offer financing. You may not understand how to finance your insulation, and that's okay. We are here to normalize and explain financing options.

By the end of this article, you’ll know:

• Where to get financing for spray foam insulation
• Whether you will have a down payment
• The average lifetime of a loan for spray foam
• How to tell if spray foam is worth financing

Where Do I Get Financing For Spray Foam?

There are three main ways to get financing for spray foam insulation.

1. Third-party financing companies
2. Home equity loans
3. Home improvement loans

Let's examine each of these in a bit more detail.

1. Third-Party Financing Companies

Some spray foam insulation contractors provide financing options. Providing financing options means they work with a third-party financing company. This partnership lets the contractor easily direct you to a financial service provider. The third-party company is responsible for your loan and its terms.

The financing options from an insulation contractor are like financing options at a car dealership. Car dealerships handle cars, not loans. So while a car salesperson can direct you to financing for your new or used car, the loan holder is a third-party company.

We work with a third-party financing company to offer financing options to our customers, but your preferred spray foam contractor may not. Even so, financing is still possible through loans from your personal bank.

2. Home Equity Loans

Home equity loans are a specific type of loan from lenders. These loans will only be approved if there is enough available equity in your home. Equity refers to how much of your mortgage you have paid off and how much there is left to pay.

Banks are the most common lenders for this type of loan.

3. Home Improvement Loans

Home improvement loans are usually personal loans unrelated to your home's equity.

If you want to learn more about a home improvement loan, get in contact with your personal bank. Like home equity loans, banks are the most common lenders for home improvement loans.

Frequently Asked Questions About Financing Spray Foam

If you do not have much experience with loans or home improvement projects, financing may feel confusing. Here are four frequently asked questions about spray foam financing. These questions can guide you as you contact your bank or do additional research into loan options.

1. Will There Be A Down Payment?

The financing organization determines down payments. Some third-party financing companies may require a down payment.

At South Central Services, our third-party financing company offers 100% financing. There is no money out of pocket required.

2. What Will My Interest Rate Be?

When financing spray foam, interest rates will be just like the rates of any other loan. You can expect your interest rate to match the economic climate. If interest rates have been rising overall, your interest rate will likely be higher.

Interest rates may also depend on your credit score.

3. How Long Are The Loan Terms?

Loan terms will vary depending on the financing provider. In our experience, loans have a lifetime of 2 to 10 years, with the average time to pay being 5 years.

4. How Much More Will Spray Foam Cost Me With Interest?

Interest will increase the overall cost of spray foam. However, that increase will vary depending on the loan itself, credit, lendability, and loan term. In our experience, the cost of spray foam increases by 3% to 12% when using financing options.

Is Spray Foam Insulation Worth Financing?

Deciding to pursue financing is a weighty decision. People do not want to be in debt, let alone add to the debt they are already paying back. So, how can you determine that it would be worth the debt to finance spray foam?

For some of our clients, their monthly loan payment is approximately the same amount as what they save on their energy bills.

For example, a homeowner may add a monthly payment of $100 to their expenses by financing spray foam. However, when they receive their monthly energy bill, the cost has decreased by $105. In terms of their monthly expenses, they saved $5.

No one can promise that your situation will be the same. It is worth speaking with your contractor to discuss how much they expect you to save based on the work in your home. Someone insulating their entire home will see very different results than someone insulating a small portion of their home.

If you estimate your potential energy savings to be approximately the monthly cost of the loan, spray foam insulation is worth financing. While the financial benefit may not be accessible until the loan is paid, all the other benefits of spray foam insulation can be enjoyed immediately.

So, Can I Finance Spray Foam Insulation For My Home?

Being approved for a loan will depend on your credit history, lendability, and possibly your home equity. As spray foam insulation contractors, we can only direct you to the professionals who can answer that question.

Depending on the application in your home, spray foam insulation may provide enough energy savings to match your loan payment. In cases like these, when financially accessible, financing is a beneficial choice.

Now that you understand how home improvement financing works, your next step is to:

• Estimate the cost of spray foam for your project
• Discover if you can install spray foam yourself to save money
• Learn whether spray foam insulation can fail, before you invest