Best HVAC Loans of April 2024

If you need to replace your heating, ventilation, and air conditioning (HVAC) system, you probably want to get it done as soon as possible. But you may also have concerns about the cost of HVAC replacement, which averages about $7,000, according to HomeAdvisor. That’s enough to make you sweat (or shiver) even more. 

We’ll cover the best HVAC financing companies and help you compare your options, so you can choose the best loan for your needs. Your thermostat will thank you. 

Compare HVAC financing rates of April 2024

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• Appliance Financing
• Best Roof Financing
• Best Deck Financing
• Best Landscaping Loans

Best HVAC financing companies

The best loans for HVAC financing get you the money you need quickly and are offered by reputable companies. All the lenders below can deliver funds either the same business day you apply or the next. Prequalify to see which lenders are most likely to approve your loan and at what rate. 

Prequalification won't hurt your credit score, and can help you narrow down the best loans for your situation and financial profile. Note how soon lenders can deliver you funds, and compare annual percentage rates (APRs) to see the true cost of borrowing. Note that once you complete a full application, the lender will run a hard credit check, which could temporarily lower your score.

SoFi: Best overall

Discover: Best for no origination fees (and low rates)

LightStream: Best home improvement loans and low rates

Upgrade: Best for fair credit

Reach Financial: Best for fast funding and fair credit

OneMain Financial: Best bad credit personal loans

Best Egg: Best for high close rates if pre-approved

Avant: Best for all credit types

Upstart: Best fast personal loans for all credit types

Methodology

Credible evaluated the best personal loan lenders for HVAC financing based on factors such as customer experience, minimum fixed rate, maximum loan amount, funding time, loan terms, fees, discounts, and whether cosigners are accepted. Credible’s team of experts gathered information from each lender’s website, customer service department, in-house resources, and via email support. Each data point was verified to make sure it was accurate at the time of publication.

Learn more about how Credible rates lenders by exploring our Personal Loans Lender Rating Methodology.

What is HVAC financing?

HVAC financing is any type of loan, line of credit, or credit card used to pay for an HVAC system. Many homeowners can’t afford to pay for the cost of an HVAC system upfront. Fortunately, there are a variety of types of HVAC financing available.

As you explore your options, keep in mind that certain energy-efficient systems may be eligible for federal income tax credits that can reduce the cost of a new system by up to 30% or $3,200 (whichever is lower). Also research tax credits and rebates offered by your city, state, and energy company. 

Types of HVAC financing 

You have several options for financing your new HVAC system, including:

• Personal loans: Personal loans provide a sum of money upfront to replace your HVAC system, which you repay in fixed monthly installments over a period of years. Some have repayment terms for up to 12 years, depending on the lender. While personal loan rates range from the single digits to over 30%, the average rate on a 24-month personal loan was 12.49% as of February 2024, according to the Federal Reserve.  
• Home equity loans: Home equity loans let you tap the equity in your home. They tend to come with lower rates and longer terms than personal loans, because your home’s equity is used as collateral. But home equity loans can have high closing costs, unlike some other types of HVAC financing, like personal loans. You also risk foreclosure if you can’t make your payments.  
• Credit cards: While credit cards often have high interest rates, you may be able to qualify for a 0% introductory APR offer on a new card. This could give you up to 21 months to repay the cost of your HVAC installation without interest. Just make sure you can pay off the balance before the promotional period ends if you want to avoid interest payments. 
• Manufacturer or contractor financing: Your HVAC contractor may offer financing options, either through a partnership with a lender or through the HVAC manufacturer. These options may have a low-interest or interest-free period, depending on the company. 
• FHA loans: Government-backed loans can also help with HVAC financing. For example, the Energy Efficient Mortgage program, which is available for energy-efficient improvements if you’re purchasing or refinancing your home, and the Title 1 Property Improvement Loan program are available through mortgage lenders that are Federal Housing Administration-approved or approved to make Title 1 loans, respectively. 
• State loan programs: Some states sponsor low-interest loans for energy-efficient home improvements through local credit unions. Research options in your state.

Related: 0% APR Credit Card vs. Personal Loan

How to compare HVAC loans

When comparing HVAC financing options, it’s important to consider the following:

• Loan amounts: Some loan types and lenders offer higher loan amounts than others. Look for lenders that offer the amount you need to fund your HVAC purchase and installation. 
• Repayment terms: Consider how long you’ll need to repay the loan. Generally, a shorter term will save you money on interest, while a longer term can keep your monthly payment low. 
• Fees: Some personal loan lenders charge origination fees, and home equity loans come with closing costs. Consider these and other fees when comparing your options, and be sure to avoid lenders that charge prepayment penalties. 
• Cosigner option: If you have bad credit, you may need help qualifying for an HVAC loan. A friend or relative with good credit can cosign the loan, which could make it easier for you to qualify or reduce your interest rate. But it also makes them fully responsible for the loan if you can’t make the payments. If you go this route, make sure the lender allows cosigners. 
• Time to fund: Time is of the essence when you’re surviving hot or cold temperatures. Some loan types, like manufacturer financing, may be instant, and some personal loan lenders can offer same-day financing. But others, like a home equity loan, can take more than a month to fund. Consider how quickly you need the money when choosing a loan type and lender. 
• APR: The annual percentage rate (APR) shows how much you’ll pay annually to borrow the money, including interest and fees. Once you narrow down your options based on eligibility and the loan terms you need, choose the lender that offers you the lowest APR. Prequalify with multiple lenders to compare APR estimates on personal loans. 

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Eligibility requirements for HVAC loans

The eligibility requirements for HVAC financing vary depending on the loan type you choose and the lender. For a personal loan for HVAC installation, you’ll need to meet the lender’s criteria, which generally includes:

• Minimum credit score: Many lenders require a good credit score, which is a FICO score of 670 and above. But some lenders have more lenient requirements than others and will approve loans for fair-credit and even poor-credit applicants, especially if you apply with a cosigner or offer collateral, like you would with a home equity loan or a secured personal loan.
• Income requirements: Lenders will check your annual income when approving you for a loan, and many have minimum income requirements. You’ll generally need a verifiable source of income to get a personal loan. 
• Decent payment history: Lenders tend to check your credit report for late or missed payments. These can hinder your ability to get a loan or increase your rate. 
• Maximum debt-to-income ratio (DTI): Your debt-to-income ratio shows how much of your monthly income you spend on debt repayment. If it looks like you’re already struggling, you might not qualify. Some lenders have a specific maximum DTI, such as 35%. 

HVAC financing for bad credit

Getting an HVAC loan with bad credit can be a challenge. Start by comparing lender requirements and prequalifying for bad-credit personal loans. If you’re not eligible for any of the options, consider applying with a cosigner or choosing a loan that requires collateral. Secured loans are often easier to qualify for, though fewer lenders offer them.

Still no luck? Consider no-credit-check loan options, such as a 401(k) loan or life insurance policy loan, or ask friends and family for help. You can also take steps to improve your credit score and boost your savings. A portable air conditioner or space heater can provide comfort in the meantime.

FAQ

How does HVAC financing work?

HVAC financing provides you with the money you need to pay for your HVAC replacement or installation if you can’t afford the cost upfront. You’ll need to repay the loan over time, often with interest, depending on the borrowing method you choose. Compare the APR, terms, closing costs, and requirements of different HVAC financing options before making a choice.

What credit score do you need to finance an HVAC system?

There’s no specific minimum credit score needed for HVAC financing, since different loan types and lenders have different requirements. Having a good or excellent credit score will provide you with more options and lower rates. However, it’s possible to qualify for a personal loan with bad credit.

How can I qualify for tax credits when replacing my HVAC system?

In order to qualify for federal income tax credits under the Inflation Reduction Act, you’ll need to install certain qualifying energy-efficient equipment in your home. For example, installing an energy-efficient heat pump allows you to claim a tax credit of up to 30% of the cost, up to $2,000 per year. More details are available at Energy.gov. Bear in mind that your state or city may have a separate program as well. 

Loan Amounts:

• $2,000 Loan
• $1,000 Loan
• $5,000 Loan
• $10,000 Loan
• $30,000 Loan
• $40,000 Loan
• $45,000 Loan
• $60,000 Loan
• $80,000 Loan
• $100,000 Loan