Replacing or repairing air conditioning and heating systems can be expensive, even for moderate-income households. The expense often comes as an unexpected one when HVAC systems abruptly experience an issue that requires immediate attention.
If you find yourself in urgent need of repairing, upgrading or replacing an HVAC system, but you do not have the savings or are able to pay out-of-pocket, keep in mind there are a number of financing options available for people in various situations
Are Credit Cards a Viable Answer?
Most people are accustomed to using credit for a number of purchases each month. One option to consider for such a significant purchase as HVAC repairs or replacement is acquiring a new credit card with a promotional 0 percent APR. Be aware, however, that you need to be able to pay off the balance within the promotional timeframe, or the credit card will revert to standard APR—charging significant interest on the remainder until it is paid in full. You also generally need to have a fairly good credit score to obtain low-interest or 0 percent credit cards.
If you are purchasing the HVAC unit yourself from a large home improvement store, you may also consider using their credit program. When you sign up for a credit card with a chain store, they sometimes offer incentives, such as a 0 percent APR for a period of time.
Is a Loan the Right Answer for You?
You also have the option of applying for a couple different types of loans. The first is a home equity loan, which is secured against your property, or by the deed to your mortgage loan. Home equity loans, which often are used by homeowners for improvement projects, typically come with lower interest rates than credit cards. On the other hand, personal loans—another financing option for projects that costs a few thousand dollars—do not have to be secured by your property, but they generally have higher interest rates. You can talk to a financial institution, including banks and credit unions, about taking out a personal loan.
Does the Service Provider Offer Financing?
Many contractors and HVAC manufacturers can offer payment plans or help you arrange financing through a lending agency with which they partner. This can be a beneficial option, particularly if you are familiar with the company and trust they will complete the work, even after being paid upfront by the lender. Regardless, make sure to read the fine print in the contract and compare the rates and fees to those associated with other financing options. Residential and commercial customers should check with the company doing their HVAC installation or repairs to see what financing options are available through them.