The Month-18 Payment Jump (Reamortization)
Your payment is only $144 a month. When your tax credit comes in, just put it toward the loan and it stays that low.
What's actually true
The low payment is often calculated as if you will pay down about 30% of the loan early. If you don't, the loan re-amortizes and the payment can jump by 40% or more. Homeowners who buy in 2026 get no federal credit to make that paydown.
Many solar loans start with a low payment that only lasts about a year and a half. The payment is calculated as if you will pay down roughly 30% of the balance early, usually with a federal tax credit. If you don’t make that paydown, the loan “re-amortizes” and the payment goes up for the rest of the term. The CFPB described this structure in its 2024 report on solar financing, noting the reset often lands around month 19.
Why this matters more now
The structure was built around the 30% homeowner tax credit. That credit (Section 25D) ended for systems installed after December 31, 2025. So for a 2026 purchase, the assumed paydown has no natural source. If a lender still sells a loan built this way, you need $10,000 or more in cash by month 18 just to keep the advertised payment. Older loans signed in 2025 or before can still reset, especially for buyers who couldn’t use the full credit. See overstated tax credits.
A worked example
A $39,000 loan at 3.99% for 25 years.
| Scenario | Months 1 to 18 | Month 19 onward |
|---|---|---|
| You pay down $11,700 (30%) by month 18 | about $144 | about $148 |
| You make no paydown | about $144 | about $212 |
| A normal loan with no teaser | about $206 | about $206 |
Without the paydown, your payment rises about 47%. Notice the teaser payment is lower than what a normal loan of that size would cost. That gap is the clue: the low number only works if a big lump sum shows up.
Why salespeople do it
Monthly payment drives the sale. A rep comparing “$144 a month” to a $180 utility bill has an easy pitch. A rep comparing “$212 a month, or find $11,700 in 18 months” does not. If the loan also carries a dealer fee, the balance being re-amortized is inflated too.
How it shows up in the loan documents
- A Truth in Lending disclosure with a payment schedule that changes after a set number of payments
- A clause naming a “voluntary prepayment” amount, often a round percentage of the loan
- Terms like “initial payment,” “adjusted payment” or “if the prepayment is not made”
- A welcome letter or app screen showing a “target paydown” date
Questions to ask
- “Is there more than one payment amount in this loan? What are they and when do they start?”
- “What exact amount must I prepay, and by what date, to keep the first payment?”
- “What is my payment if I make no prepayment at all?”
- “Is this payment based on a tax credit? I’m buying in 2026 and get no federal credit.”
- “Can I get a fixed-payment loan instead, with no reset?”
What to do now
If you already have a loan, call the servicer and ask for your reset date and new payment. Then model it in the solar loan calculator. If you’re shopping, compare fixed-payment options and run the full picture through compare options. Our guides on solar loan dealer fees and solar financing options explain the alternatives.
If your installer or lender went out of business, see when your solar company goes under. Mosaic, a large solar lender, filed Chapter 11 in June 2025, and its loan servicing moved to a new company.
Watch out: Budget for the higher payment from day one. If the low payment only works with money you don’t have, the loan doesn’t fit.
Where to report it
- CFPB: consumerfinance.gov/complaint
- Your state attorney general’s consumer protection office
- FTC: reportfraud.ftc.gov
Related red flags
Quotes That Subtract the 30% Federal Tax Credit in 2026
The Section 25D homeowner credit does not apply to systems whose installation was completed after December 31, 2025. If you buy with cash or a loan in 2026, your federal credit is $0.
Overstated Tax Credits: "You'll Get a Check From the IRS"
The Section 25D credit only reduced federal income tax you actually owed. It was never a check. Households with little tax liability got little or nothing in year one, and some never used all of it.
Hidden Dealer Fees Behind "Low APR" Solar Loans
Low-rate solar loans are usually paid for by a dealer fee the lender charges the installer, which is added to your price. The CFPB says these fees typically run 10% to 30% of the cash price and sometimes exceed 50%.
Quotes That Show Only a Monthly Payment
A monthly payment hides the total price, the system size, the price per watt and any dealer fee built into the loan. Two quotes with similar payments can differ by thousands of dollars in total cost.
Loan Payments That Start Before the System Runs
Many solar loans start when the lender pays the installer, which can be at installation, long before the utility grants Permission to Operate. During that gap, you pay both the loan and your full utility bill.