Most Popular HVAC Loan Options: What Are They, and How Do You Offer Them?

The HVAC market is ever-changing, as we’ve seen in the past five years. During the pandemic, homeowners were eager to replace their HVAC systems while they worked from home. However, over the past year or so, we’ve seen a shift into a repair market. Rising equipment and labor costs, as well as interest rates, have made new HVAC systems unaffordable for many homeowners. FTL Finance saw an almost 175% increase in Repair loans between 2021 and 2024, which demonstrates increased demand for repairs.

The key to navigating the current market is offering your customers the right payment options. As inflation affects day-to-day expenses, Americans are choosing to borrow money to afford emergencies. Staying on top of the most popular HVAC loan options can help you appeal to more customers and close more jobs.

Same-As-Cash Loans

Same-as-cash (SAC) loans, also known as deferred-interest loans, are financing options where customers owe no interest or monthly payments during a set promotional period. Promo period lengths can vary, but they typically range from 90 days to 12 months. At FTL, we offer SAC loans with 90-day, six-month, and twelve-month promo periods.

If the customer pays the loan in full before the promo period ends, they won’t owe any interest, essentially making the loan the same as paying in cash. However, interest still accrues during the promo period. So, if the loan isn’t paid in full by the end of the promo, the customer will owe interest accrued during the promo period and will continue to accrue interest until the loan is fully paid.

Same-as-cash loans appeal to customers for many reasons. For example, they may have money for the purchase soon, but not right now. They may be expecting a bonus or tax return or want to take advantage of a rebate, which they can put towards their loan during the promo period. Or, they may have recently made a large purchase and want to be able to pay for the service later without accruing interest. Even if they have the money in hand currently, they could prefer to invest it and pay the loan towards the end of the promo period to make the most out of their money.

Long-Term Loans

While SAC loans are a great option for some customers, FTL has found they’re on the decline for those with FICO scores of 750 or lower. One reason for the decline is that customers may not be able to pay off the loan during the promo period and don’t want to pay the retroactive interest. These customers are more likely to be interested in long-term loans.

Long-term loans are what you think of when you hear the word “loan.” Customers pay off long-term loans in monthly payments or installments. Repayment periods for long-term loans are typically three-to-ten years. At FTL Finance, we offer three-, five-, seven-, and ten-year installment loans.

FTL’s most popular long-term loan in 2024 was the ten-year option, which made up almost half of all loan originations. Since introducing it in 2021, we’ve seen a 400% increase in homeowners choosing this option.

Many customers choose long-term loans because smaller payments make HVAC service more affordable and free up more money for day-to-day expenses. They also typically have lower interest rates than promotional offers, like SAC loans, and credit cards.

Offering HVAC Loans to Customers

Offering financing options can seem daunting, especially when you’re trying to offer the right one. But a few tips and a little practice make the experience seamless.

One contractor who uses FTL starts by gauging his customer’s interest. He asks questions that help him determine if his customer is more interested in a SAC or long-term loan. This helps avoid a “No” when you present payment options — they can’t say a SAC option won’t work for them if you don’t offer them one in the first place.

Asking questions about their children, for example, can help you determine how much their expenses are. If they have four children, two in college and two in sports, a lower monthly payment may be better for them. There’s also nothing wrong with directly asking what kind of payment option they’re interested in.

If you listen closely enough, you may be able to gauge interest without asking questions. For example, your customer may complain that the timing is inconvenient because they recently made a big purchase or their tax return hasn’t come in yet.

Once you have an idea of what loan they may be interested in, you can prepare payment options for them. Use FTL’s project estimator to provide “good, better, best” options with their preferred loan type. Then, use choice questions to seal the deal. Asking “Which option would you prefer?” eliminates “No” as an answer, and “Would you like to pay with cash, card, or monthly payments through our financing partner?” helps you seamlessly work financing into the conversation.

The Right Financing Partner

Strategically offering popular HVAC loan options can help close sales and increase business in any market. Gauging customer interest can help you determine which loan option they may be interested in, which will set you up for success during the payment conversation.

The key is having a financing partner that can meet all of your customers’ financial needs. At FTL, we offer loan options for almost every customer. Our approval programs help us approve about 80% of applications from customers with a wide range of credit scores, so you can say “Yes” to more customers.