Lease vs PPA vs Cash for NJ Solar: The Honest ComparisonSolar Broker vs Installer: The Honest NJ Homeowner’s Guide for 2026What Happens When Your Solar Installer Goes Bankrupt: PosiGen, Sunnova, and Your Options

The financing question is the one where the most money gets quietly given away. I’ve seen smart homeowners with solid credit sign 25-year lease agreements with 2.9% annual escalators when a 12-year loan would have netted them $40,000 more over the life of the system. The reason it happens isn’t because anyone’s lying — it’s because the four financing options aren’t really comparable on a one-page brochure, and most installer salespeople pitch the option their commission structure rewards.

Here’s the version of this I walk every client through, with the 2026 tax-policy changes folded in.

The four options, side by side

The 25-year totals are real-world ranges across my client base. The lease/PPA totals look higher because the escalator compounds — even a 2.9% per-year increase doubles the payment over 25 years.

The 2026 federal tax credit repeal

This changed the calculus meaningfully on January 1, 2026. The One Big Beautiful Bill Act (Public Law 119-21, July 2025) repealed Section 25D — the residential side of the federal Investment Tax Credit. Pre-2026, a cash or loan buyer claimed 30% of the system cost as a tax credit. Post-2026, they can’t.

However, Section 48E (the commercial-side ITC) is still in effect. Lease and PPA companies install the system, capture the 48E credit on their commercial tax return, and (theoretically) pass some of that benefit to the homeowner through lower monthly payments. In practice, lease/PPA companies have not dropped their monthly rates by the full 30% — most have used the credit to improve their own margins or offset their cost of capital.

What this means for choosing financing

• Cash and loan buyers: you lost the 30% federal credit. The math is still favorable in NJ because of SREC-II and 1:1 net metering, but payback shifts from ~5 years to ~7–9 years.
• Lease and PPA customers: the lease company captures the credit instead of you. You may see modestly lower monthly payments because of it (or you may not, depending on the company).

If you have low or zero federal tax liability — retirees with mostly Social Security income, for example — the credit repeal doesn’t change anything for you personally. You couldn’t have used the 25D credit anyway. For those folks, the lease/PPA math hasn’t shifted relative to cash/loan.

Cash: the simplest, the most efficient

If you can write a check for $20,000–$28,000 without straining cash flow, cash is the lowest-friction path. You own the system from day one, you keep every dollar of bill savings and SREC income, and you have no contract counterparty to manage. The trade is the upfront commitment.

I do not push cash. About 30% of my clients pay cash. The rest finance — that’s the median NJ homeowner profile.

Solar loan: the path I recommend most

A solar loan is a standard secured or unsecured loan (depends on lender) with a 10–25 year term and a fixed rate. The homeowner is the borrower. The installer is paid in full at install. The lender holds the lien (if secured) or the unsecured note.

Why I recommend loans most:

• You own the system from day one (loan is paid off as you go).
• You keep the SREC income — usually $760–$950/year on an 8.4 kW system.
• Your monthly payment is fixed. No escalator. Predictable for budgeting.
• The system adds ~9.9% to home value (per Zillow / NJ-specific NREL data) — that equity is yours.
• If you sell the home, you pay off the loan from sale proceeds. The buyer gets a paid-off, owned solar system — easier negotiation than a transferred lease.

The downsides: you need decent credit (typically FICO 700+, some lenders go lower with higher rates). And you do pay interest over the loan life. The interest cost is usually $4,000–$8,000 over 15 years — modest relative to the system’s total income.

Lease: the predictable monthly model

A lease is a 20–25 year agreement where the lease company owns the system and you pay them a fixed monthly amount. The lease company is responsible for maintenance, warranty, and repairs. You consume the electricity the system produces (you save on your utility bill). The lease company keeps the SRECs (almost always) and captures the federal tax credit.

Where a lease can make sense:

• You have no upfront capital and don’t want a loan.
• Your federal tax liability is low (so you couldn’t have used the 25D credit pre-2026 anyway).
• You value zero-touch ownership — somebody else handles every issue that comes up.
• You don’t plan to sell the home for at least 8–10 years (lease transfers are real but they add friction to a sale).

The escalator clause is the single most important thing to review. A 2.9% escalator on a $130/month base means you’ll be paying $267/month in year 25. Compounded across the contract, that’s $52,000 in payments. Some leases offer a flat (no-escalator) structure — those are the ones I recommend if you choose the lease path. NJ Attorney General settlements with several solar companies have specifically cited undisclosed or misrepresented escalator terms as a consumer-protection violation.

PPA: pay per kWh produced

A power purchase agreement is similar to a lease, but instead of a fixed monthly payment, you pay a per-kWh rate for the electricity the system produces. Typical NJ PPA rates as of 2026 are $0.12–$0.15/kWh — below the retail $0.21–$0.26 you’d pay otherwise.

The structural difference from a lease: under a PPA, your monthly cost varies with how much sun the system gets. A cloudy month means a lower bill from the PPA provider. A bright sunny month means a higher one (but still well below retail).

PPAs in NJ have the same caveats as leases: escalator clause (usually 1.99–2.9%), SREC assignment to the provider, and contract-review issues. They’re slightly more complex to compare because the per-kWh structure makes apples-to-apples math harder — be sure the salesperson is showing you projected total payments over 25 years, not just the first-year rate.

Who keeps the SRECs?

This is the line item I see most often misunderstood. The default by financing type:

• Cash, loan: You keep the SRECs. The income flows to your account quarterly via your installer’s GATS aggregator (see my SREC-II post). $760–$950/year on a typical system.
• Lease, PPA: The financing company keeps the SRECs. They use the income to subsidize their own balance sheet, then pass through a portion (or not) via the monthly payment level. Some leases do pass SRECs to the homeowner. The only way to know is to read the contract — look for “SREC ownership” or “Solar Renewable Energy Certificate” language.

If a salesperson tells you “you keep the SRECs” on a lease, ask to see the contract line. If it’s not in writing, it’s not real. This is a common source of disappointment 6 months in.

What if you move?

Real-estate agents in NJ tend to prefer owned-solar homes over leased — easier negotiation and clearer chain-of-title. Doesn’t mean leased solar can’t sell, but it’s a real-world detail I flag for any client whose 5-year plan includes selling.

The honest decision matrix

If you fit one of these profiles cleanly, here’s what I usually recommend:

• 700+ FICO, planning to stay 10+ years, has some federal tax appetite: solar loan. The math is best.
• $20K+ cash available, doesn’t want monthly payments: cash. Simplest.
• Below 650 FICO, can’t access loan rates that work: lease, but flat-escalator only.
• Retired, low federal tax, doesn’t want O&M responsibility: PPA or lease (escalator-flat preferred).
• Planning to sell within 3 years: probably wait, or buy cash. Solar payback won’t materialize in time, and lease/PPA transfer adds friction to the sale.

Bottom line, in plain English

The 2026 federal tax credit repeal made cash and loan buyers slightly worse off, and lease/PPA companies slightly better off in relative terms. NJ’s state-level incentives (SREC-II, 1:1 net metering, sales-tax exemption, property-tax exemption) are still strong enough that any of the four paths can work — the question is which one fits your cash flow, your credit, and your time horizon. The single biggest financial mistake I see is signing a lease or PPA without reading the escalator clause. The single biggest relational mistake is signing any contract without an independent review of the contract — which is most of what a broker does.

I’ll lead with the conflict of interest: I am a solar broker. Installers pay me a referral fee when a client I send over signs a contract. So the bias in this post is real, and you should weigh it accordingly. The reason I’m still writing this post is that the honest comparison also happens to be the comparison that explains why most of my clients found me after going direct first.

The three paths

Every NJ homeowner who buys solar walks one of these three roads:

1. Direct to a single installer

You call Sunrun, Tesla, Solar Landscape, Trinity, or one of the dozen NJ-licensed regional installers. They show up, do a site survey, and quote you their product on their financing. They have one product to sell — theirs — and their salesperson’s commission is structured around closing you on it.

Pros: direct accountability, no middleman, in-house installation. Cons: only one quote, contract written by their lawyers, no independent review of the math.

2. Lead-gen aggregator

You enter your info into a “compare solar quotes” website. EnergySage, Solar.com, Modernize, SolarReviews, and dozens of clones operate this model. Your info gets resold (usually to 3–5 installers) and the installers compete to call you.

Pros: multiple quotes. Cons: you become a “lead” — typically 3 to 8 calls in 24 hours, often longer-running call/text harassment. None of the aggregators review the contracts. Many sell to installers with a wide range of quality. NJ Attorney General settlements with Momentum Solar and other companies have repeatedly cited high-pressure phone tactics and undisclosed contract terms that originated downstream from lead-gen sites.

3. Independent broker

You work with a single licensed advisor (like me) who pre-vets installers, shops the market, brings you 2–3 competing quotes from a curated list, walks the contract with you line by line, and stays involved through install and beyond. The installer pays the broker — the homeowner pays nothing extra.

Pros: independent advice, contract review, no markup. Cons: the broker is still paid by installers, so the affiliate-disclosure side matters; if the broker isn’t disclosed and licensed, you’re back to lead-gen territory.

The incentive structure, plainly

The lead-gen model is the only one where the homeowner is the product — your contact info is what gets sold. The installer-direct and broker models both have the homeowner as the customer.

How a broker is paid — the FTC side

Brokers operate under FTC 16 CFR Part 255, the federal rule on endorsements and affiliate connections. The June 2023 update to that rule clarified two things:

1. Any material connection between an endorser and the endorsed party must be clearly and conspicuously disclosed on every page where the endorsement appears.
2. The disclosure must use language a typical consumer can understand — no fine-print hedge.

You’ll see my own disclosure at the top of every page on this site (“How I get paid: Installers pay me a referral fee when you sign — never you. Full disclosure →”). That’s the FTC-compliant version. If you visit a “broker” site and can’t find the equivalent disclosure on the same page where they recommend an installer, that’s a problem — not just from a regulatory standpoint, but because it tells you their business model isn’t transparent enough to disclose.

The contract review question — where brokers earn their fee

This is the part of the broker model that, in my experience, makes the most difference. Installer contracts are 25-year documents written by installer lawyers for installer protection. The ones I read most often have:

• Escalator clauses on lease/PPA terms — typically 2.9% annual. Over 25 years, a 2.9% escalator means you’ll pay 2x in year 25 what you paid in year 1.
• SREC assignment language — some lease/PPA agreements quietly assign the SREC stream to the installer, then call their own capture a “production guarantee.” I wrote about this in the SREC-II post.
• Transfer-on-sale conditions — most are reasonable but the credit-qualification language varies.
• Warranty exclusions for “acts of God” — the language is broad enough that some hail-damage scenarios end up uncovered.
• System-removal clauses if you sell — typically 30 to 60 days notice required.

An installer’s salesperson will not walk you through these line by line — they’re trained to close, and the contract is rarely the closing tool. A broker who isn’t reading the contract isn’t earning their fee.

What good looks like, by example

A broker in NJ doing the work properly should:

• Hold a real BBB profile under their own name (not the installer’s name), with at least an A rating and no unresolved complaints. Mine is at A+ since 2024.
• Disclose how they’re paid on every page where they recommend an installer. (Not buried in a footer.)
• Bring you 2 to 3 quotes from different installers, not different financing options from the same installer.
• Sit with you while you read the contract — physically or on a screen-share — and explain every clause you ask about.
• Have a vetting standard for installers in writing. (Mine is 4 criteria, public on the partners page.)
• Be the person you call after install when something goes wrong — not the installer’s customer-service line.

What bad looks like — and the NJ AG paper trail

For honest pattern-matching, look at the recent NJ Attorney General consumer-protection actions in the solar space:

• Momentum Solar settlement (2022) — $1.5M settlement for high-pressure sales tactics, unclear contract terms, and consumer-protection violations across NJ.
• Multiple consent orders against door-to-door solar sales operations citing failure to disclose lease vs purchase, undisclosed escalator clauses, and misrepresentation of state incentives.
• BBB complaint databases show systemic issues with several large national installers in the NJ market — installers I have deliberately excluded from my referral pool.

You can pull these records up yourself in 10 minutes. If a “broker” can’t tell you what their installer-vetting criteria are, or which installers they’ve removed and why, that’s a signal worth taking seriously.

Bottom line, in plain English

If you know exactly what you want, can read a 25-year solar contract by yourself, and only want one quote — go direct to an installer you’ve already vetted yourself. That’s a reasonable path.

If you want comparison quotes and contract review and someone to call after install when the inverter fault light turns on — work with an independent broker who discloses how they’re paid. The cost is the same (the installer eats it from their margin) but the contract you sign will be different.

Lead-gen aggregators are the model I’d avoid. The harassment alone is enough; the lack of any post-sale advocacy seals it.

One of the harder conversations I’ve had with clients in the past 18 months: explaining what happens when the company that put solar on their roof — and that they’re paying $130 a month to for the next 22 years — files for bankruptcy protection. It’s not a hypothetical anymore. Two large residential solar lease/PPA companies that operated in NJ have gone through financial distress events in 2025–2026, and the contractual mechanics for affected homeowners are not what most people assume.

The recent NJ track record

I’ll lead with the public record:

• PosiGen — February 2026 transition. PosiGen, a Louisiana-based lease/PPA provider that operated in NJ since 2018, restructured under a creditor agreement and transferred its NJ servicing portfolio to a successor servicer. NJ homeowners on PosiGen leases received an assumption-and-assignment notice. Monthly payment terms were preserved. Warranty servicing was reassigned to the successor.
• Sunnova / SunStrong — ongoing. Sunnova, a publicly-traded residential solar provider, filed Chapter 11 in 2025; portions of its lease/PPA portfolio (including the NJ portion) have been sold to SunStrong Capital Services. Existing customer contracts were assumed under the sale order. SunStrong now handles billing and Tier-1 service.

(Sources: Sunnova SEC filings; PosiGen public corporate notices; NJ Division of Consumer Affairs filings.)

What actually changes for the homeowner

In a Chapter 11 reorganization or an asset-sale scenario for a solar provider, your contract becomes one of the assets the trustee or successor company has to dispose of. The standard outcomes:

1. The contract gets assumed by the successor servicer

This is the most common case. Your lease or PPA contract is assigned to a new company. The terms — monthly payment, escalator, term length, transfer-on-sale provisions — all stay the same. You get an assumption-and-assignment notice telling you who to send payments to going forward. This happened to most PosiGen customers in NJ in early 2026.

2. The contract gets rejected

Rare for solar leases (the income stream is too valuable to throw away), but possible. If your contract is rejected, you keep the panels on your roof but the obligation to pay terminates. You’re then responsible for any maintenance, repairs, and SREC paperwork going forward — which can be a meaningful cost if the inverter or panels fail.

3. Warranty support degrades

This is the one homeowners feel the most. The original installer’s workmanship warranty (typically 10–25 years covering roof leaks, racking issues, electrical defects from the install itself) almost never transfers cleanly to a successor servicer. They’ll typically take over service-call dispatch but the warranty coverage gets quieter.

The manufacturer warranties (panel performance, inverter performance) generally do survive, because those are between you and the manufacturer (LG, REC, Enphase, SolarEdge, Tesla) — not between you and the installer. So your panels are still under their 25-year power output warranty.

What changes for different contract types

If you’re already in this situation

What to do, in order:

1. Read your assumption-and-assignment notice carefully. It will tell you (a) who the successor servicer is, (b) where to send payments going forward, (c) where to direct warranty calls, and (d) the deadline for objecting (typically 30 days from notice).
2. Save every document related to your install. Original contract, system specs, inverter and panel serial numbers, any warranty certificates. Manufacturer warranties are claimed via serial number — you’ll need that data when the installer’s not around to look it up for you.
3. Verify your SREC stream. If your SRECs were being aggregated through the original installer, check that the successor is still pushing them to PJM GATS under your system’s account. This is the #1 thing that quietly breaks in transitions, and the only way you’ll catch it is by logging into your GATS account and checking that new certificates are showing up.
4. Document the system’s pre-transition condition. Walk the roof (or have a roofer do it). Photograph any visible wear, racking, conduit. If the workmanship warranty turns out to be unrecoverable later, you’ll want a record of where things stood at the moment of transition.

How to evaluate installer financial stability before signing

This is the broker’s job, but if you’re shopping direct, here’s the checklist I use:

• Public 10-K and 10-Q filings — for publicly-traded installers (Sunnova, Sunrun, NextEra), pull the most recent quarterly filing from SEC EDGAR. Look at: net income (positive vs. negative), operating cash flow, long-term debt, and any going-concern language from the auditors. A residential solar provider burning cash with negative operating cash flow and rising debt is a flag.
• BBB rating and complaint volume — a sudden spike in BBB complaints is often the first public signal of operational stress.
• NJ Division of Consumer Affairs filings — search the NJ DCA database for the installer’s name. Active consumer-protection actions or open complaints are public record.
• Years in business — the residential solar industry has a high churn rate. An installer with 10+ years of operation and continuous NJ presence is statistically more stable than a 2-year-old company growing fast on lead-gen spend.
• Concentration risk — if an installer is doing 90% of their business in one financing partner’s product (e.g., one lease company), and that financing partner gets into trouble, the installer often follows. Diversified installers ride out individual partner failures better.

I run this checklist on every installer in my referral pool, every quarter. It’s the unsexy part of brokering — but it’s why none of my clients in 2024 or 2025 were in the PosiGen NJ pool that got transitioned in February 2026.

The broker advantage on this specific risk

Honest disclosure: this is one of the strongest arguments for working with a broker, and I’m aware that’s self-serving. The mechanics:

• I refresh my installer roster monthly based on financial-stability data.
• When an installer’s BBB complaint volume rises, I pause new referrals to them before I see them in the news.
• I keep written records of which installers I’ve removed and why — clients can see that list (I share it on request).
• If a client’s installer later runs into trouble, I help them navigate the assumption-and-assignment process — even though the referral fee for that install was paid out years earlier and I have no further commercial interest.

A direct-to-installer sale, by contrast, leaves you fully exposed. The salesperson who closed you is rarely the one you’ll be calling four years later when something changes.

Bottom line, in plain English

An installer going bankrupt usually doesn’t mean losing your panels or your contract. It does mean a quieter warranty experience, a worse customer-service desk, and a real chance that something will quietly break — usually SREC aggregation — that nobody tells you about. If you already have a lease or PPA with a company in trouble, read the assumption-and-assignment notice and verify your SREC stream. If you’re shopping new in 2026, financial-stability vetting is part of the due diligence — whether you do it yourself or work with a broker who does it for you.