Customer Financing Options Reference

Why this reference exists

Customer financing closes 20-40% more deals on large-ticket service work (the kind that stretches a household's cash flow). Heat pumps, water heaters, full-system replacements, electrical upgrades, kitchen remodels - customers with financing options at the point of quote close at 2-3x the rate of cash-only customers. Field service businesses without financing are leaving money on the table. This reference covers the 2025 working options.

Why financing closes deals

Customer math:

• A large-ticket job spread over 5 years of monthly payments feels manageable
• The same job paid in cash is a significant one-time savings drain
• Customer monthly budget can absorb the payment; cash drain often can't

Behavioral psychology: humans evaluate purchases against monthly budget, not lump-sum savings. Financing speaks the customer's language.

For service business:

• Close rate improvement: 20-40% on financed deals vs cash-only
• Customer pays you in full at financing approval
• Financing company holds customer credit risk
• Service fee paid by customer to financing company

Major financing platforms

Wisetack (most popular small + mid contractor):

• Soft credit check (no impact on customer credit)
• 6-month to 60-month terms
• 0% APR options for promotional periods
• Interest 9.9-29% for full term financing
• Contractor pays merchant fee (3-7% typical)
• Mobile-friendly customer signup at the kitchen table

GreenSky (HVAC + remodel focus):

• Subordinate to major HVAC distributor relationships
• Promotional 0% APR (often 18-24 months)
• Longer terms available
• Contractor merchant fee

Service Finance (residential trades):

• HVAC, plumbing, electrical, solar specialist
• Promotional 0% APR
• Contractor merchant fee
• Mobile signup

Synchrony / CareCredit (home services + healthcare):

• 6-24 month promotional periods
• Specific to participating contractor networks
• Used heavily by HVAC franchises

Affirm + Klarna (consumer + smaller tickets):

• 3-12 month terms
• 0% APR promotional + interest-bearing
• Real-time approval at checkout
• Best suited to smaller tickets, well under a full-system replacement

Local banks + credit unions:

• Customer-arranged personal loan
• Contractor receives lump sum check
• No merchant fee to contractor
• Customer-side credit decision

How financing works (mechanics)

Step 1: Customer interested

Quote stage: "Would you like financing options?"

If yes: show monthly payment estimates alongside total price.

Step 2: Pre-qualify

Soft credit check (Wisetack, Service Finance, Affirm):

• Phone number + name
• No SSN required initially
• Instant pre-qualification (60 seconds)
• Soft check does NOT impact customer credit
• Shows likely approval amount

Step 3: Customer applies

Hard credit check (typically only after customer commits to project):

• SSN required
• Full credit pull
• Standard credit decision in minutes
• Approval letter

Step 4: Contract

Customer signs work agreement.

Step 5: Funding

Project completes; customer signs final document acknowledging completion.

Financing company funds contractor (typically within 24-72 hours of completion).

Some platforms fund 50% on contract signing + 50% on completion.

Step 6: Customer pays financing company

Monthly payments per terms. Customer + financing relationship is direct after this point.

Contractor merchant fees

Each platform charges a fee:

Fee comes out of contractor's payout. Customer doesn't see it.

At a 6% merchant fee, the contractor nets roughly 94 cents on the dollar of the project total. Versus losing the deal entirely on cash terms, that's still a strongly profitable trade.

Customer messaging

Where + how to present financing:

At quote:

• "Total project [price]. We accept cash, credit card, or financing."
• "Financing options: 6 months 0% APR; 60-month standard."
• "Monthly payments estimate [amount] for [term]. Soft credit check; no impact."

On marketing:

• "Easy financing available"
• "Easy 60-second pre-qualification"
• Web page dedicated to financing

On invoice + estimate:

• Financing line items + monthly payment alongside total

Promotional financing periods

0% APR for promotional period (6-24 months):

• Customer pays no interest IF balance paid before promo ends
• If balance remaining at promo end: retroactive interest from start (some plans) OR standard rate going forward
• Customer + contractor both benefit from short promotional close

Standard interest rate (typically 9.9-29%) after promo:

• Customer pays full term interest if balance carried
• Most customers prefer cash flow + accept the interest

What customers care about

Order of importance:

1. Total monthly payment (usually acceptable)
2. Promotional 0% period (12+ months strongly preferred)
3. No hidden fees
4. Soft credit check process
5. Speed of approval
6. Term length flexibility

Less important:

• Interest rate (vs monthly payment)
• Total interest paid

Customers don't math the lifetime cost; they math monthly cash flow.

Common pitfalls

• Not offering financing: lose 20-40% of large-ticket deals
• Quoting only one option: customer wants choice
• Sounding desperate ("we have to use financing"): customers feel suspicious
• Bad financing partner: declined customers blame you
• Hidden fees in financing terms: customer dispute
• No follow-up if customer's financing application stalls: deal cools
• Customer signs financing then changes mind: cancellation policies vary

Best practices

Build financing into the sales process:

• Quote always shows "monthly payment with financing"
• Customer-facing literature explains 60-second pre-qualification
• Sales team trained on financing partner options
• Customer-care follow-up on financing applications
• Track close rate by financing vs cash to validate value

Customer-side credit education

Some customers ask about credit impact:

• Soft credit check (pre-qualification): NO impact
• Hard credit check (loan approval): 5-10 point temporary dip; recovers in 3-6 months
• On-time payments: improve credit
• Missed payments: significant negative impact

Tell customers honestly. Trust earned.

Trade-specific financing focus

HVAC:

• 0% APR 18-24 month common
• Combined with IRA tax credits

Plumbing:

• Tankless, repipe, sewer
• Standard financing

Electrical:

• Panel upgrade, EV, solar interface

Solar + battery:

• Specialty solar financing (Mosaic, Sunrun)
• Often 25-year terms

Restoration:

• Insurance pays most; remaining gap may need financing

Tax credit + financing interaction

Customer gets IRA tax credit + finances the remaining:

• Project total before any credits or rebates
• Federal 25C tax credit reduces the effective cost (applied at tax time, not point of sale)
• State rebate, when available, reduces the point-of-sale price directly
• Net cost after both is meaningfully below the sticker price
• Financed: 60 months at 0% promo + standard after

Contractor benefits because gross sale + tax credit math = customer happy + can afford.

Risk + downsides

Merchant fees eat directly into margin on every financed job; a shop that finances most of its large-ticket work needs to price the fee into the estimate rather than absorb it silently. Customer credit denials create an awkward moment mid-sale, so having a fallback (a second financing partner, or a cash-with-discount option) matters. Financing partners can change terms or exit a market, so relying on a single platform is a concentration risk worth watching.

References

• CFPB consumer financing disclosure requirements
• Federal Truth in Lending Act
• State usury laws
• Financing platform documentation (Wisetack, GreenSky, Service Finance, Synchrony)
• Manuall internal: Pricing Strategy Fundamentals, IRA Tax Credits and Rebates for Home Energy - 2025 Reference