Solar Loans in Massachusetts and Connecticut: What’s Open in 2026

What solar loan options are open in 2026?

A solar loan lets you own your system without paying the full price up front. You keep the bill savings and the owner incentives, such as SMART 3.0 payments in Massachusetts, and you repay the lender over a set term. When the loan payment is lower than what the panels save you, you come out ahead from the first month.

The options depend on where you live. Connecticut has a state-backed program, Smart-E. Massachusetts homeowners rely mostly on private lenders, with one regional program on the Cape and Islands. In both states, a home equity loan or line of credit is another route.

How does Connecticut's Smart-E loan work?

Smart-E is the Connecticut Green Bank's home energy loan. The Green Bank sets the terms, and participating local banks and credit unions make the loans. It covers more than 90 improvements, including solar panels and battery storage.

As of October 2026, the Green Bank lists these terms:

• Loan amount: up to $50,000.
• Standard rates: 6.99% for 5, 7 or 10 years, 7.49% for 12 years, and 7.99% for 15 years. Not every lender offers the 15-year term. A lower promotional rate in 2026 applies to heat pumps, not solar.
• Non-energy work: up to 25% of the loan can go to other projects, and the Green Bank names roof repairs before going solar as one of them.
• Who qualifies: owner-occupied homes in Connecticut with one to four units. Condos must be individually metered. The lender decides on credit, using factors that include your credit score and debt-to-income ratio.

To apply, you choose a participating contractor, get pre-approved by a Smart-E lender, and the contractor submits the project to the Green Bank. The contractor receives an initial third of the loan funds at closing. Because the lenders are local banks and credit unions, you deal with the lender directly for approval, which can take a little longer than an installer-arranged loan, so start pre-approval early if you are working toward an installation date. Rates and terms change, so confirm them with the lender when you apply. Connecticut owners can also pair the loan with the state's solar incentive programs.

What loan programs can Massachusetts homeowners use?

Most Massachusetts homeowners who finance solar use a private solar loan arranged through their installer, or a loan from their own bank or credit union. These are the same kind of loan, and the details that matter are the APR, the term, and any fee built into the price. Our guide to comparing solar loan rates walks through each one.

Two public programs are worth knowing about:

• The Cape & Vineyard Solar Loan. Cape Light Compact offers a 2.75% fixed-rate loan of up to $50,000 over 10 years for solar panels on year-round primary homes on Cape Cod and Martha's Vineyard. Its first phase is fully allocated, and the Compact expects to open a second phase in late 2026, pending funding. It does not cover roof work or batteries.
• The Mass Save HEAT Loan. This 0% loan of up to $25,000 covers a home battery enrolled in ConnectedSolutions, along with heat pumps, insulation and windows. It does not cover solar panels, so it helps if you are adding storage to a solar project.

Local banks and credit unions are worth a call, too. Many offer energy-improvement or personal loans that can fund solar, sometimes with better rates for members. Ask how the money is released: some lenders pay you and leave you to pay the installer, while others pay the installer in stages as the work is completed. Either works, as long as the schedule lines up with your installation contract.

Owning also keeps the Massachusetts owner incentives on your side: SMART 3.0 payments, the 15% state tax credit up to $1,000, and the property tax exemption. Our Massachusetts incentives page covers each one.

What happened to the Mass Solar Loan?

Many homeowners still search for the Mass Solar Loan. It was a state program run by the Massachusetts Clean Energy Center that helped homeowners get lower-rate solar loans from local lenders. It closed to new applications in December 2020 and has not reopened. If an offer mentions it today, ask which lender and program it actually refers to.

How do private solar loans and home equity compare?

A private solar loan is usually unsecured or secured by the equipment, so it doesn't use your house as collateral. Approval is fast, and many are arranged at the kitchen table. The trade-off is that some carry a dealer fee: a charge added to the system price to pay for a lower advertised rate. The federal Consumer Financial Protection Bureau found these fees often go undisclosed as a markup. Some lenders charge them and some don't, so ask.

A home equity loan or line of credit often has a lower rate, and there is no dealer fee. It uses your house as collateral, it can take a few weeks to close, and a line of credit may have a variable rate. It suits homeowners with equity who are comfortable borrowing against it.

How do you pick the right solar loan?

Line up your offers and check the same points on each one:

1. Compare the cash price with the loan amount. If the loan is larger than the cash price for the same system, the difference is a fee you are financing.
2. Compare the APR and the term together. A longer term lowers the payment but usually adds interest over the life of the loan.
3. Check the payment schedule. Make sure the payment you are quoted doesn't rise later unless you make a large prepayment.
4. Ask about prepayment and liens. Find out whether you can pay early without a penalty and whether the lender files a lien on the equipment.
5. Check the timing. Pre-approval, closing and the release of funds should line up with your installation date, so ask each lender how long approval takes.
6. Compare against not borrowing. A lease, PPA or prepaid PPA can make sense if you would rather not take on debt.

For how a loan fits next to the other ways to pay, see our guide to paying for solar.

Frequently asked questions