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We provide capital leases for businesses looking to add solar without paying for the project out of pocket.

What kind of finance does Providence Capital provide for solar?

We provide capital leases for businesses looking to add solar without paying for the project out of pocket.

What is a capital lease? Is that the same as financing?

Correct. In a capital lease, we pay the installer the cost of the installation and the customer then makes payments to us.

Does the customer own the equipment, or are they just renting it from you?

They will own it at the end of the term. During the term, they receive all of the advantages associated with ownership. They receive the 30% investment tax credit and take the full depreciation. This is an asset on their balance sheet, and they get to write off the interest from the lease.

How long are the terms?

Terms range from five to seven years, depending on the size of the transaction and the customer credit profile. We work with multiple underwriters, so there are different options. In general, for systems under $100,000 the term is up to 60 months and for systems over $100,000 we can do an 84-month term.

Is Providence Capital a direct lender or a broker?

Both. We have a team of credit managers with more than 100 years’ experience in commercial leasing, and we do most of the credit review and underwriting in-house. We do also have a private warehouse line available.  We are the source of contact, the leases are written on our documentation, and we service the lease for the entire term. Our underwriters will issue payment and facilitate the billing.

What system sizes do you finance?

We do systems as small as $50,000 and have done systems close to $3.5 million. Approximately 75% of our transactions are under $750,000.

Sounds great! How long does the approval process take?

For transactions under $250,000, we can usually approve in 48-72 hours. For transactions up to $750,000 it would take about a week, and for anything over that it could take 2-3 weeks for full approval.

How do businesses find you?

About 95% of our clients are referred by contractors or solar brokers. They present a project to a customer, the customer sees the benefits and wants to move forward but doesn’t want to finance internally, and the contractor refers the customer to us.

And then what is the process?

The contractor will have us reach out to the customer and provide an overview, and if it’s a good fit then we will request a financial package to proceed so we can review credit and issue a proposal.

What kind of financial package?

We will request a few years  of personal and corporate tax returns, depending on the project size and we will do a soft inquiry on the business owner’s credit.

Is this a business or personal lease?

The owner will guarantee the lease, but it will be processed under the business. The lease will not be on the owner’s personal credit.

What kind of businesses are you looking for?

We work with owner/operators. The user of the solar must also be the person or business qualifying for the financing. Generally, we’re looking for companies with 5+ years in business and a positive cashflow.

What are you looking for to approve a customer?

It all depends on which underwriter the lease is placed with. For the transactions over $250,000 we are focusing on the profitability and cashflow of the business and owner. We take a lot of things into account. It’s really case by case.

What industries do you work with?

All kinds of businesses. Hotels, commercial property owners, manufacturers, restaurants, dealerships, medical offices. I would say the ones we don’t work with are non-profits, because they can’t use the tax credit, or home owners associations.

Do you only work in California?

No, we actually finance projects nationwide. We just wrapped up an auto shop in San Diego, a commercial retail building in New Jersey, and a print shop in Michigan. We also have multiple commercial developments in Phoenix in the works.  I will say I have yet to do Alaska or Hawaii—but that’s not to say we wouldn’t.

What is the best way to contact you"?

That’s a great question! Email me at <a href=”mailto:[email protected]”>[email protected]</a> or call me directly at (714)985-6207.