Furnace Renting Myths and the Benefit of Financing
Replacing heating and cooling equipment in your home is a financial investment. However, when the time comes, not every homeowner is able to afford the whole replacement cost. Homeowners have two main options to lower the initial cost: furnace renting or furnace financing. These two programs are vastly different and often, renting is portrayed as the more affordable option—but there’s a lot of fine print that can mask the true cost of furnace renting.
MYTH: Renting a Furnace is Always More Affordable
FALSE. Many companies bury their rental terms and it can be hard to figure out exactly how much you’ll be paying in the long run. However, in most cases, rental companies want you to continue renting furnaces from them indefinitely and never buy out the contract.
In some instances, homeowners are tied to their rental agreements for the life of the equipment (an average of 15 years) or face an inflated buyout price. Either way you do the math, you’ll end up paying far more than market value for the heating and cooling equipment.
MYTH: Renting a Furnace Won’t Impact Selling Your Home
FALSE. Prospective homeowners don’t want to inherit rental terms from previous owners. Often, they have no choice but to continue with the rental or buyout the contract—which is an added expense that many people are not comfortable paying. Many times during negotiations, potential buyers will ask the current homeowners to buy out the equipment—decreasing the overall profit from selling your home.
Advantages of Furnace Financing
When you go with furnace financing —you’re not tied to an HVAC company like you are with renting. Your agreement is with the financing company and you have the option of servicing and/or repairing your system with any company.
In addition, the borrowing terms are clearly spelled out and you’re often able to pay off the loan at any time without penalty. Furnace renting companies increase their profit by perpetually charging you with rental fees while financing companies simply lend you the money to purchase (and own) the equipment.
HAMCO Heating & Cooling Ltd. is proud to partner with SNAP Home Finance—an industry leader in financial solutions for home improvements. If you need to replace your heating system, please consider the overall costs associated with renting your heating system and compare it to a home financing company.
If you have any questions, don’t hesitate to contact us—we’re always happy to help!
HAMCO Heating & Cooling Ltd. has been serving Hamilton and the surrounding area for over 70 years! We’re fully committed to providing reliable heating and cooling installation and repair to residential, and commercial customers.