How Does Contractor Financing Work? A First-Time Dealer FAQ
In 2025, contractors who present financing on every job finance 35% of their sales, while contractors who only bring it up sometimes finance 17% (ACCA Contractor of the Future study, 2025). That gap is not about the customer's willingness to pay over time. It is about whether the contractor ever started a financing program in the first place.
Most first-time dealers do not hesitate because financing does not work. They hesitate because six practical questions go unanswered before they will pick up the phone: how long setup takes, who applies, what it costs them, what happens on a denial, whether they need existing volume, and whether they are locking into a contract. This post answers all six, in order, with sources.
> Key Takeaways
> - In 2025, contractors who present financing on every job finance 35% of sales vs. 17% for those who offer it selectively (ACCA, 2025).
> - Setup with a direct lender is an application, an approval, and one training session, not a months-long enrollment process.
> - The customer applies and is the borrower of record; the dealer never takes on the loan or the credit risk.
> - Eos Loan is a direct lender with no dealer fee, subject to approval and eligibility.
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How long does it take to start offering financing?
Setup with a direct lender is an application, an approval, and one team training session, not a months-long enrollment process. Contractors typically move from first inquiry to their first presented offer in days, not quarters, though the exact timeline depends on how quickly the business documentation clears review.
In practice, most of the delay first-time dealers expect never materializes. The application asks for standard business information: license, insurance, time in business, and basic contact details. There is no lengthy credit committee process on the dealer's side, because the dealer is not the one borrowing money.
A direct lender also skips a step that slows marketplace models down. Because there is no handoff between an application platform and a separate underwriting lender, there is one team to talk to, not three. For the full six-step walkthrough, including what to have ready before your first call, see the 6-step setup walkthrough.
!A contractor filling out a dealer application on a laptop in a bright workshop office.
Context for why this matters now: in 2025, US residential storage capacity reached 2.7 gigawatts, up 92% year over year (Wood Mackenzie, US Energy Storage Monitor, 2025). The pool of financeable battery energy storage, EV charger, and water filtration projects is growing fast, and dealers who are already set up to finance are the ones capturing that growth first.
Who applies for financing, the contractor or the customer?
The customer applies and is the borrower of record; the dealer never takes on the loan or the credit risk. Your role is to present the financing offer and submit the customer's application at the point of sale. The lender's role is underwriting, funding, and servicing the loan for the life of the term.
That division matters because it is the most common misconception first-time dealers bring to their first call. Some assume that offering financing means the business itself is on the hook if a customer stops paying. It does not work that way with a direct lender: the loan sits between the lender and the customer, not the dealer.
That soft pull step matters for the customer's credit. A soft credit pull never affects a customer's credit score, which is why it comes before the formal application (Credit Karma, 2026). For the full mechanics of when a soft pull turns into a hard pull, read how credit score affects financing approval.
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What does it cost a contractor to offer financing?
With Eos Loan, there is no dealer fee. Other lenders may charge a dealer fee, and the thing to watch for is not whether a rate sounds low, it is where that fee is hiding, since it is often embedded in the system price rather than shown as a line item.
Most dealer confusion about cost is not really about whether a fee exists. It is about where it hides. A lender that quotes an attractive rate can still charge the dealer a fee that gets folded into a marked-up system price, so the customer pays for it indirectly while the paperwork never uses the word "fee." Eos Loan's position is the direct contrast: no dealer fee, full stop.
!A contractor and a homeowner reviewing a project quote at a table in a sunlit room.
As CEO, the hesitation I hear most often in a first call is not "does financing work." It is some version of "what's the catch, where's the fee hiding." That question deserves a direct answer, not a redirect: Eos Loan charges no dealer fee, and we would rather a first-time dealer ask this early than find out later.
The residential clean-energy credit (Section 25D) ended December 31, 2025 (IRS, 2025), so financing, not a tax credit, is now the primary lever for closing battery energy storage projects on price. This is general information, not tax advice. Consult a qualified tax professional. For a deeper breakdown of how fee structures vary lender to lender, see how dealer fees actually work.
What happens if my customer's application is denied?
A denial does not end the deal automatically. Dealers can offer an alternative structure, a different term length, a co-signer, or a smaller project scope, and the customer is never obligated to a loan they did not receive. A soft pull first also means no score risk was taken before a real decision was made.
"Denied" usually means the customer's credit profile or debt-to-income ratio did not clear the lender's criteria at that specific term, not that financing is permanently off the table. Because a soft pull happens before any hard inquiry, the customer has not already paid a credit-score cost by the time you get a decline.
Any credit pull, soft or hard, also has a legal gate. Lenders need the customer's consent and a permissible purpose under the FCRA before pulling any credit report (America's Credit Unions, 2025). A hard pull that does happen can cause a temporary score dip, one that stays on file up to two years (SoFi, 2026), which is exactly why leading with a soft pull protects the customer while you both find out where you stand.
A decline is rarely the end of the story. For the exact soft-pull steps to run before that point, see how installers qualify customers for financing.
Do I need existing volume or sales history to become a dealer?
Direct lenders evaluate the business, license, insurance, and time in business, not a minimum monthly volume quota. First-time dealers with no prior financing history can typically qualify for a dealer program without ever having processed a single financed deal.
This is a real point of hesitation for smaller and newer shops, who assume a financing partner wants proof of scale before saying yes. That assumption holds for some marketplace-style programs that gate access behind volume tiers or existing loan-book size. It does not hold the same way with a direct lender reviewing the underlying business rather than a sales history. For the structural reason this differs, see direct lender vs. marketplace structure.
Is there a contract or minimum commitment?
Enrolling as a dealer is not the same as guaranteeing volume. A dealer agreement sets the terms of the relationship, program details, and disclosure responsibilities, not a required number of deals per month. Presenting financing on any given job stays discretionary.
That distinction connects directly back to the ACCA finding that opened this post. The 35% vs. 17% gap between contractors is not driven by a contract forcing anyone to present financing. It is driven by habit: contractors who consistently offer financing close more of it, not because they are locked in, but because they ask every time. Before signing anything, it is worth reviewing what to compare before choosing a financing partner.
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Or call +1 833-989-3737 to talk through a financing program for your business.
Quick Answers Recap
- How long does setup take? An application, an approval, and one training session, typically days, not months.
- Who applies? The customer, as the borrower of record; the dealer presents the offer.
- What does it cost the dealer? With Eos Loan, no dealer fee, subject to approval.
- What if a customer is denied? The deal is not over; alternative structures and a soft-pull-first process limit the downside.
- Do I need volume history? No. Direct lenders review business standing, not a sales quota.
- Is there a lock-in contract? No required deal volume; presenting financing is discretionary per project.
- ACCA, Inside the Contractor of the Future study: key findings from 1,000 contractors, retrieved 2026-07-06, https://hvac-blog.acca.org/inside-the-contractor-of-the-future-study-key-findings-from-1000-contractors/
- Credit Karma (Intuit), Hard vs. soft credit inquiries: what's the difference?, retrieved 2026-07-06, https://www.creditkarma.com/credit/i/hard-credit-inquiries-and-soft-credit-inquiries
- SoFi, Soft vs. hard credit inquiry: what you need to know, retrieved 2026-07-06, https://www.sofi.com/learn/content/soft-vs-hard-credit-inquiry-need-to-know/
- America's Credit Unions, Understanding permissible purpose under the FCRA, retrieved 2026-07-06, https://www.americascreditunions.org/blogs/compliance/understanding-permissible-purpose-under-fcra
- Wood Mackenzie, US Energy Storage Monitor, retrieved 2026-07-06, https://www.woodmac.com/
- IRS, Residential Clean Energy Credit, retrieved 2026-07-06, https://www.irs.gov/credits-deductions/residential-clean-energy-credit
Frequently Asked Questions
How long does it take to start offering financing as a contractor?
Setup is an application, an approval, and one training session with a direct lender, typically a matter of days rather than months. The exact timeline depends on how quickly your business documentation, license, insurance, and time in business, clears review.
Who actually applies for financing, the contractor or the customer?
The customer applies and is the borrower of record. The dealer presents the offer and submits the application at the point of sale; the lender underwrites, funds, and services the loan. The dealer never takes on the credit risk.
What does it cost a contractor to offer financing?
With Eos Loan, there is no dealer fee. Other lenders may charge one, often embedded in the system price rather than disclosed as a line item, so ask any prospective partner directly where their fee, if any, actually sits.
What happens if my customer's financing application gets denied?
A denial is not the end of the deal. You can offer a different term, a co-signer, or a smaller project scope. Because a soft pull comes first, no score was risked before that decision was made (Credit Karma, 2026).
Do I need existing customers or sales volume to become a dealer?
No. Direct lenders typically evaluate business standing, license, insurance, time in business, not a minimum monthly volume quota, so first-time dealers can generally qualify without prior financing history.
Is there a contract or minimum commitment to join a financing program?
A dealer agreement sets program terms and disclosure responsibilities, not a required deal volume. Presenting financing stays discretionary per project; consistency, not a contractual quota, is what drives more financed sales.
The bottom line
Six questions stall most first-time dealers before they make the call: setup time, who applies, cost, denials, volume history, and contract terms. Every one of them has a straight answer, and none of them is a reason to wait. In 2025, contractors who present financing every time close 35% of sales financed vs. 17% for those who bring it up occasionally (ACCA, 2025).
If you are ready to see what a program looks like for your business, talk to our team about becoming an Eos Loan financing partner. All financing is subject to approval and eligibility, and Eos Loan is a direct lender, never a marketplace or broker.
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