How to Choose a Financing Partner: A Contractor's Due Diligence Checklist
A dealer fee alone tells you nothing about whether a financing program is good or bad. In 2023, the Consumer Financial Protection Bureau found that some lenders "cram" markup fees into solar loans, raising total cost 30% or more above the cash price (CFPB, 2023). Most contractors sign up for a program based on the rate they hear on a sales call, then discover the real fee structure, funding delays, or lender instability only after they have already committed customers to it.
This guide is a due-diligence checklist covering the 6 areas that actually determine whether a financing partner helps your business or quietly costs you deals: dealer-fee transparency, lender structure, approval speed, term flexibility, multi-vertical coverage, and funding reliability. Run any prospective partner, including Eos Loan, through it before you sign.
> Key Takeaways
> - Six checks decide whether a financing partner helps or hurts your business: dealer-fee transparency, direct lender vs. marketplace structure, approval speed, term flexibility, multi-vertical coverage, and funding reliability.
> - The CFPB found some lenders cram markup fees into solar loans, raising cost 30%+ above cash price (CFPB, 2023).
> - Lender stability is not theoretical: Mosaic paused loan originations in May 2025 before its Chapter 11 filing in June 2025 (Solar Power World, 2025), stranding contractors mid-project.
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Why does the financing partner you choose matter this much?
In 2025, US residential and utility-scale storage installations hit 18.9 GW, up 52% over 2024 (Wood Mackenzie, 2025). More contractors are evaluating financing programs than ever, and more programs are competing for their installs. That growth raises the stakes of picking wrong.
A bad financing partner rarely announces itself upfront. It shows up later, as a lost deal because approval took three days instead of three minutes, a lost margin because the dealer fee was buried in a marked-up system price, or a lost project mid-install because the lender ran out of funding. Each failure mode maps to one of the checklist items below, which is exactly why a single "what's your rate" question does not protect you.
!A contractor reviewing financing program documents on a tablet at a bright office desk in daylight
With installed volume up 52% year over year, the number of contractors relying on financing to close deals keeps growing (Wood Mackenzie, 2025). The checklist below is the fastest way to separate a program that will hold up under that growth from one that will not.
Most contractors treat financing-partner selection as a one-time decision made early, then never revisit it. That is a mistake. A program that looked fine at 20 installs a year can strain at 100, funding delays that were once rare become a weekly headache, and a dealer fee you never confirmed in writing can quietly erode margin on every single deal. Re-running this checklist annually, or any time volume jumps, catches problems before they compound.
How transparent are the dealer fees?
A dealer fee is the discount a lender takes when it funds a loan, and it becomes a risk only when it is hidden inside a marked-up system price rather than disclosed in writing (NerdWallet, 2025). The fee itself is not the red flag. A partner who will not name it is.
Ask for the fee in writing, per tier or scope, before you sign anything. Then compare total cost, not headline rate, across programs for the same exact system. In 2023, the CFPB found some lenders cram markup fees into solar loans in ways that raised the total loan cost 30% or more above the cash price (CFPB, 2023). A program that hits that pattern is not offering you a good rate; it is moving the cost somewhere you were not looking.
For the full mechanics of where fees hide and how to read a program line by line, see how dealer fees actually work.
Is the partner a direct lender, a marketplace, or a point-of-sale platform?
The financing model determines who is accountable when something goes wrong. A direct lender funds and services its own loans. A marketplace or point-of-sale platform routes the application to a separate funding source, adding a layer between you and the money. Ask this question before anything else: whose capital is actually funding the loan?
That question is not academic. On June 6, 2025, Mosaic, one of the largest US residential solar and storage lenders, filed for Chapter 11 bankruptcy, after pausing new loan originations and installer milestone payments in May 2025 (Solar Power World, 2025). Contractors whose pipelines ran through Mosaic had to re-paper deals mid-quarter with no warning.
When we onboard a new dealer, the red flag we hear about most often is a program that will not put its dealer fee in writing, followed closely by "who actually funds this loan?" going unanswered on a sales call. Those two gaps tend to travel together, and neither one is a small detail.
A direct lender removes a layer of intermediation between the money and your customer, which shortens the chain of parties that can fail, delay, or obscure a fee. A marketplace can still be a reasonable choice if breadth of credit tiers matters more to your business than continuity, but you should make that trade-off knowingly rather than by accident.
See how Eos Loan financing helps you close more projects
For a full side-by-side breakdown, compare the 3 contractor financing models in detail.
How fast is approval, and how flexible are the terms?
Homeowners generally expect a credit decision within minutes at the kitchen table when a program is built for point-of-sale use, and slow decisioning is one of the most common reasons a financed deal stalls before signature. Ask a prospective partner for their typical decision timeline in minutes or days, not a vague "fast" answer, and get funding timing (lump sum vs. draw schedule) in writing too.
Term flexibility matters just as much as speed. For battery energy storage, financing terms can range from 6 to 240 months depending on underwriting, and a longer term generally produces a lower monthly payment on the same system. EV charger and water filtration programs should be described to you in terms of flexible terms rather than a single fixed number; ask any partner to state their specific term structure rather than accepting "flexible" as a complete answer.
Neither approval speed nor term structure is guaranteed by any lender; both are subject to approval and eligibility, and a program that promises otherwise is a program worth double-checking. For a deeper look at how term length changes what a customer pays monthly, see how loan term length affects monthly payment.
Does the partner cover more than one type of project?
A contractor who only sells battery energy storage today may add EV chargers or water filtration next year, and re-vetting a new financing partner for every product line adds real friction. Multi-vertical coverage under one financing relationship simplifies training, dealer portal logins, and the customer experience at the kitchen table.
Single-vertical financing forces contractors to manage separate lender relationships, separate applications, and separate dealer portals as they expand into adjacent essential projects. With US storage growth at 52% year over year in 2025 (Wood Mackenzie, 2025), more installers are adding EV chargers and water filtration alongside storage, which makes this a live decision, not a hypothetical one.
To see how storage, EV charger, and water filtration financing work together under one program, read financing storage, EV chargers, and water filtration under one partner.
What should you ask before you sign?
A short, direct question list settles most of the due-diligence work in a single call. Bring these questions to any prospective financing partner, and do not accept a vague answer to any of them:
1. How is the dealer fee disclosed, and can I get it in writing?
2. Are you a direct lender, or do you route applications to a third party?
3. What is your typical approval time in minutes or days?
4. What term options do you offer for my project type, and how are they underwritten?
5. What happens to a project already in progress if your funding changes?
6. Do you cover more than one essential project type, or would I need a second program?
7. Who services the loan after it funds, and who do I call if there's a problem?
8. Can I see your fee schedule and terms for a specific project scope before I commit a customer?
!A small team of installers reviewing a dealer portal during an onboarding session in a bright office
A partner who answers all 8 clearly, in writing, is telling you something important before you ever fund a loan through them. A partner who hedges on 2 or 3 of these is telling you something too.
Watch for a specific pattern: a program that answers the rate question instantly but goes vague on questions 1, 2, and 5. That combination, a headline number with no fee disclosure, no clarity on who funds the loan, and no answer about in-progress projects, is the exact profile of a program that looks fine on a Tuesday and causes a problem later. None of the 8 questions is a formality; each one closes off a specific way a financing program can fail you.
Become an Eos Loan financing partner
Or call +1 833-989-3737 to talk through a financing program for your business.
For the broader playbook on setting up a financing program from scratch, see the full guide to building a contractor financing program, and if you want to weigh named companies against this same checklist, see how specific programs rank on these criteria.
Frequently Asked Questions
{ question: "What is a dealer fee, and is it a red flag?", answer: "A dealer fee is a normal funding discount a lender takes, not inherently a red flag. The risk is when it is undisclosed or buried in a marked-up system price rather than shown in writing (NerdWallet, 2025). The CFPB found some lenders cram markup fees into solar loans, raising cost 30%+ above cash price (CFPB, 2023). Ask for the fee in writing before you sign." }, { question: "Is a direct lender always better than a marketplace?", answer: "Not automatically, but a direct lender removes a layer of intermediation. Ask who services the loan and who is accountable if something goes wrong. Mosaic's Chapter 11 filing in June 2025, after pausing loan originations in May 2025, is a concrete example of what happens when financing depends on a party whose own funding falls apart (Solar Power World, 2025)." }, { question: "How fast should financing approval be?", answer: "Frame it qualitatively: point-of-sale programs are generally built for in-home decisioning in minutes, not multi-day underwriting. Ask any prospective partner for their specific typical timeline rather than accepting a general claim of being fast, and confirm the answer in writing." }, { question: "Should I use one financing partner for all my essential project types?", answer: "Multi-vertical coverage across battery energy storage, EV chargers, and water filtration under one partner reduces the number of separate lender relationships and dealer portals you manage as your offerings expand. It also simplifies training for your sales team across product lines." }, { question: "What financing terms are typical for battery energy storage?", answer: "Terms vary by underwriting and can range from 6 to 240 months. Ask any prospective partner for their specific term structure rather than assuming a fixed number, and treat EV charger and water filtration terms as flexible unless a partner states specifics in writing, all subject to approval and eligibility." } ]} />The bottom line before you sign
Choosing a financing partner comes down to 6 checks, run every prospective program through them:
- Get the dealer fee disclosed in writing, and compare total cost, not headline rate.
- Confirm whether you are working with a direct lender or a marketplace, and understand what that means for accountability.
- Ask for a specific approval timeline in minutes or days, not a general claim of speed.
- Get term options in writing; for battery energy storage, terms can range 6 to 240 months, subject to approval and eligibility.
- Weigh multi-vertical coverage if you sell, or plan to sell, more than one essential project type.
- Ask what happens to in-progress projects if the partner's funding changes, and take the answer seriously.
- Consumer Financial Protection Bureau, CFPB Report Finds Lenders Cramming Markup Fees and Confusing Terms into Solar Energy Loans, retrieved 2026-07-10, https://www.consumerfinance.gov/about-us/newsroom/cfpb-report-finds-lenders-cramming-markup-fees-and-confusing-terms-into-solar-energy-loans/
- NerdWallet, Solar Loans and Solar Panel System Financing Options (dealer-fee mechanics), retrieved 2026-07-10, https://www.nerdwallet.com/best/loans/personal-loans/solar-loans-solar-panel-system-financing-options
- Wood Mackenzie, 2025 U.S. Energy Storage Installations Set New Record, Surpass 2024 by 52%, retrieved 2026-07-10, https://www.woodmac.com/press-releases/2025-u.s.-energy-storage-installations-set-new-record-surpass-2024-by-52
- Solar Power World, Solar Finance Platform Mosaic Files for Bankruptcy, retrieved 2026-07-10, https://www.solarpowerworldonline.com/2025/06/solar-finance-platform-mosaic-files-for-bankruptcy/
- Internal Revenue Service, Residential Clean Energy Credit (Section 25D ended December 31, 2025), retrieved 2026-07-10, https://www.irs.gov/credits-deductions/residential-clean-energy-credit
A quick note on 2026 timing: the residential clean-energy credit (Section 25D) ended December 31, 2025 (IRS, 2025), so financing terms, not a federal credit, are the affordability lever on residential pitches now. This is general information, not tax advice. Consult a qualified tax professional.
Eos Loan is a direct lender, not a marketplace or a platform that connects you to other lenders. Eos Loan charges no dealer fee, finances battery energy storage, EV chargers, and water filtration under one relationship, and offers battery energy storage terms from 6 to 240 months, all subject to approval and eligibility. Run us through this same checklist.
Offer your customers flexible financing on essential projects
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Sources
About the author: Eduardo Donadi is the CEO of Eos Loan, the fintech built to finance essential projects (battery energy storage, EV chargers, and water filtration) for installers, contractors, and resellers across the United States.