How to Finance a New AC Unit 


In the heat of summer, there’s nothing worse than having your AC unit call it quits, especially if you weren’t planning on getting a new one. Given the choice between sweating it out and pulling a chunk of change out of savings, most homeowners are left with a quandary. 

However, it’s possible to purchase a new AC unit without emptying your bank account or tapping into home equity. With AC financing, you can enjoy a new unit and keep more of your money in the bank — or in your house — making for an enjoyable, comfortable environment during the summer months. If you’re curious about how to finance a new AC unit, read on for our best tips on estimating costs, finding an AC financing company, and getting the best interest rate for your needs.

What Is the Cost of a New AC Unit?

The cost of a new AC unit depends on the type of unit you want and the labor costs involved. With costs ranging from a few hundred dollars to upwards of $12,000, it’s worth it to do some research to determine the best AC unit for your specific situation. The following are some of the most popular types of AC systems.

Portable unit: $90 to $500

This type of unit works well for a small space where you want the flexibility to move the AC unit from room to room.

Window unit: $150 to $550

Like a portable unit, a window unit cools one room, but it gets mounted in a window.

Ductless split: $2K to $14.5K

A ductless split system can cool one or multiple rooms. Typically, these units have wall-mounted air handlers that connect to one or more outdoor condenser units. As the name implies, these units do not require the installation of new ductwork. 

Central air conditioner: $3.8K to $7.5K

Central AC is a popular option in hot climates like central Tennessee. While these systems are pricier than some of the other options, they’re also workhorses when it comes to cooling and dehumidifying indoor air. Because the air is pushed through a home’s ductwork, it cools all parts of the home.

Heat pump: $4.2K to $7.6K

Heat pumps transfer heat outdoors in the summer and indoors in the winter, allowing for year-round comfort with low operating costs and high energy efficiency. 

At Rapid Response Heating and Cooling, our air conditioning installation services start at $6,899. Several factors go into the overall costs, including the AC unit’s size and capacity, the type of system, its efficiency rating, installation costs, and frequency of ongoing maintenance and repairs.

In addition, the full process of AC installation includes several steps, such as preparing and cleaning the mounting location, paying for permits or other fees, or obtaining additional components.

If you’re not sure what kind of AC unit you need, whether you need repairs or a completely new system, or what kind of labor costs might be involved, you can give us a call or request a quote online. Once we have a better idea of the AC unit you want and what the existing system entails, we can give you an estimate and help you find the best system.

AC Financing Options

AC financing enables you to improve your indoor temperature now rather than utilize home equity or wait until you’ve saved up enough cash. Look for competitive interest rates, flexible loan terms that work with your monthly budget, and fast funding that gets your AC unit financed quickly. Consider the AC financing options below to determine what works best for you.

Loans For Air Conditioning 

When considering AC financing options, you have a variety of loan types to consider, each tailored to different financial preferences and situations.

Personal Loans

Personal loans are unsecured, meaning you don’t need to put up any collateral to secure one, such as your home or car. Interest rates vary, with the average rate being 11.29%; however, this rate may be higher or lower depending on your creditworthiness. With a personal loan, you have fixed monthly payments over a predetermined period, allowing you to budget effectively.

Home Improvement Loans

Home improvement loans are designed specifically for funding projects like installing an AC unit. These loans may be secured or unsecured, and the interest rates can also vary. Depending on the lender, you might have the option to extend the repayment period, which could result in lower monthly payments. Some government programs, such as Title I, also offer home improvement loans with attractive terms.

Energy-Efficiency Loans

If you’re opting for an energy-efficient AC unit, you might be eligible for special energy-efficiency loans through a government-insured or conventional loan program. 

Credit Union Loans

As member-owned financial institutions, credit unions often can offer more favorable rates than traditional banks.

Manufacturer or Retailer Financing

Some AC manufacturers or retailers offer financing plans to make their products more accessible. 

Home Equity Loans or Home Equity Lines of Credit (HELOCs)

Home equity loans and lines of credit allow you to borrow against the value of your home. Proceed with caution, however, as failure to repay could put your home at risk.

HVAC Financing Companies

As you explore your options for how to finance an AC unit, you may encounter a variety of HVAC financing companies willing to fund your loan for air conditioning. A few options for AC financing include Upstart, LightStream, Discover Personal Loans, and SoFi. The simplest way to find the best rate is to compare rates from several lenders and find the one with the best interest rate, affordable monthly payments, and fast funding.

Oftentimes, working directly with a retailer is a great way to get the funding you need quickly without jumping through hoops. Rapid Response Heating and Cooling offers financing in partnership with Hearth to enable clients to access funds and get their AC unit project off the ground quickly. 

With personalized monthly payment options, no prepayment penalties, and funding within one to three days, our financing program makes it easy to cover the cost of a new AC unit. Use our financing calculator to estimate your costs, and check your monthly payment options without impacting your credit score.

Can I Get Air Conditioning Financing With Bad Credit?

Having bad credit doesn’t necessarily mean you’re out of options when it comes to financing your AC unit. While it might be more challenging to secure favorable terms, there are still potential avenues to explore, such as those below.

Deep Subprime or Subprime Lenders

Some lenders specialize in working with individuals who have lower credit scores. Deep subprime lenders may work with those who have credit scores below 580, while subprime lenders may work with those who have credit scores between 580 and 619. However, keep in mind that interest rates may be higher than those offered to borrowers with higher credit scores, which demonstrate an ability to pay back a loan.

Co-Signer or Joint Application

If you have a family member or friend with good credit, you can apply for financing together. Their good credit could improve your chances of approval and help you secure more favorable terms.

Secured Loans

A secured loan requires collateral, such as an asset or a savings account, to back the loan. Because the lender has a tangible asset to claim in case of non-payment, they might be more willing to approve the loan even with bad credit. However, be cautious, as you could risk losing the collateral if you’re unable to make payments.

Improving Credit Before Applying

Improving your credit score before applying for financing could open up better options. Paying down outstanding debts, managing your credit utilization (aim to keep it below 30%), and correcting any errors on your credit report can help boost your creditworthiness. Request a free copy of your credit report annually from each of the three major consumer credit reporting companies — TransUnion, Equifax, and Experian — via to identify issues and opportunities.

When exploring loan options for your AC unit, keep in mind the following factors:

  • Interest rates. Look for competitive interest rates that align with your financial capabilities. A lower interest rate can significantly impact the total cost of the loan.
  • Loan terms. Choose loan terms that fit your monthly budget. Longer terms might result in smaller monthly payments, but you could end up paying more in interest over time. However, if you expect to be able to pay off the loan sooner and there are no prepayment penalties, a longer loan term may be worth it for that cool indoor air.
  • Fees. Ask about origination fees, prepayment penalties, and other hidden charges.


From personal loans to energy-efficient financing programs, you have an array of options for financing an AC unit — ensuring that even individuals with lower credit scores can find a suitable solution. Remember that while credit scores play a role, they don’t define your eligibility for HVAC financing. Many lenders are willing to work with you to tailor financing terms that align with your specific needs.

When considering HVAC financing, research and compare different lenders, terms, and rates. Be sure to evaluate your budget, long-term financial goals, and the potential impact on your financial health. Whether you choose a traditional lender, a government-backed program, or retailer financing, the key is to strike a balance between immediate comfort and responsible financial planning.

Keep in mind, too, the seasonality of your purchase, the benefits of energy-efficient upgrades, and the potential for government incentives. Moreover, make an effort to understand the terms and conditions of your chosen financing option to avoid any surprises down the road.

Ultimately, the goal of financing your HVAC system is to create a more enjoyable living environment without straining your budget or interfering with your long-term financial goals. By making informed decisions, leveraging available resources, and aligning your choices with your unique circumstances, you’ll be well on your way to enjoying optimal indoor temperatures and increased energy savings for years to come.


1. What credit score do you need to finance an HVAC system?

Requirements vary depending on the lender and the type of financing. Generally, a higher credit score improves your chances of securing better terms and lower interest rates. However, there are options available for individuals with lower credit scores as well.

2. Do I need perfect credit to get HVAC financing?

No, you don’t need perfect credit to secure HVAC financing! Many lenders offer financing options for individuals with lower credit scores. While perfect credit might result in more favorable terms, there are options tailored to different credit situations.

3. What is the best time of year to buy an HVAC system?

Spring and fall are optimal times to upgrade your HVAC because these are off seasons when demand is lower. During these periods, HVAC companies may offer promotions or discounts to attract customers.

4. What are the advantages of getting a loan for air conditioning?

Financing an HVAC system allows you to improve the comfort of your home without the need for a large upfront payment. It can also help you distribute the cost over time, making it more manageable for your budget.

5. Are there any government incentives for energy-efficient HVAC systems?

Yes, some governments offer incentives, rebates, or tax credits for installing energy-efficient HVAC systems. These incentives are designed to encourage environmentally friendly choices and can significantly offset the cost of your new system. Check with your legal or tax advisor to learn of available incentives.

6. Can I pay off my HVAC financing early without penalties?

Clarify this question with your lender before finalizing the financing agreement. Some lenders impose prepayment penalties, while others allow you to pay off the loan early without additional charges.

7. How can I improve my chances of getting approved for HVAC financing?

To enhance your approval odds, work on improving your credit score before applying. Additionally, gathering necessary financial documents, choosing a reputable lender, and having a steady income can all contribute to a smoother financing application process.

Looking for an HVAc Professional in Brentwood, TN?

We are the right choice for all your HVAC needs! Here at Rapid Response, we understand that no two customers are the same and that is why our team of trained professionals will go above and beyond to meet the customized cooling needs of every customer. By choosing us you will receive fair rates, quality work and outstanding service.