Buying new impact windows is a great way to enhance your home’s safety, energy efficiency, and security against all manner of threats. But it can be expensive. That’s why financing windows can be such a great option. By financing your window purchase, you can enjoy the benefits of new windows sooner rather than later while also alleviating the upfront financial impact.
However, not all window financing offers are created equally. And some companies may dress up their financing offers in a way that doesn’t strictly comport with the reality of their marketing.
Before you start financing window purchases and enter into a legally-binding contract with any window company, it’s important to check a few things. Let’s go over some of the most important things to review in any window financing agreement and some common pitfalls to watch out for.
#1 Check Before Financing Windows: The Company’s Website & Marketing
Before entering into any financing agreement with a window company, it’s important to review what the company has publicly stated about their financing options. Look through their website for any mentions of their financing program and try to get details about:
- Who their financing partners are (if any).
- Specific financing program features (introductory rates, grace periods, etc.).
- Exemptions/exclusions regarding the financing programs available (eligibility requirements, conditions that void the promotional terms, etc.)
- That any written commitments about the financing program exist at all.
A lot of companies, and not just window companies, will tout that they have “the best” or “great” financing options available, but won’t commit to sharing details about their financing programs on their website or in their marketing materials.
That’s a huge red flag.
If they’re telling you on the phone that they have a great window financing program, but you can’t find more than vague references to it on their website or in their marketing materials, that could be a warning sign that the program isn’t as well-crafted as their sales reps are making it sound.
#2 Check Before Financing Windows: Who’s Providing the Financing?
When you’re financing your window installation, who is the company behind the financing offer: the window installation company itself, a reputable bank, or some other financial institution you’ve never heard of?
Something like 96% of successful contractors offer financing of some kind (Source: Foundation Finance), but not all of them offer so-called “first party” financing where the installation company is the one backing the “loan” paying for your new windows and doors. And the ones that do usually partner with a bank to provide it.
Instead, many financing plans are served by a dedicated third party financial institution.
A lot of financing companies, even great ones, aren’t really household names for anyone not in the financial industry. A lot of people have heard of Truist Bank, but might not know the subsidiaries that handle their financing plans, like Service Finance Company, LLC.
Before signing any agreements, it’s important to look into the entity providing the financing and research them thoroughly. See what others have to say about the company, check to see if they’ve faced any regulatory backlash for their lending practices, and get a feel for how they tend to operate.
This helps you go into your window financing plan with both eyes open.
Why Is Third-Party Financing So Common?
If you’re wondering why third-party financing is the norm or why installers often work with banks to provide financing, it’s to help them maintain cash flow while managing risk.
By having a bank or financing company take on the financing plan rather than letting customers pay over time, window installers can ensure they get money up front to cover the cost of acquiring the windows and doors they install, labor for the installation, and other overhead.
If they provide real “first party” financing, they’re assuming all of the risk of a default. For a small business, that’s an enormous liability, even with the ability to place a construction lien (also known as a mechanic’s lien) against a property in the event of a default.
So, many window companies prefer to offload the process onto a specialist organization with the resources and expertise to appropriately assess loan risks and absorb the occasional default and the associated costs without issue.
Karoly Windows & Doors provides third-party financing through two different financial institutions:
- GreenSky. Greensky offers a $0 down payment financing option with up to twelve months of no interest and no payments required (interest and payments accrue as normal if the loan is not repaid within the 12-month promotional period).
- Synchrony Financial. Synchrony provides Karoly customers with a financing option that requires no money down, and has a 24 month-long promotional period where you have 0% interest, though regular payments are required.
These are both well-known institutions with solid reputations who have distinctive financing plans for our customers that bring a good value. The best part of these financing plans is that, if you pay them off entirely before the end of the promotional period, you don’t pay a dime of interest.
#3 Check Before Financing Windows: The Actual Financing Contract
A lot of financing offers, for windows or any other major purchase, sound great in their marketing materials and sales rep promises, but don’t rely on marketing and sales speak alone! What really matters is what’s written on the financing agreement itself, not what was said verbally or in an ad.
That’s where some financing options that sound good at first start to fall apart. Why? Because, the contract includes clauses that run contrary to what was promised in prior marketing or sales conversations.
This is why you shouldn’t just rely on what a sales rep or marketing ad says. Instead, be sure to take the time to carefully read through the actual terms and conditions of the agreement to see what it says before you sign off on it.
Some things to check for include:
- What the actual Annual Percentage Rate (APR) for the loan is.
- What the promotional period is (if any), and interest rates are calculated before and after the period ends.
- For example, for many 0% interest rate offers, the full amount of the normal interest that would have been owed is applied once the promotional period ends if any balance remains. So, say you had a $40,000 loan with a 25% APR normally, but was 0%. If you didn’t pay it off before the promo period ends, you’d end up owing a total of $50,000 ($40k + $10k of interest). However, if you paid it in full, you wouldn’t owe any interest at all, leaving the final price at the base $40k.
- When payments are due and the payment minimums.
- Any penalties for missed or late payments.
Always be sure to get either a physical or digital copy of the agreement for your own records. That way, you can be sure you know exactly what you agreed to!
As always, financing remains a great way to help you cover the cost of getting new windows in your home. But, it’s important to enter these agreements with both eyes open so you don’t get surprised later on down the road.
Karoly’s Newest Financing Offer: No Money Down, 0% Interest and 0 Payments for 24 Months
Karoly is expanding its financing options with a new plan that is no money down with no payments or interest for up to two years!
The goal of this financing offer is to further expand Karoly’s window services to a wider audience. Get your new windows expertly installed by the best team in Tampa Bay while enjoying a more convenient and affordable financing payment schedule!
Get a free in-home estimate
Tell us about your windows or doors and we'll give you a free, no-obligation quote.
