Guide

Should You Offer Customer Financing on Big Jobs?

Payment plans can turn a stalled $12,000 estimate into a signed job this week — but the dealer fee comes out of your margin, not the customer's pocket. Here's how to decide when it's worth it.

Why this is coming up more this fall

Interest rates have kept financed monthly payments a real sticking point for homeowners in 2026, and material costs on jobs involving steel, copper, or aluminum components have been climbing most of the year on tariff-driven increases. That combination — bigger job totals, tighter household budgets — is exactly the setup where financing offers move the needle, and it's also exactly when third-party lenders and BNPL platforms are pushing hardest to sign up more contractors.

If you do bathroom remodels, roofing, HVAC replacements, full repaints, or big landscape installs, you've probably already had a homeowner ask "do you offer payment plans?" If you don't have an answer ready, you're losing some of those jobs to whoever does.

The math lenders don't lead with

Financing platforms (Hearth, GreenSky-style bank programs, Wisetack, Synchrony, and similar) pay you the job total up front, minus a dealer fee. That fee is the cost of doing business with them, and it varies a lot by program:

• Standard installment loans (customer pays interest): typically 2-4% of the job total.
• Promotional 0%-interest plans (you're subsidizing the rate): typically 8-25%+, depending on the term length. Longer 0% terms cost you more.

Worked example: an $18,000 HVAC replacement financed on a 12-month 0% plan with a 15% dealer fee costs you $2,700 off the top. Financed on a standard interest-bearing plan at 3%, it costs you $540. Same job, very different hit to your margin — always ask which fee structure applies before you quote.

Run the after-fee number through your job profitability calculator before you commit to a promotional plan on a job with thin margins — a 15% dealer fee can turn a decent job into a break-even one if your material and labor costs were already tight.

When financing is worth the fee

Financing tends to pay for itself when most of these are true:

• The job is big enough that "the total" is the actual objection — usually somewhere north of $3,000-$5,000, where a monthly number changes the conversation.
• You're competing against other bidders who already offer it. If two quotes are close and one includes a payment option, that's often the tiebreaker.
• Your close rate on big-ticket estimates has been soft, and follow-up shows price (not trust or timeline) is the sticking point.
• You can eat the fee inside your normal markup rather than cutting into take-home pay. Check this against your markup and margin numbers — if you're already pricing at a thin margin, financing fees need to be built in as a line item, not absorbed.

It's usually not worth it for small jobs, service calls, or maintenance visits under a couple thousand dollars — the dealer fee eats a disproportionate share of a small job's margin, and most customers will just pay a $400 invoice outright anyway.

How to price it without guessing

Two common approaches, both fine as long as you're consistent and transparent:

1. Two prices, one cash/check and one financed. Similar to how many shops handle credit card surcharges: the financed price includes the dealer fee, the cash price doesn't. This is the cleanest way to make sure the fee never comes out of your pocket.
2. One price, fee baked into your standard markup. Simpler for the customer, but only works if your markup already has enough room. Do this math once per job type, not on the fly mid-estimate.

Whichever you choose, check your state's rules before doing anything that looks like a financing surcharge — some states restrict or require specific disclosure language for surcharges, and this is a "check locally / with your accountant or a business attorney" situation, not a guess-and-go one.

Presenting it so it actually closes the job

The framing matters more than the fine print. Leading with "this is $14,500" versus "this is about $310 a month" gets very different reactions from the same homeowner, even though the numbers are identical. A few practical notes from contractors who've made financing a normal part of their pitch:

• Mention it during the estimate, not as an afterthought after they've already said "let me think about it." By then they've mentally filed the job as "too expensive."
• Have one or two lender partners set up ahead of time so you can send an application link on the spot, not "I'll look into that and get back to you."
• Put the monthly-payment option on your written estimate itself, next to the full price, so it's part of the first impression.

If quote follow-up is already something that falls through the cracks in your business — estimates that go out and never get a second touch — that's exactly the kind of repetitive admin work our done-for-you services handle, including chasing financed leads who stall out mid-application.

What to watch for

A few traps that show up once financing becomes part of your regular pitch:

• Approval isn't guaranteed. Build a backup plan (deposit + progress payments) for customers who apply and don't get approved, so you don't lose the job entirely.
• Funding timing. Some platforms fund on completion, others on signed contract — know which before you schedule material orders against expected cash.
• Fee creep on promotions. Lenders periodically change dealer fee tiers. Recheck your numbers every few months rather than assuming last year's fee still applies.

If you're building or updating your price book to account for financing tiers, a simple one-page reference sheet (cash price, standard-finance price, promo-finance price per job type) saves you from re-deriving the math on every estimate — the kind of template included in a basic operations kit if you don't already have one.

Common questions

How much do financing companies charge contractors?

Standard installment loan programs typically charge a dealer fee of 2-4% of the job total, deducted when you get funded. Promotional plans, like 0% interest for 12 months, typically run 8-25% or more, because the financing company is eating the interest the customer would otherwise pay.

Does offering financing actually help close more jobs?

For jobs in the multi-thousand-dollar range, yes, typically. Homeowners facing a large one-time bill often stall or shop around; the same job framed as a monthly payment tends to close faster and at a higher average ticket, because customers stop anchoring on the total and start comparing it to a car payment.

Should I build the financing fee into my price or eat it?

Most small operators build it into the price for jobs where financing is offered, similar to how you'd treat a credit card surcharge, and keep a lower cash/check price as the default. Check your state's rules on surcharging and truth-in-lending disclosure before doing this — they vary.