Residential HVAC Equipment Financing: No Credit Check

Homeowners with weak borrowing credentials often attempt to finance without a credit check to enable monthly payment plans to replace residential HVAC equipment such as furnaces, water heaters, and air conditioning.

Given these systems’ high price tag, it might be challenging to find a finance company willing to approve your application without viewing your consumer report or considering your FICO® or Vantage® score.

Therefore, you might want to explore the alternatives to stay cool in the summer, warm in the winter, and enjoy hot water when bathing, washing dishes, and cleaning laundry.

Follow along as we break down six possible avenues (and two to avoid).

Furnace Financing Options

First, we explore several ways to finance furnaces without a credit check. Apply the lessons learned from these examples to establish monthly payment plans for other residential HVAC replacement equipment.

Bad Credit

Homeowners with adverse histories on their consumer reports often think financing a replacement furnace without a credit check is the only way to pay monthly for this expensive residential HVAC equipment. This assumption is not valid on at least two levels.

  1. Subprime companies specialize in lending to consumers with bad credit. They might consider alternative data (rental history, cell phone payments, etc.) instead of or in addition to FICO® and Vantage® scores.
  2. Online lead aggregators capture unsecured personal loan requests from interested consumers and present their borrowing credentials to a vast network of subprime lenders. Sheer volume boosts your approval odds.

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Government Grants

The ideal way to finance a replacement furnace (or any HVAC equipment) without a credit check is to get the system free – or at a meager cost. Your monthly payment will be most affordable when the government steps in to help.

Government grants for HVAC equipment sometimes result in free equipment, especially when you factor in the cost of running the new energy-efficient systems. Three programs combine to make a significant dent in total ownership costs.

  1. The Weatherization Assistance Program improves homes’ efficiency, lowering electric and gas costs.
  2. The Low Income Home Energy Assistance Program helps families pay utility bills.
  3. The Energy Star program offers rebates to purchase efficient HVAC equipment.

Water Heater Financing

Second, we explore ways to finance water heaters without a credit check. Apply the lessons from this section to arrange monthly payment plans for other residential HVAC replacement equipment.

Companies with Financing

Looking for HVAC companies with in-house financing is a lousy way to establish monthly payment plans without a credit check. Would you go to your local bank branch and ask them if they offer replacement water heaters in-house?

Of course, that would be silly. The bank would refer you to a local contractor specializing in selling and installing water heaters while offering to help you with your money issues.  

Likewise, HVAC companies that offer “in-house financing” refer customers to bankers handling underwriting, funding, billing, and collections functions. You are not finding a more lenient lender by waiting until the last second.

Requesting a bad credit loan with low monthly payments before contacting a contractor can help you avoid last-minute snafus. Choose the provider with the best price, service, and reputation instead of one that offers “in-house financing.”

Separate the transactions.


Rent-to-own arrangements are a popular way to replace a water heater without a credit check and make monthly payments later. These HVAC financing plans appeal to homeowners who traditional lenders have turned away because of adverse history on their consumer reports.

Many rent-to-own companies will not consider your credit score and other traditional underwriting tools. However, they may still look at reports from alternate bureaus to verify that you meet their base criteria.

  1. Own the home where the installation will occur
  2. Current on the mortgage payment
  3. Employed for at least six months
  4. Household income above $2,750 per month
  5. Have an open checking account with a positive balance
  6. No Non-Sufficient Funds (NSF) in the last ninety days

Homeowners should know the potential downsides to using rent-to-own contracts before signing on the dotted line. Read the agreement carefully, looking out for any of these potential pitfalls.

  • Balloon payments at the end of lease terms to transfer ownership
  • Total installments exceed the retail price by 100% or more
  • Requirements to purchase insurance or extended warranties
  • Possible repossession without compensation for money received

Air Conditioner Financing

Finally, we explore ways to finance air conditioning without a credit check. Apply the concepts covered in this section to establish monthly payment plans for other residential HVAC replacement equipment.

Medically Necessary

Believe it or not, a Flexible Spending Account (FSA) could be a viable way to pay for an air conditioner without a credit check. However, only people with significant health conditions will qualify.

You can use this FSA trick to fund specific home repairsflooringswimming pools, and more.

Home improvements accompanied by a letter of medical necessity are FSA-eligible expenses, provided they do not increase the property value. For example, severe asthma, allergies, or other respiratory illnesses might require special HVAC equipment.  

  • Air conditioner
  • HEPA filters
  • Air purifiers

Employees can access the full amount in their FSA at the start of the year, even without prior contributions. Over the year, they repay the advanced amount through pre-tax deductions from their paycheck.

  1. Elect to make FSA contributions during the annual open enrollment.
  2. Install the air conditioner at the beginning of the FSA plan year.
  3. Your employer must reimburse qualifying expenses immediately.
  4. You have up to 12 months to repay the interest-free advance using pretax dollars, which saves money in up to three ways.
    1. Federal income taxes
    2. State income taxes (where applicable)
    3. FICA taxes

Per IRS rules, employers cannot pull your consumer report or consider your credit score. They must accept all participants regardless of any adverse payment information appearing on their file.

Portable Units

Finally, monthly payment plans for a single portable air conditioner are most realistic without a credit check because the amount financed is much smaller than that for central air installations and multiple window units.

Portable air conditioners allow the user to move the unit from room to room to cool off the living space in use at the time, unlike systems that lower temperatures throughout the house or multiple living spaces.

Personal loans based on income, not credit score, go to consumers who keep the monthly payment low compared to their earnings. Portable A/C units make this happen in two ways.

  1. Lower price compared to central air
  2. Fewer units compared to window A/C