Offer financing when your average ticket is above roughly $5,000 and you can find a program under about 8 percent. Below that, the fee usually costs you more than the extra jobs are worth.
That is a narrower answer than you will find anywhere else on this question, and there is a reason. Search for it and almost every page that ranks is published by a lender, a lending marketplace or a platform that earns a cut of every loan. They all conclude yes. Meanwhile the top-voted reply in the largest r/Contractor thread on the subject, sitting at 100 upvotes, is three words: "Work for clients with money."
Both camps are arguing from vibes. The question has an arithmetic answer, and it is not hard to work out.
The four numbers that decide it
You do not need a lender's opinion. You need four numbers you already have:
- Your average ticket. The dollar size of a typical closed job.
- Your gross margin. What is left after materials and labour, before overhead.
- The dealer fee the program charges, as a percentage of the job.
- Your attach rate. The share of closed jobs that will actually use financing.
Everything else in this article is those four numbers arranged differently. Get them wrong and no amount of sales training rescues the program.
What the data actually says
The credible number comes from ACCA's 2025 Contractor of the Future Study, run with Farmington Consulting Group across more than a thousand contractors. Shops that offer financing close 49 percent of their estimates. Shops that do not close 38 percent. That is an 11 point swing.
The same study found something more useful and much less quoted: leading with the monthly payment instead of the lump sum nearly doubled the share of jobs that got financed, from 21 percent to 42 percent.
That second figure is the one that decides whether your program is profitable, because your attach rate is the multiplier on your fee bill. Double the attach rate and you double what financing costs you. Every lender-published page celebrates the 21 to 42 jump. None of them mention that it also doubles their revenue from you.
By the numbers
One third of all home improvement projects in 2024 were financed, according to Enhancify. Meanwhile only 37 percent of contractors offer financing on every job, per the industry data compiled by United Consumer Financial Services from the ACCA study.
Context matters here. The ACCA study is HVAC. The average residential changeout now runs $11,000 to $20,000 installed, after Section 232 metal tariffs pushed the effective rate on Mexican-made HVACR equipment from roughly 8 percent to nearly 25 percent and the A2L refrigerant transition added cost on top. An 11 point close-rate lift is entirely believable when the number on the invoice is $14,000 and the homeowner does not have $14,000.
It is not believable on a $400 drain call. Nobody's close rate moves 11 points because you offered to split a $400 repair into payments. The customer with a flooding basement is not comparison shopping payment terms. Borrowing the ACCA figure and applying it to small-ticket service work is the single most common way contractors talk themselves into an unprofitable program.
The three ways to offer it, and what each really costs
| Model | What you pay | Who it suits | The catch |
|---|---|---|---|
| Dealer-fee buy-down (Wells Fargo Home Projects, Synchrony, Service Finance, GreenSky) | 3% to 45% of the job, commonly 5% to 12% | High-ticket replacement sales with a trained in-home process | The better the promo you give the customer, the bigger the cut. Deposits often prohibited. |
| Flat per-job platform (Wisetack and similar, often bundled into field software) | Roughly 3.9% to 4% per financed job, no subscription | Anyone wanting financing available with near-zero setup | Rates the customer sees are market rates, so it wins fewer price-driven deals. |
| Marketplace licence (Enhancify and similar) | A once-annual licence, unlimited loans | Volume shops that want soft-pull shopping across many lenders | Fixed cost regardless of use, so low volume makes it expensive per job. |
| Referral only (credit union, HELOC, bank partner) | Nothing | Sub-$5,000 tickets, discretionary and luxury work | No control, slower, no soft pull, and the customer may not follow through. |
The fourth row is the one no ranking page recommends, because nobody sells it. It is also what a large share of experienced contractors actually do. One r/Contractor operator described his entire program as "I offer financing through my bank partner at Chase. That's it. It's literally just a referral." Another using Regions Bank noted the practical advantage that made it worth the effort: "The best thing is that they pay me directly rather than sending the customer the money first."
Notice the range on that first row. Enhancify puts dealer fees at 3 percent to as high as 45 percent. A contractor who worked at two home improvement companies running GreenSky and Service Finance described the spread from the inside: "They charge a percentage on the total job, average around 5 percent though some are as high as 25, so pay attention to vendor fee."
A 5 percent fee and a 25 percent fee are not variations on a product. They are different businesses.
The break-even formula nobody publishes
Here is the arithmetic. Per 100 estimates, financing pays for itself when the gross profit from the extra jobs you win exceeds the fees you pay on every financed job, including the ones you would have closed anyway.
Write your base close rate as C, your gross margin as m, your attach rate as A, and the dealer fee as f. The close-rate lift you need in percentage points is:
Lift needed = (C × A × f) ÷ (m − A × f)
Run it at ACCA's 38 percent base close rate and the picture gets very clear very fast.
| Gross margin | Attach rate | Dealer fee | Close-rate lift needed to break even |
|---|---|---|---|
| 40% | 21% | 3.9% | 0.8 points |
| 40% | 42% | 3.9% | 1.6 points |
| 40% | 21% | 6% | 1.2 points |
| 40% | 42% | 6% | 2.6 points |
| 25% | 42% | 6% | 4.3 points |
| 40% | 42% | 12% | 5.5 points |
| 40% | 21% | 25% | 5.7 points |
| 40% | 42% | 25% | 13.5 points |
| 25% | 42% | 25% | 27.5 points |
Read the top of that table and financing looks like free money. A 4 percent program at a normal attach rate needs less than one extra job per 100 estimates to wash its own face. Against a measured 11 point lift, that is not close.
Read the bottom and the whole argument inverts. A 25 percent buy-down at a healthy attach rate needs 13.5 points, which is more than the best lift anyone has measured. On thin margins it needs 27.5 points, which is not a thing that exists.
Watch out
The break-even lift scales with your attach rate, so the sales advice and the financial advice pull against each other. "Lead with the monthly payment on every job" is genuinely good selling and it moves attach from 21 percent to 42 percent. On a cheap program that is fine. On an expensive one it doubles your break-even from 5.7 points to 13.5 and turns a marginal program into a losing one.
The same thing in dollars
One hundred estimates, a $14,000 average ticket, a 40 percent gross margin, and the ACCA attach rate of 42 percent once you lead with the payment.
No financing: 38 jobs closed, $532,000 in revenue, $212,800 gross profit.
| Dealer fee | Jobs closed | Gross profit | Fees paid | Net gross profit | vs offering nothing |
|---|---|---|---|---|---|
| 3.9% | 49 | $274,400 | $11,237 | $263,163 | +$50,363 |
| 6% | 49 | $274,400 | $17,287 | $257,113 | +$44,313 |
| 12% | 49 | $274,400 | $34,574 | $239,826 | +$27,026 |
| 25% | 49 | $274,400 | $72,030 | $202,370 | −$10,430 |
That last row is the finding worth sitting with. You closed 11 more jobs. You booked $154,000 more revenue. And you ended the year with $10,430 less gross profit than the contractor down the road who never signed a financing agreement at all.
Revenue growth from an expensive financing program is real and the margin loss is invisible, which is exactly why it goes unnoticed for years. It shows up as a bigger, busier, less profitable company. That is the same trap as buying growth through channels you have not costed properly, and it is worth reading alongside what a good cost per lead actually looks like for contractors.
Financing raises your close rate on the estimates you already have. It does not create estimates. If the real problem is that too few qualified homeowners are calling, Pavado builds the lead generation system that fills the top of the funnel, with a qualifying form that arrives with the answers attached so you are quoting people who can actually buy.
The hidden cost is cash flow, not the fee
The fee is the number everyone argues about. The funding schedule is the one that puts contractors out of business.
Many dealer-fee programs prohibit you from taking a deposit at all, and fund only after the job is complete, sometimes weeks after. Enhancify names this as one of the five standard drawbacks of the model: contractors cannot usually receive payment until after completion, which means fronting materials and payroll out of your own working capital on every financed job.
The reality varies more than the marketing suggests. A low voltage contractor on r/Contractor described the Wisetack timeline precisely: "Once the client confirms that the job is actually completed, they pay out the money via bank transfer which typically gets us the money within 2-3 days. Like if a client confirms the job Monday at 5 PM, we'll have the money Thursday or Friday every single time." A contractor working with GreenSky at a bath remodeller reported a different structure: "they give money in increments, 30 percent upfront, 70 percent upon completion."
Same category of product, completely different cash position. On a $14,000 job at 42 percent attach, a shop running 8 jobs a month is floating roughly $47,000 of materials and labour at any given time if the program pays nothing until completion.
Tip
Before signing anything, ask for three things in writing: the funding schedule, whether a deposit is permitted, and what triggers a funding hold. The contractor above had payment frozen simply because two identically priced jobs were financed in the same week and it tripped a fraud flag. Get the escalation path in the agreement, not in the sales call.
If your program blocks deposits, you are trading a deposit policy you control for a lender's payment terms you do not. That is a real loss, and the deposit rules that protect a contractor before work starts exist for a reason.
There is no such thing as 0 percent
Every promotional rate is bought. When a homeowner is offered 0 percent for 18 months, the interest still exists, and you are the one paying it. This is what a dealer fee is: you buying down the customer's rate out of your own margin.
Contractors work this out eventually, usually by reading their own paperwork. One r/Contractor operator: "I found the 0 percent financing to simply mean I was paying a larger fee when I looked at the docs. They suggested to hide the fees in my pricing." Another, more bluntly: "No such thing as 0 percent financing. Banks are not in the business of giving money for free."
A contractor running Wells Fargo Home Projects and Synchrony explained the mechanism from the merchant side without any cynicism at all: "Since I'm in control of the financing I control the interest rate and promo options. The lower the rate or better promo you give them, the more chop the bank takes, so you have to put that into your quote."
That last clause is the whole thing. The promo is a discount you fund and then rebuild into your price. Which raises the question everyone eventually asks.
Can you just charge more for financed jobs?
Your dealer agreement usually answers this before your state does. Many lender contracts require price parity between cash and financed customers, which is precisely why contractors are coached to build the fee into every quote as overhead rather than add it visibly at the end.
That has a consequence nobody selling these programs mentions. If a 12 percent dealer fee goes into your standard pricing across the board, you are now roughly 12 percent more expensive than the competitor bidding the same job without a financing program, on the 58 percent of jobs that never use financing at all. You have made yourself less competitive on most of your bids to win a minority of them. On a cheap program that is a rounding error. On an expensive one it is a structural pricing disadvantage, and it shows up as a slow, unexplained decline in win rate on straightforward cash jobs. If you are already losing bids you should be winning, sort out how you handle price shoppers before you add another point to your prices.
Read the price parity clause before signing, and take the state-law question to a local attorney rather than a lender's compliance page.
When the answer is genuinely no
There are four situations where the correct decision is not to offer a paid program, and no lender-owned article will tell you about any of them.
Your average ticket is under $5,000. The close-rate lift comes from customers who cannot pay the lump sum. Below roughly $5,000 most homeowners can already put the job on a card, so financing does not convert anyone new. It just applies a 4 to 6 percent fee to jobs you were going to close anyway. On a $1,200 repair at a 45 percent margin, a 6 percent fee is 13 percent of your gross profit for nothing.
Your work is discretionary rather than necessary. A furnace in February is a need. A pergola is a want. One contractor summed up the position honestly: "My niche is already an unnecessary luxury, if a client can't afford it outright then they really shouldn't be buying from me. I'd hate for a client to incur debt over something frivolous."
You cannot float the job. If the program blocks deposits and you do not have the working capital to carry materials and payroll to completion, the program will hurt you faster than the extra jobs help. Fix the balance sheet first.
You are trading on the trust of not being a high-pressure sales shop. This one is underrated. A homeowner post in r/hvacadvice that reached 363 upvotes included this line: "I read somewhere on reddit that companies that send you an invoice through email and offer financing are less trustworthy than guys that write you a paper invoice on site." That perception is unfair to plenty of honest operators, but it exists, and it is strongest in exactly the market segment that pays cash and refers friends. If your entire positioning is being the straight-talking alternative to the guy in dress boots quoting $16,000 at the kitchen table, bolting on a financing pitch can cost you more trust than it wins in volume.
Against all of that, hold the counter-case. A roofer six years into business, in the same thread where everyone told him to work for clients with money, said what the sceptics were talking past: "Been losing out on business due to not being able to finance some homeowners." He is right too. Both things are true, and which one applies to you is settled by your ticket size and your fee, not by which camp sounds tougher.
The five minute decision framework
Work through these in order. Stop at the first no.
- Is your average ticket above $5,000? If no, use a free referral link and stop here.
- Is your gross margin 35 percent or better? If no, you have a pricing problem, and financing will make it worse by adding a fee to a margin that cannot carry one.
- Can you carry materials and payroll to completion without a deposit? If no, only accept a program that funds a draw up front.
- Is the all-in fee under 8 percent? Compare against your break-even from the table above using your own margin and a 42 percent attach rate. If the fee needs more than about 4 points of lift, walk.
- Does the program soft-pull and route to more than one lender? Single-lender programs decline ordinary homeowners routinely. Enhancify reports that two of the most popular home improvement loan providers average a FICO near 770 at origination.
- Have you read the price parity clause and the funding schedule? If those two are not in writing, you do not know what you are signing.
Then measure it. Track attach rate, approval rate and, critically, close rate on financed versus unfinanced estimates for two quarters. If your close rate has not moved by more than your break-even number, cancel the program. Most contractors never check, which is why so many are paying for a lift they are not getting. One operator running Wisetack was refreshingly honest about the outcome: "I use wisetack and I like it, but it hasn't had a big effect on our business."
The honest version
Financing is a good deal at 4 percent, a judgement call at 12 percent, and a wealth transfer at 25 percent. The industry sells it as a yes or no question because the people writing about it are paid on volume, and volume is not the same as profit.
The 11 point close-rate lift is real, it is well measured, and on a $14,000 replacement it is worth more than $44,000 of extra gross profit per 100 estimates against a normal fee. The same 11 point lift against a 25 percent buy-down leaves you $10,430 worse off than doing nothing.
Same lift. Same jobs. Opposite outcome. The variable is the fee, and the fee is the one thing on the brochure printed smallest.
Start cheap, offer it on every job so you actually generate data, lead with the monthly payment, and re-run the break-even every time a lender offers you a better promo for your customer. That better promo is being paid for out of your margin, and you should know the exact price before you agree to be generous with it.