Welcome to our 5-minute guide to replacing new boilers on finance.
The boiler replacement industry is a busy one. There are plenty of companies fighting for your business.
And just as sites like Amazon would fail without an online payment option, the same goes for boiler companies that don’t offer their new boilers on finance.
The problem is, not only do you need to pick the right boiler, you need to pick the best installer (that’s offering a good finance deal) – that can be confusing.
This 5-minute guide is going to cover everything you need to know, from expecting monthly repayments, through to APR rates, and even tricks (some) companies use to cover the cost of their so-called “0% APR” deals.
How Boiler Finance Can Actually SAVE You Money
There’s a certain group of people that can benefit from boiler finance deals a lot more than others; those that have an appliance that’s out of warranty.
If you have a new (ish) boiler that’s still under warranty, you’ve got two things on your side:
- A manufacturer that should replace any parts when they malfunction
- An efficient boiler that’s low on energy bills
For those with an older boiler you have neither of those things, and that means you’re losing money daily.
Here’s how much…
New boilers are nearly all, A-rated. And that means they’re efficient.
If you’ve got an extremely inefficient boiler (an old G-rated one for instance) and a large property, you’re losing a tonne on energy bills.
According to the Energy Saving Trust, this could be setting you back up to £320 per year.
That’s up to £26.67 per month that you’re losing out on.
Boiler Repair Costs
So, you’ve got a boiler that’s out of warranty? That’s bad news.
Boilers tend to malfunction more and more, the older they get. That’s the #1 reason manufacturers set their warranty the way they do – they don’t want to pay to fix your boiler, they want you to buy a new one.
Unfortunately for us, that means any repairs need to be paid for out of our own pockets.
I’ve created a quick-fire guide to boiler repair costs here.
As you can see, on an average repair, you’ll be lucky if it’s less than £300.
Types Of Boiler Finance Packages
Now, let’s jump into the different boiler finance packages on the market.
Most boiler finance companies build-in all or some of the features below, to suit your financial position.
APR Rates – 0% Interest Free And Upwards
Jump on a few top boiler websites, and you’ll see that typical rates are around 12.9% APR.
Now, I’m not going to screenshot and upload those rates – I don’t want to get sued.
There are better and worse options out there.
The best deals are 0% and interest free. The highest APR rate I found was 21.9%. That’s a tonne by the way.
If you don’t have the cash, can’t find a deal in the 0% APR – 12.9% APR range, I’d seriously consider a loan from a high street bank. You should be able to get one below 10%.
Also, bear in mind that the difference between say 10% and 20% APR, could add on around 1 year of repayments on a 10-year boiler finance deal.
Monthly Repayments (From £19 Per Month)
Once you’ve found a reasonable provider that offers boilers on finance, you’ll need to set your monthly repayment.
If the APR is anything above 0% interest, you want to pay it off as soon as possible (unless you have higher APR debts such as credit cards, in which case, pay those off first).
Obviously the lower the monthly repayment for your boiler finance deal, the longer it will take to pay off.
So, £19 per month might sound good, but that’s going to take 10+ years to pay off.
Repayment Term (From 2-10 Years)
So, the repayment period in mind, try and set a monthly repayment that’s affordable, but pays off the boiler as soon as possible.
Typically, you’ll find that almost all companies offering boilers on finance will have options from 24-120 months.
For most people, this is an important one.
If you’re looking for boiler finance, you don’t have the cash to pay for a new boiler upfront. That’s understandable, it’s a big investment and usually one that needs to be made unexpectedly.
That’s why most boiler finance deals can have a deferred initial payment option built in.
Basically, you won’t have to pay anything for the first 1-3 months.
That gives you the opportunity to sort out your finances in time for the first payment.
But, you’ll be able to get your boiler replacement straight away.
Boiler Finance If You Have Bad Credit
So, you could be looking at payments from £19 per month and deals as low as 0% APR (i.e. interest free).
But, that assumes you’ve got a good credit.
What about boiler finance for people with bad credit rating?
You’ll need to speak to each company on an individual basis about this. There are definitely companies offering boiler finance for those with bad credit ratings.
What you should expect is a higher interest rate in comparison to someone with a good credit rating.
Basically, it’s unlikely that you’ll be getting an interest free boiler on finance.
Where To Find Boiler Finance Deals
Even local installers have started offering boilers in finance. As many use similar finance providers as the large boiler installers, they can offer competitive finance deals (interest free, £19 per month etc) too.
And, on that note. Remember that a local installer (or at least, a smaller installation company with just a few employees) is going to be much cheaper than a large national.
In these cases, there’s a good chance you can save up to £1,000 on your repayment total, by getting a competitive quote.
The most important thing, is to get multiple boiler finance quotes.
That’s not just so you can compare interest rates and overall repayments, it also gives you a chance to see what boilers are being recommended.
Comparing Boiler Finance Quotes
Don’t get completely bogged down by the APR rate.
If the installation cost is high, the interest free rate really makes no difference.
Basically, you could get a 0% boiler finance deal, and pay more monthly and over the whole repayment period than another consumer that’s paying 9.9%.
So, you’ll want an itemised quote for your boiler installation.
That way, you’ll be able to see which quote is best (based on price alone), but also compare things such as:
- The boiler being installed. Is it a cheap boiler, or high quality one like Worcester Bosch?
- Is the installer also fitting a magnetic boiler filter and scale reducer to protect your investment?
- Does the cost include an initial hot flush, to ensure any heating sludge is out of your heating system before the new boiler is installed?
Pay close attention to the itemised finance quote.
One installer might seem incredibly cheap, but once you break down the quote, there’s a good chance you’ll see why.
Which Boiler Brand Should You Choose?
Now you understand a few of the basics when it comes to getting boilers on finance, you’ll need to start thinking about the boiler brand you want.
Maybe you’ve already chosen?
Stop right there.
You need to get a Gas Safe engineer to come and spec your property. The boiler installed isn’t necessarily the most suitable for your property (technology changes over time).
Boiler brands offer a range of options including:
- Multiple fuel types (LPG, Gas, Oil, Electric)
- Different KW outputs for different sized properties
- Compact boilers that are suitable for smaller installations (a typical example would be a kitchen cupboard)
- The list goes on…
When a boiler engineer visits to offer a quote for boiler finance, they need to consider:
- Property size
- Number of bathrooms
- Number and size of radiators
- Overall hot water and heating demand
They’ll then offer you a few suggestions on the best brand to install, and the model.
My suggestion is take their advice, if they plan to fit one of the following brands:
- Grant (Oil)
- Ideal Boilers
- Worcester Bosch
There’s not much debating to be done here.
Most top-quality boiler engineers will agree that those are the brands to be installing.
A Word On Boiler Warranties
Now, this is an important one.
Hopefully you’ve taken my advice and are choosing a replacement boiler that comes from the list of brands above.
But, within those brand’s model line-up, there are boilers with low warranties.
A low warranty is 2-years. We always advise people to get a replacement that has at least 5-years, with 7-years being preferable.
There are even warranties on offer up to 10-years.
But, to get these warranties, you’ll usually need your installer to be an accredited installer for that brand (for instance, a Worcester Accredited Installer can offer warranties of up to 10 years).
So, make sure you research the terms and conditions of the manufacturers warranty. If it needs an accredited installer for that specific brand – make sure your installer has that accreditation.
Thanks for reading our 5-minute guide to getting a new boiler on finance.
Ready to get some boiler finance quotes?
Hopefully this guide has given you enough information to decide on whether to explore boiler finance deals further, or to simply save up the cash and pay for your boiler upfront.
Still confused about your boiler finance options?
Or, not sure a recent boiler quote you’ve had is a rip off?
Put together as many details as you can and leave a comment below – we’ll get back to you as soon as possible.