To help alleviate the ongoing credit crunch, a number of pool equipment manufacturers are offering financing for their products.
“When someone says there’s no financing available, that’s true for pool construction, but not for equipment,” said Rick Mills, vice president of business solutions at Zodiac Pool Systems in Vista, Calif.
Two of the industry’s three largest equipment manufacturers are participating in the GEOSmart Sustainable Financing Solutions program.
“Consumers are challenged with liquidity, and this was a natural place to get financing,” said Carlos Del Amo, vice president of marketing at Pentair Water Pool and Spa in Sanford, N.C. “We believe we’ve got an obligation to try to solve some of the overarching challenges that this industry has.”
Hayward Pool Products is exploring financing avenues as well. “We are pursuing some options similar to what other companies are doing,” said Mike Massa, vice president of sales at the Elizabeth, N.J., firm. “Pool financing is the major obstacle our builders are dealing with every day, and we would love nothing more than to offer them a reliable financing source to give them a nice shot in the arm.”
The GEOSmart program is administered by the Electric & Gas Industries Association, a nonprofit organization for advancing energy efficiency and renewable-energy usage. The credit program applies only to energy-efficient products approved by EGIA.
To acquire the financial backing, the Sacramento, Calif.-based EGIA negotiates with national lenders. GE Money is one such vendor.
So far, Zodiac and Pentair Pool Products have received EGIA’s approval on at least some of their offerings. Several solar pool heating manufacturers have likewise met the standards.
Homeowners can receive loans up to $25,000 for approved equipment and ancillary products, materials and labor necessary for installation. Within 24 hours of receiving a loan application, GEOSmart will reply. The dealer is automatically paid upon approval.
Consumers have a choice between deferred-interest and low-interest programs. The former charges no interest for a specific length of time, depending on the consumer’s credit and amount of purchase. The rate will then go somewhere in the low- to mid-20s.
The other program charges interest right away at rates as low as 7.9 percent.
Credit and terms will depend partly on FICO scores, with ratings of 680 and better often receiving approval, said Dave Warren, EGIA’s vice president of partner relations.
GEOSmart is available only for residential properties where a homeowner is involved. Unsold spec homes would not qualify, Warren said.
To offer the financing, contractors must apply through EGIA and pay $250. The fee is waived if buying from a manufacturer who participates in EGIA’s Energy Partner program, which is separate from GEOSmart. Zodiac has been an Energy Partner for approximately six months, while Pentair’s approval is expected soon. Both manufacturers promote the program and can help dealers sign up.
EGIA counts 2,500 contractors, distributors and manufacturers as its members, and said it has provided financing for more than 40,000 projects, in excess of $500 million.
The financing, in combination with energy-efficient products, should help close more sales and increase the amount per contract, Mills said. “Once they realize that it pays for itself, they will increase what they spend.”
Erika Taylor provided reporting for this story.