Contractor Financing Guide · Decision

How to Choose a Financing Platform

By the Hearth team · Last updated: July 2026

TL;DR

The short answer

Five questions sort the market: (1) How many jobs will you finance a year — flat fee vs per-transaction hinges on it. (2) One lender or many — marketplaces approve a wider credit range. (3) Who pays the fee — subscription, transaction fee, or a dealer fee hidden in your bid. (4) Where does it live — standalone link vs inside your FSM. (5) Is the lender actually originating — the category has had bankruptcies and shutdowns.

Start with your volume, not features

Count last season's quotes over $8,000. That's your financeable base. If financing would touch a handful of jobs, pay-per-use is rational. If it's monthly, a flat subscription (Hearth: most companies invest $2,000–6,000/yr, $0/loan) converts a variable cost into fixed overhead — worked example on our fees page shows 20 jobs × $12K at 3.9% is $9,360/yr against a typical $2,000–6,000 subscription.

Then stress-test approvals

Your customers' credit is a distribution, not a number. Single-lender programs live and die on one underwriter's box. Marketplaces hedge: Hearth's 18-lender network produces offers down to ~550 FICO on some products, and homeowners seeing 4–5 offers fund at nearly twice the single-offer rate. Ask any vendor: how many lenders, what credit range, what share of applicants see at least one offer?

Check the plumbing and the counterparty

Plumbing: does financing appear where you sell (quote, invoice, website, text)? FSM-embedded options win on workflow; standalone links win on flexibility. Counterparty: ask when the program last changed its lender lineup, and whether it's still originating — Mosaic's 2025 Chapter 11 stranded a lot of solar dealers mid-season.

FAQ

What's the single most important question?

Annual financed volume. It determines whether a flat fee or per-transaction pricing keeps more of your margin.

Should I run two platforms?

Some contractors do (FSM-embedded for small tickets, marketplace for big ones). Total both fee lines before deciding it's worth paying twice.

What red flags should I watch for?

Vague answers on lender count, fees that only appear in the merchant agreement, promo products whose dealer fees force you to pad bids, and any program that can't clearly state its origination status.

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Keep reading: What is contractor financing? Fees explained 2026 company guide