Furnace Rental Buyer Guide, Prices and Things to Know Before You Sign

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Everything you need to know about furnace rental for your home or business.

A furnace rental is something you might consider as a homeowner or business owner when you need a new heating system and don’t have the money to buy one. There are a lot of advantages to renting, including no upfront fees, convenience, repairs are covered, and fast service, but you end up paying a lot more in the end.

Should you consider a furnace rental?

We generally advise caution for consumers when considering rent-to-own HVAC equipment because of the onerous contracts most rental companies employ. We recommend finding alternative financing (e.g. from friends, family, a line of credit, through an HVAC company, etc.) when possible so you can buy your system instead.

Rent to own financing may make sense for some people, but it should be a last resort in most cases. BUYER BEWARE when it comes to door-to-door marketing companies.

Since 2018, Ontario has had a new law with more stringent rules on heating & cooling systems that are sold door-to-door, including rent-to-own programs. These new rules are designed to protect consumers and eliminate aggressive sales tactics. The provinces of Alberta and BC have similar laws.

We continue to urge caution when dealing with door-to-door HVAC salespeople. Always do your research and never sign anything at the door.

Another common tactic in recent years is to use deceptive social media advertisements on Facebook for instance, promising ‘free’ furnaces or other appliances.

Furnace Rental Agreement Types

Is Renting a Furnace the Same as Renting-to-Own?

In short, no.

Renting a furnace is like leasing a car: at the end of the rental contract, you may continue paying a monthly fee or face a buyout fee to terminate the agreement. Your options beyond paying the buyout fee to own the furnace, include renewing the agreement, or ending your rental and paying to have the furnace removed (although this is uncommon), or starting a new agreement with a new furnace installation.

Rent-to-own, on the other hand, is more like signing a contract for a new phone. When the contract is up, the furnace is yours.

However in practice, these terms are largely interchangeable and refer to a type of financing where the homeowner is essentially paying off the furnace over time, with varying terms and conditions for how the agreement is settled once the end of term is reached.

Alternatives to Renting a Furnace

Another option is financing, which is different from both renting and renting-to-own. Most established heating & cooling companies typically offer flexible financing options through third party financial partners. For more info, you can easily request a free quote from our local Certified Partners across Canada!

Find out more: https://furnaceprices.ca/posts/furnace-financing/

Furnace Rental Companies

There are a few large providers, such as Reliance Home Comfort, who offer HVAC services and furnace rentals Canada-wide. Depending on where you live, you may also find smaller local providers.

Many ordinary HVAC contractors may offer their own in-house rental-style financing options as well. In some cases, home improvement stores may even have partnerships with furnace rental companies.

Before selecting a furnace rental company, examine the rental terms, pricing, customer reviews, and the range of services offered. Additionally, ensure the company is licensed and has a good reputation for customer service.

How Furnace Rentals Work

Generally, the homeowner must sign the contract. If you rent your home, you may need the landlord’s approval and signature. After the contract is signed, the new furnace will be installed at a scheduled date.

You will get your new furnace immediately and then pay a set monthly fee for the agreed-upon period. This can make things simple from a budgeting perspective as there are no surprises and you know exactly how much you’re going to have to pay every month.

Price and Factors Influencing Furnace Rental Costs

Rental furnace costs will depend on a lot of factors, including:

• The length of the term
• The company you choose
• The furnace make/model/size/AFUE
• Your credit score
• Whether you have ductwork
• Whether you’re converting fuels
• And more

How much does it cost? Furnace rental costs generally range between $79.99 per month to $129.99 per month. Terms can be seven, 10, or sometimes 15 years. Installation costs are typically included, and most companies don’t require any down payments, so all you pay is the agreed upon flat monthly fee.

You can compare that to the normal cost of a furnace with installation (non-rental) with our furnace cost calculator.

TIP: Make sure it’s an Open Agreement, meaning you can buy out or pay off the unit at any time without penalty. It’s also a good idea to choose a company that offers Transferable rentals, so you can transfer it to a new homeowner should you sell your home.

Does renting a furnace save you money? Although a furnace rental has a lower up-front cost, you’ll end up paying more for the system in the end.

Furnace manufacturer, BTU output and efficiency rating

Furnace rental costs will also depend on the brand and model. Higher-end models manufactured by a company like Lennox will cost more than Goodman, for example. Although companies like Carrier and Lennox do make good products, in most cases you’re paying for the brand name. Because rentals are generally full coverage, you don’t really need to be as worried about reliability: repairs should be covered as part of your rental agreement.

Other factors that will impact cost are energy efficiency (AFUE rating) and size (BTU output) of the furnace. Larger and more efficient furnaces are more expensive.

Do you have good credit or bad credit?

Companies like Enercare (formerly Direct Energy) and Reliance Home Comfort generally only accept people with a high or good/excellent credit score.

However, certain companies are more forgiving and will accept homeowners with bad credit or who have declared bankruptcy. Just be warned they may charge more for bad credit rentals.

Are you converting from oil to propane or natural gas?

Conversions are more complex and will often result in higher installation costs and, therefore, a higher monthly rate. Conversions include oil to gas, oil to propane, or propane to natural gas conversion. 

Do you have ductwork in your home? If you currently have baseboard heating, radiators, or otherwise have no ductwork in your home, you must also consider the cost of having heating ducts installed throughout your home. Alternatively, consider a ductless heat pump rental instead

Furnace Rental Vs Purchase

Upfront costs: The main benefit of renting a furnace is that there aren’t typically any upfront costs, down payments, or installation fees. By contrast, you have to come up with thousands of dollars to buy and install a new heating system.

Same-day service: Most furnace rental companies offer installation within 24 hours and sometimes even same-day service.

Saving money on heating bills: This applies whether you rent or buy. Upgrading to a high-efficiency furnace can potentially save you hundreds of dollars every year.

Monthly fees: Furnace rentals come with a monthly rental fee that you don’t have to worry about when you buy a furnace. However, the monthly fee is predictable, with no unexpected expenses or repair costs.

Repair fees: With furnace rentals, repair and maintenance costs are generally covered. Furnace repairs can cost thousands, so make sure you get full-coverage protection on parts and labour. Rental contracts sometimes guarantee round-the-clock service as well.

Selection: Most rental companies only offer a few major furnace brands, so if you have your heart set on a less popular brand, it may not be an option.

Overall cost: The main advantage of buying a furnace is that you end up paying less overall. With a furnace rental, you end up paying a lot more for the furnace over the course of the rental term—and you may never end up owning the furnace.

Does a furnace rental contract affect the sale of a home? Most rental agreements can be transferred if you ever sell your home. If you think you might sell your home before your rental contract is up, make sure your agreement is transferable. However, there may be an additional fee. What’s more, not all homeowners want to take over a furnace rental contract.

Bottom Line – Is renting right for you?

In the end, it all comes down to what best fits your life, financial situation, and personal preference. If you have the cash to replace your furnace and worry about any maintenance and repairs as they come, then buying outright may be the best option for you.

People with disabilities or senior citizens may also benefit from the hands-off servicing and repairs that comes with rental programs.

It’s also important to consider how long you might stay in your current home. If you plan on selling your home before the rental contract is up, consider that most buyers may be reluctant to take on the rental contract which may force you to either pay the buyout or lower your selling price accordingly.

You might also want to consider simply getting a separate protection plan on your furnace rather than renting it.

Businesses, Rental Properties & Commercial Spaces

Additionally, some business owners (or tenants) prefer rentals for their commercial space or rental property. The main advantages for businesses and landlords are that furnace rentals provide a simple hands-off solution, which is often tax deductible. This is especially true if the houses or buildings you rent out/lease are in a different town or city than where you live. If there are ever any problems with the unit, the service calls are taken care of, which means one less headache to deal with.

Tips for Negotiating Furnace Rental Terms

• Find a company offering a hassle-free set-up and installation. Make sure they’ll also remove and dispose of the old unit too!
• Make sure the company is TSSA-certified (Ontario) or has applicable licenses and certifications for your region.
• Get a free quote or consultation! (Most companies should provide a free quote)
• Check out our current government heating & cooling rebates to find ways to save

Availability

Other Products Available for Rental: Ductless heat pumps/mini-split systems, central air conditioners, hot water heaters & tankless hot water heaters, boilers and combi boilers, water softeners, HRVs/ERVs

Geographical Availability: Across Ontario including Toronto, Ottawa, Barrie, Belleville,  London, North Bay, Sudbury, Brockville, Windsor, Sarnia, Leamington, Trenton, Brantford, Chatham, Owen Sound, Timmins, Sault Sainte Marie, Thunder Bay, Cornwall, Guelph, Renfrew, Hamilton, Kingston, Napanee, Cambridge, Oakville & Burlington, Kitchener, Stratford, Muskoka, Niagara, Peterborough, Kawartha Lakes, Pembroke, Petawawa, St Catharines, Norfolk County, Markham, Mississauga, Oshawa, Woodstock, and so on.

Some companies have also recently started offering this service in Western Canada in Winnipeg, Manitoba; Regina and Saskatoon, Saskatchewan; Edmonton, Alberta; Calgary, Alberta, and the Vancouver, BC area (including Richmond, Surrey, and Burnaby), among other places.

Ultimately, furnace rentals aren’t going to be the right option for everybody. But many homeowners reportedly enjoy the simplicity, convenience, affordability, low upfront costs, and peace of mind.

FAQ

How do I get out of my furnace contract?

To get out of a furnace rental contract, you typically have to buy out the contract, and that means paying the full balance of the agreement.

Can I purchase the furnace at the end of the rental contract?

Some rental and rent-to-own contracts give you the option to buy the furnace at the end of the rental period, but there’s usually an additional fee.

Are there any hidden fees associated with renting a furnace?

Some rental contracts will have an annual increase built into the rental fee. Check the contract to see how much more you’ll pay each year.

Can I choose my own service provider when I rent a furnace?

When you rent a furnace, you enter an agreement with the rental company for maintenance and repairs as well, meaning you can’t go to an outside HVAC contractor.