Suppose you’re a seller contemplating selling a home with solar panels.

In that case, you’ll need to know the basic lending guidelines (that apply to any future buyers) before you go through the aggravation of listing your home!

 

Sellers have only one option: to pay off the solar lease(s) at the close of escrow, which most sellers can’t or are reluctant to do.

Despite what is being touted to the homeowner, properties with Property Assessed Clean Energy (PACE) & Home Energy Renovation Opportunity (HERO) aren’t eligible for Fannie/Freddie/FHA/VA financing without the solar lease being paid off.

That’s because the lease is really a lien (on title ) and has a “super-priority lien” position that can be found on the title company’s prelim.

In other words, PACE /Hero liens are given “first position” status on the homeowner’s mortgage, so if the homeowner later wants to refinance the mortgage, seek a loan modification, or sell the home, they’ll be forced to pay off the entire solar lien first.

As a seller, not disclosing either of these 2 types of leases, crashes the transaction may have legal ramifications for your agent and your broker.

Daniel Dobbs (.org)

Mutual Home Mortgage
265 S. Randolph #120
Brea, Ca. 92821
Cell: 949 250-3981

Dandobbs6@gmail.com
BRE # 00986886 …..NMLS# 307631

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