Buying a Home with Leased Solar Panels?
Jill does a great job laying out some food for thought on solar leases.
This topic has become more and more important to residents of California and other places full of sunshine. Solar panels have been made so easy to get, with solar companies promising the world, only for home owners to later find out how much of a hassle they can be. Many times lease terms will compromise or make difficult the process of getting a mortgage. I've created a flyer with how solar affects each mortgage type and what we need in order to loan on a home with solar.
If you'd like a copy of the flyer just let me know and I'll be happy to send one over.
7 Things You Need to Know Before Buying a Home with Leased Solar Panels
Throughout Orange County, CA and beyond, many homeowners have added solar panels to their homes. Leased solar panels are a popular option. Find out how the seller's existing solar panel lease will impact your home purchase.
- The buyer must agree to take over the lease on the terms negotiated by and agreed to by the party who initiated the agreement. The seller will provide a copy of the contract for the buyer to read and review. Read it.
- Have questions about the contract? Contact the solar provider’s lease transfer department and they will answer questions regarding the solar lease agreement and transfer. If you’re given information that is not in the contract, get it in writing.
- The buyer must qualify with the solar lease company to assume the lease, which is generally pretty easy.
- The buyer must inform their mortgage lender there is a solar lease in place, as it may affect the lender’s ability to lend on the property. The lender will include the monthly cost of the leased solar panels into the buyer’s debt to income ratio. Though unlikely, it may impact the buyer’s ability to obtain financing.
- What if the buyer doesn’t want the solar panels? The cost to remove the solar panels can be the same as the lease buyout price. Check the terms of the contract before you take action.
- In a buyer’s market, it’s possible to negotiate for the seller pay off part or all of the solar lease.
- Once the last lease payment is made, what happens next? There may be a contractual requirement for the leased solar panels to be appraised. Should the buyer wish to keep the panels, they will need to pay the solar company the appraised value. If the buyer does not want to keep the panels, the solar company will remove them. There may or may not be a fee for removal.
Buying a house with leased solar panels is a personal decision and each buyer must decide what’s right for them. Consequently, it’s important understand that to which you are agreeing so you can move forward with confidence.
Written by Jill Murty and originally posted at JillMurtyRealEstate.com
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