TALLAHASSEE, Fla. – A new bill in Tallahassee would set new rules to protect Florida homeowners who want to obtain clean energy home improvement loans.
PACE loans – or Property Assessed Clean Energy loans – were approved by the state legislature in 2010, but a News 6 investigation exposed some of the problems homeowners are facing after they sign on the dotted line.
One woman in Orlando, who was able to acquire her home with the assistance of Habitat for Humanity, said she did not realize the payments were made once a year – assessed with her property taxes.
She said the large payment was surprising, and she was in danger of losing her home.
Watch News 6′s PACE loan investigation
Another couple in Brevard County have two liens on their property now after their PACE lender pulled out of the state after they had their air conditioner installed.
The project was not fully funded, and they now owe more than $7,000.
Watch News 6 investigation into PACE lender that pulled out of funding:
“There has been a lot of predatory lending, where we have caught this niche of folks that are poor, and we continue to make poor people poorer,” said State Rep. Dana Trabulsy, R-Port St. Lucie during a committee meeting last week in Tallahassee.” That’s what this bill aims to address in providing a lot of consumer protections around the financing that we’re offering to homeowners.”
Trabsulsy authored HB 927, which, if approved, would rewrite the statute that created PACE funding.
It creates new safeguards to protect homeowners, and the financial institutions:
- Total loan amount not more than 20% of just value of property
- Mortgage cannot be more than 97% of just value of property
- Property taxes and mortgage debt are current
- No outstanding fines or liens or default
- No bankruptcy within the last five years
- No home equity or reverse mortgages
- Term of mortgage cannot exceed life expectancy of appliance (not to exceed 20 years)
- If project costs more than $10,000, homeowner must get price quotes from two unaffiliated contractors
- Funders must be able to show the homeowner can repay the loan
- Mandated phone calls with customers confirming what they are getting into
- Prior to disbursement, funders need to confirm all work has been completed
- Funders must post reports on their websites showing how much they’ve lent, and how many complaints they have received
State Sen. Jonathan Martin, R-Ft. Myers, authored the companion bill, SB 770, in the state senate.
“From what we all know about the PACE program, what we’ve seen on TV, this bill greatly improves the consumer protections, and it greatly improves the program,” he told a separate committee.
Both bills continue to pass committees furthering its chances of being approved by both houses.
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