Comments : Could solar panels prevent you from selling your property?

Posted: 27/03/2012

There are two options to take when having solar panels fitted to a property; the first is where the home owner pays for the solar panels themselves and the second involves a lease agreement where a home owner rents their roof to a solar panel company, in exchange for free electricity. This second set up could prove tricky if you wish to sell your home. It seems that mortgage lenders are turning down applications from people who wish to buy a property that have a solar panel lease agreement set up.

Why is this?

Before the installation of the solar panels, the home owner has to agree to lease their roof for around a 25 year period to the solar panel company. Then the homeowner has to inform the mortgage lender and based on their opinion, the lease is either agreed or declined. This is obviously based on if you have a mortgage on your property.

The reason why a mortgage lender may decline the lease is because of the viability of the ‘rent a roof’ scheme which could cause a lot of legal disputes if the property has to be repossessed. This is where selling a property with this scheme in place may be difficult as mortgage providers are becoming reluctant to lend money to buyers because of the outstanding lease agreement.

If you have solar panels on your roof under this ‘rent a roof’ scheme and are considering selling your property, our advice would be to dig out the paper work and have a thorough read through the fine print. The lease company may only remove the panels if the lender can show it has tried and failed to sell the property. This issue does not affect any home owners who paid for their solar panels to be installed.

 

Amanda McGovern, Pali Ltd
www.paliltd.com

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nick says ...

‘Hi Indah, This blog relates to solar panels installed in UK which is different. Here the insatllation does have a seperate meter to show the electricity generated and also the power company does pay into your bank the money generated. Nick.’

Indah says ...

‘The sharing the cost part is not hard. The cost would cnilude the [hopefully professional] install, including permits and fees. And you would share in the rebates. As far as any tax credits, most likely, only one person would take them, and would pay the equivalent of 1/4 of the amount each to the other two parties.Now, the hard news. Solar is not a big moneymaker. It can save money, but it is more of a money *saver* than maker. In most states, the power company doesn't write an actual check for the electricity generated all they do is measure the net energy usage, and bill for that. So if a bill used to be $100 a month, and is now $40, it's hard to determine how much of the difference was due to the solar panels' input, and how much was due to plain old conservation. To be fair, you would need a separate meter to measure the solar panels' output. Also, it is normal for solar panels not to break even for 5-10 years. And in some places, the panels will never break even.I'm a’

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