Solar Leases and Their Impact on TitleBy Barbara Pronin
Rising utility costs and growing environmental concerns are boosting a commitment to solar energy. In fact, the number of houses with solar panels has increased tenfold in just the past seven years, according to the Solar Energy Industries Association.
Because leasing helps homeowners avoid the upfront costs – typically around $20,000 – many lease their solar energy equipment through independent solar energy producers. The process is fairly simple. Approved homeowners sign a contract, usually for a 20-year term, and/or a Unified Commercial Code-1 (UCC-1) financing statement filed by the provider, and documents confirming the provider’s interest in the leased equipment are recorded in the county recorder’s office. But what is the impact of solar lease contracts when the property is listed for sale?
In any case, your title partner should notify you when evidence of a newly discovered solar lease turns up. You can help avoid closing delays by advising your clients to make arrangements for the required transfer or buy-out procedures in a timely manner. Barbara Pronin is an award-winning writer based in Orange County, Calif. A former news editor with more than 30 years of experience in journalism and corporate communications, she has specialized in real estate topics for over a decade. |
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