Energy-efficient upgrades like solar panels, impact windows, and new roofing systems can add value to a Florida property, but how those improvements are financed matters if you plan on selling your home.

Why? Because in many cases, these upgrades are tied to PACE (Property Assessed Clean Energy) loans, and with them come liens that can complicate or delay a closing if not handled correctly.

For realtors, this is one of those issues that often surfaces late in the transaction unless it’s identified and addressed before the property is listed. Here’s what to be aware of when it comes to PACE loans in Florida.

What is a PACE loan?

PACE financing allows Florida property owners to fund energy-efficient or hurricane-resilient improvements with little to no upfront cost. Instead of a traditional loan, the amount is repaid through a special assessment added to the property tax bill.

While solar panel installations are one of the most common uses of PACE financing in Florida, it can also apply to roofing, generators, HVAC systems, and storm protection upgrades. The PACE assessment is tied to the property, not the individual borrower and transfers with the property unless it’s paid off. It is typically recorded as a lien.

Why Can PACE Loans Create Problems at Closing?

PACE loans aren’t inherently problematic, especially if the seller has been making payments, but during a real estate transaction, several complications can arise, including:

  • Lender restrictions for the buyer – Many mortgage lenders require PACE assessments to be paid off before closing. They often won’t approve financing if a PACE lien remains on the property.
  • Unexpected payoff amounts – Sellers are sometimes surprised by the remaining balance, especially if they assumed the assessment would transfer to the buyer.
  • Last-minute delays – If the lien isn’t identified early, payoff coordination can push back closing timelines.

How Do Solar Liens Affect a Sale?

Solar panels can add another layer to real estate transactions in Florida, as installations may involve more than just a PACE lien. Depending on how the system was acquired, there may also be equipment financing agreements, leases or power purchase agreements (PPAs), or UCC filings tied to the equipment.

Each of these structures carries different implications for a sale. Some may require payoff, while others may require buyer approval and transfer agreements. If not properly reviewed, these details can create confusion — or stall a deal entirely.

What Should Realtors Address Before Listing?

The best time to deal with a PACE loan or solar lien is before the property hits the market. Realtors should encourage sellers to:

  • Confirm whether a PACE loan exists – Review property tax bills and financing documents.
  • Request a payoff statement early – Understand the balance and any prepayment requirements.
  • Identify how solar panels are financed – Determine whether they are owned, financed, or leased.
  • Gather all related documentation – This includes agreements, warranties, and lien records
  • Discuss strategy with a title company or attorney – Decide whether to pay off the lien or prepare for transfer (if applicable)

Addressing these items upfront helps avoid surprises during escrow and keeps the transaction moving.

Who is Responsible for Paying off the Lien?

In most Florida transactions, the seller is expected to pay off PACE loans and related liens at closing. However, like many aspects of a real estate deal, this can be negotiated.

In some cases, a buyer may agree to assume the assessment, but this is less common and often limited by lender requirements. Either way, clarity is critical. These terms should be addressed early and documented clearly in the contract.

Keep Your Listing, and Your Closing, on Track

PACE loans and solar liens aren’t deal-breakers, but they are deal-changers if they’re discovered too late. For realtors, identifying these issues early is one of the simplest ways to protect your client, avoid delays, and keep transactions moving smoothly.

If you’re listing or purchasing a property with solar improvements or PACE financing, having the right team in place can make all the difference. We’re here to help. Contact our team at the Law Offices of Alex D. Sirulnik, P.A. and ADS Title Services, Inc. today to schedule a free consultation.

FAQs

PACE stands for Property Assessed Clean Energy. It’s a financing program that allows Florida homeowners to fund energy-efficient or storm-resilient improvements, like solar panels, roofing, or impact windows, with no upfront cost. Repayment is added to the property tax bill as a special assessment tied to the property, not the borrower.

In most cases, yes — unless it’s paid off at or before closing. The PACE assessment is a lien tied to the property, and most mortgage lenders require it to be satisfied before approving financing for the buyer. Sellers are often surprised by the remaining payoff balance if they assumed it would simply transfer.

It depends on how they’re financed. Solar panels can involve a PACE lien, an equipment financing agreement, a lease, or a power purchase agreement (PPA). Each carries different implications at closing — some require payoff, others require buyer approval and a transfer agreement. Identifying the structure early is critical.

Before listing, realtors should confirm whether a PACE loan exists by reviewing property tax bills, request a payoff statement, identify how solar panels are financed, gather all related documentation, and consult with a title company or real estate attorney. Addressing these items before listing avoids delays during escrow.

In most Florida transactions, the seller pays off the PACE lien at closing. However, this can be negotiated. A buyer may agree to assume the assessment in some cases, though lender approval is often required. Any agreement should be clearly documented in the purchase contract.