Mrs DX and myself sold out current house and are looking at a house today that has leased solar panels. It looks like the panels are a under a 25 year lease plan and cost is roughly $85 a month. How does this setup work? Does your electricity bill go down as a result of the solar juice coming from the panels to power your house? Are there hidden things to watch out for with a setup like this?
The main things to check is if your lender will lend with them installed (as you don't own them) and if the lease is assumable with the original terms. You have no contract with the solar company, the seller does.
As far as the bill going down, it should, and hopefully more than the $85. The seller should be able to provide that proof. If they try to say "it's for the long run after the lease is over" ask how that worked out for them.
If I was choosing between a few houses, that one would be at the bottom, unless the seller was willing to remove them.
If it's a lease then are the panels staying after the lease is over?
The documentation appears that the lease started April of this past year. It looks like the panels get carried over to the next person who buys the house and also it is mentioned in the house description.
In reply to dxman92 :
Just because the Realtor thinks they transfer, does not mean they will. 90% of the large mortgage players require the seller to pay them off at closing so there's not an additional lien on the house.
Do you want to be attached to a company you did not choose for the next 24 years? Who is responsible for removal when it's over? What if they're out of business? What does your realtor say?
I read a article this morning on Business Insider about how the leased solar business is on the verge of collapse. I would be very wary of any involvement with it.
I think your realtor is misinformed.
The leased panels probably have a lien against the property. Your lender won't want that lien to exist after closing (and neither will you). They will require it be paid off at closing.
If the seller is paying off the panels as part of the deal before closing, then you get free solar panels. If the solar company is gonna remove them at the end of the lease, then make sure the roof have been properly repaired after removal.
Definitely get the terms of the agreement in writing. My inlaws sold their house to their son and the solar company had all kinds of issues. They ultimately paid to have them removed because the deal was with my inlaws, and the solar company was going to charge a much higher price to my brother in law.
As mentioned above, leased systems usually need to be paid off and bought outright or removed when a house is sold. That's the big catch on the "free" solar that places advertised.
Are there any specs on the system available?
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