PACE and HERO loans are turning mortgage lending upside down

Many homeowners using high interest Property Assessed Clean Energy loans (PACE) or locally known Home Energy Renovation Opportunity (HERO) in California; to finance home energy efficiency upgrades maybe placing themselves at risk. The National Consumer Law Center has received many complaints from many homeowners including seniors, non-English speakers, and lower-income homeowners. They were not fully informed of the consequences.

These types of loans get attached to the property itself and not to the homeowner. When the homeowner applies for a PACE loan, he or she passes the obligation of payment on to the next homeowner in case of a sale.

White House on board with PACE loans

The Obama administration pushed for the change in FHA policy. In July, the White House issued a press release, along with a video of President Obama touting clean energy savings.

Read the full story Andrea Riquir's article published on October 10th, 2016 here.
Source: MarketWatch