[embedded content]
Consumers are falling prey to scams that have proliferated under largely unregulated loan programs designed to help homeowners make energy-efficient upgrades to their properties.
Consumer groups allege the program is often used to sign consumers on to high-risk, high-interest-rate loans, often with little knowledge of the terms of repayment or the possibilities of mortgage default and foreclosure.
Residential Property Assessed Clean Energy programs are a type of loan overseen by state or local governments that allows private lenders to fund certain energy-efficient and renewable energy projects that often carry high upfront costs.
These projects range from the installation of solar panels or more efficient doors and windows to water efficiency upgrades and in-home electric vehicle charging.
But there are few protections afforded to consumers who utilize the loans, according to consumer protection groups. Unlike other loans, PACE financing is secured through a property lien placed on a borrower’s home and does not require lenders to weigh factors such as a borrower’s credit score or history before lending the money. They also require zero down payment, an alluring benefit for many borrowers.
But the terms of repayment are …