I was out and about last week and in just few blocks sighted six homes in our neighborhood with solar panels. As the daughter of an early environmentalist, seeing so many houses with solar power supplementation excited me. As a mortgage professional I wondered how having solar power might impact the mortgage qualification process.
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While further researching this topic, I found there are mortgage rules surrounding solar panels to keep in mind when investing in alternative energy production.
The biggest question to remember when thinking about updating your home to a solar panel system: does the homeowner own the solar panels or is the equipment leased or being paid for under an agreement with the solar company?
If you own your solar equipment you should be fine to sell your home later at any time. Complications can arise when you do not own the equipment. I would suggest that if you consider installing solar power, have a lender review the contract to determine if there could be any issues with future financing. Leasing solar panels can make an impact should you decide to sell your home at a later date.
Complications that can arise with leased solar equipment:
1. The solar panels may not be included in the appraised value of the property
2. The buyer may have to qualify with the solar lease payment included in their ratio
3. Traditional electrical services to the house must be maintained and functional
4. There are insurance requirements, and other issues to address that make financing a property with leased solar equipment more challenging
