Shedding Light on Solar Panel Contracts

As Massachusetts continues to embrace green energy and homeowners increasingly consider solar panel installations, Norfolk County Register of Deeds William P. O’Donnell reminds consumers to thoroughly review the terms of their solar energy contract before signing.

“The growth of solar energy in Massachusetts is undoubtedly a positive step towards a sustainable future,” stated Norfolk County Register of Deeds William P. O’Donnell. “However, with this comes a heightened responsibility for homeowners to be diligent. While the cost of solar installation has significantly decreased over the past decade and a half, a system can still represent a substantial investment, often ranging from $18,000 to $30,000, and contracts can span two decades.”

Register O'Donnell highlighted a specific concern that often catches homeowners off guard: the filing of a Uniform Commercial Code 1 Statement (UCC-1) by solar companies.

Shedding Light on Solar Panel Contracts

“Many consumers are unaware that after signing a financing contract, a UCC-1 can be filed with the Registry of Deeds by the solar company without the homeowner's signature,” Register O'Donnell explained. “This effectively places an encumbrance on your home, similar to a lien, and it can only be discharged once your final payment is made. Unlike a mortgage, which requires the homeowner's explicit signature, a UCC-1 can be filed unilaterally by the company, making it easy for its existence to go unnoticed.”

Due to the presence of a UCC-1 encumbrance from solar panel agreements, homeowners might encounter difficulties or need to undertake additional steps when applying for home equity loans or reverse mortgages. Beyond challenges with refinancing or securing equity, homeowners with solar panel agreements can also face significant hurdles when it comes time to sell their property.

“There's a common misconception that the solar panel contract will simply roll over to the new owner. This is not always the case. If the buyer isn't approved by the solar company according to the terms of some contracts, the current homeowner may be forced to purchase the solar panels and equipment outright before they can sell their property,” stated Register O'Donnell.

In light of these complexities, Register O'Donnell strongly advised homeowners to seek professional legal counsel. “Whether you choose to lease or purchase your solar panel system, there are numerous intricate details within these contracts that demand careful attention,” he urged. “This is a major financial transaction, and I cannot stress enough the importance of having a licensed attorney review the contract before you sign on the dotted line. The devil truly is in the details, and legal review can save you significant headaches and financial strain down the road.”

Register O'Donnell concluded. “As the proverb states, 'Forearmed is to be forewarned.' I strongly recommend that any homeowner seriously considering solar panel installation visit the Massachusetts Attorney General’s Frequently Asked Questions About Solar Products for Customers page on their website.”

For Norfolk County homeowners who have entered into solar panel contracts and wish to check if a UCC-1 has been placed on their deed, they can contact the Norfolk County Registry of Deeds Customer Service Center at 781-461-6101 or visit their website at www.norfolkdeeds.org.

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The Norfolk County Registry of Deeds, located at 649 High St., Dedham, is the principal office for real property in Norfolk County. The Registry is a resource for homeowners, title examiners, mortgage lenders, municipalities, and others with a need for secure, accurate, and accessible land record information. All land record research information can be found on the Registry's website, www.norfolkdeeds.org. Residents in need of assistance can contact the Registry of Deeds Customer Service Center at (781) 461-6101 or email us at registerodonnell@norfolkdeeds.org.