What seemed like a straightforward investment turned messy for one house flipper when a default notice exposed an undisclosed lease tied to rooftop solar panels.
According to the buyer, the problem did not surface until three months after closing, creating a costly obstacle with a home they had hoped to resell in the near future.
Here's what to know
The homeowner said on Reddit that a default notice appeared after the sellers fell behind on a solar agreement the buyer said was never disclosed.
"I recently purchased a house, and three months later I learn that there is an existing solar lease," the original poster said. "No UCC filing was found hence title not catching it. Seller has told us the solar did not have any loans or liens."
They said the transaction went through a wholesaler rather than a realtor and that the purchase agreement treated fixtures as part of the sale. "I have no interest or plans to transfer the lease or take on any financial obligations," the OP also stated.
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More background
In the comments, one person said they abandoned a home purchase after the sellers claimed disclosures showed no solar lien or lease but they would not sign an agreement guaranteeing any such debt would be paid off at closing.
That user said the remaining balance was "something like $65k."
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Another person cautioned that reselling the property could be difficult, warning that the OP may have "a tough time flipping it with panels that can't be used."
What can be done?
The buyer said they had contacted the solar lender "to try to get ahead of things" and that they had asked whether the company could remove the panels. They also questioned whether that was the best move since the panels could be enticing to a future buyer if they were no longer tied to a lease.
"Don't assume the seller's debt is now yours," one user said. "Don't acknowledge the debt or make any sort of payments."
Others suggested notifying the title insurer, leaving the panels alone, and bringing in a real estate attorney before attempting a removal that might damage the roof.
More From EnergySage
💡Go deep on the latest news and trends shaping the residential solar landscape
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Adding battery storage to a solar setup is also one of the best ways to protect your home during outages, save money on energy, and go off-grid. Homeowners can explore EnergySage for information about home battery storage options, including competitive installation estimates.
Where can I learn more?
Here are a few similar cases involving homebuyers and homeowners who ran into solar lease problems during a sale or after closing.
• A first-time buyer hesitated after seller's lawyer sent a contract with a hidden solar lease.
• Another buyer hit trouble after purchasing a house with leased solar panels an attorney missed.
• In Florida, a buyer faced a surprise $20,000 charge over solar panels before closing.
• A new homeowner got stuck with an inherited solar lease and questioned the panels' output.
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