SOLAR PANEL LEASING: SOLUTION OR HEADACHE?
Solar leasing has become a big part of the solar industry, which is growing quickly as consumers scramble to “go green” and reap the benefits of not only helping the environment, but the promised energy savings. The problem with solar power is the initial cost of the panels is significant, this is where solar leasing comes up. Companies are offering the initial benefits of solar power, while spreading the cost of the panels over as many as 20 years.
Whether or a lease is a good option or not depends upon the circumstances, but there are a number of things to consider when evaluating the benefits. It is worth noting that by leasing the panels you may not be entitled to the energy tax benefits which might be available in a purchase. Another issues is the overall look and efficiency of the panels. This is a growing technology and the panels in ten years, let along twenty years are likely to be very different in both aesthetics and efficiency. Leasing them ties the lessor to today’s technology for the long term.
The biggest issue with leasing is that it can create problems when selling your home. The average homeowner lives in the home for 16 years, so the likelihood is that the home will be sold prior to the end of the lease. The issues arise because the lease creates a lien or encumbrance on the home which must be dealt with before the sale can close. This means that it must either be paid off, if that is allowed under the lease, or the new buyer will have to qualify for the lease. Setting aside those buyers who may not want solar panels on the home for aesthetic reasons, a buyer may not qualify for the lease, meaning a potential sale voided due to the solar lease.
This does not mean that solar leasing has no utility, there are circumstances where it can be beneficial. One example might be a retiree who has limited income, knows they will be in the home for the next twenty years and wants the benefits of energy savings. Even in that circumstance however careful thought should be given to how it might impact future events should the homeowner pass before the lease is completed. In short, no matter the circumstances, the use of a solar lease is one which should only be undertaken after careful consideration of the possible issues which may arise as a result of the commitment