Are you a property owner who is interested in the Property Assessed Clean Energy (PACE) program? While this program has been widely popularized through states across the country, this clean energy program helps finance environmentally conscious constructions. Our experts at National Tax Group want to help. Here is our guide on how to qualify for PACE.
How Does the PACE Program Work?
The PACE program is a great way for contractors and property owners to finance upfront costs of energy-efficient or other reliable improvements on a property. Participants are then able to pay the costs back over time, typically 10 to 20 years, through a voluntary assessment. The PACE program is one of the only programs that allows the assessment to be attached to the property rather than the individual.
With this type of financing, the property is collateral and the debt is tied directly to the property. Any balance on a PACE loan remains intact when ownership of the property changes. Additionally, PACE does not typically require an upfront down payment.
PACE loans do not require monthly payments like traditional loans. Instead, the loan is paid when the property is assessed in addition to regular property taxes.
How to Qualify for PACE Financing?
A PACE financing loan requires eligibility on a range of factors. These can include the equity you have in your home, your payment history on your mortgage, and your ability to repay the property assessment. If you decide to pursue the PACE loan, keep in mind that an individual’s FICO credit score will not be as big of a factor.
Additionally, there are eligible improvements to keep in mind when applying for PACE. Some qualifying energy-efficient specific improvements are lighting upgrades, HVAC systems, building envelope & insulation, automatic building controls, variable frequency drives, boilers & hot water heaters, roof replacement, and water conservation. Renewable energy improvements can include solar PV, solar thermal, microgrids, and EV charging stations. Other resiliency improvements can also be included under PACE financing like seismic resilience, hurricane resiliency, stormwater management, and fire resiliency.
How Can PACE Financing Help You?
PACE financing allows building owners to invest in their property while also lowering their carbon footprint. If you are interested in further pursuing and determining how the PACE program can help you but don’t know where to start, it is best to work with a tax group that specializes in this area. Our experts at National Tax Group are ready and excited to help you start on this project. Please contact us today to find out more about the Property Assessed Clean Energy Program.