Last updated: July 28, 2026
Bottom line: PACE is financing, not a grant. A “free solar” or “free roof with solar” offer usually means a loan, property-tax assessment, lease, power purchase agreement, insurance claim, or cost added to another contract. Before signing, get the cash price, full financing terms, roof scope, cancellation notice, and written answer about liens, property taxes, escrow, sale, and refinancing.
A salesperson may say there is no upfront cost, the government will pay, the roof is included, or your energy savings will cover everything. Those words do not tell you who owns the system, how much you will owe, or what happens if you sell the home.
This guide explains residential Property Assessed Clean Energy financing, commonly called PACE, and the most common “free” solar or roof offers. It also covers major 2026 changes. The federal homeowner solar tax credit is no longer available for expenditures made after December 31, 2025, and the federal Solar for All program was terminated in August 2025.
If you are mainly trying to repair a failing roof, compare this guide with our pages on roof repair assistance and free roof claims. Do not let an urgent leak force you into a long contract you have not reviewed.
What “free solar” or “free roof” may really mean
| Claim | What may be behind it | Main question to ask |
|---|---|---|
| “Free solar panels” | A lease or power purchase agreement where a company owns the system, or a loan with no down payment. | Who owns the panels, and what must I pay over the full term? |
| “Free roof with solar” | The roof price may be added to a solar loan, PACE assessment, lease pricing, or contractor contract. | Show me the separate cash price for the roof and solar work. |
| “Government solar program” | A real local program, a private company using official-sounding words, or an outdated reference to a canceled federal program. | What government office runs it, and can I apply through that office directly? |
| “Pay through your taxes” | PACE financing repaid as a special assessment on the property-tax bill. | How much will the annual tax assessment and mortgage escrow payment increase? |
| “The tax credit pays for it” | An outdated or misleading sales claim. The homeowner federal residential solar credit ended for expenditures after 2025. | Give me the full price without assuming any tax credit. |
| “Insurance will buy your roof” | A claim for covered storm or sudden damage, not ordinary age, wear, or maintenance. | Has my insurer approved the damage and written scope? |
The Federal Trade Commission warns that promises of free rooftop solar or a government program covering the full cost are likely scams. Some households do receive real subsidized solar, weatherization, or repair help, but those programs have clear service areas, eligibility rules, funding limits, and an official application process. Review the FTC’s solar scam warning before sharing personal information.
How residential PACE financing works
PACE finances certain home improvements and places the repayment on the property as a tax assessment. It may be offered for solar, roofing connected to an eligible project, heating and cooling equipment, storm protection, water-saving work, or other improvements allowed by the local program.
PACE is not available everywhere. There is no single national PACE application, income limit, maximum amount, interest rate, fee schedule, or repayment term. State law, the local government program, the PACE administrator, the project, and the homeowner’s finances control those details. The CFPB PACE guide says repayment may last five, 10, or 20 years.
Payments are commonly collected with property taxes. If your mortgage servicer pays taxes through escrow, the new assessment may cause your monthly mortgage payment to rise. If you pay taxes directly, you must save enough for the larger tax bill.
Home-loss risk: Falling behind on a PACE assessment can become a property-tax problem. Depending on state and local law, unpaid taxes and assessments can lead to penalties, a tax sale, or foreclosure. Do not sign because a salesperson calls the payment “just a tax benefit” or says it is not real debt.
Federal protections that took effect in 2026
The Consumer Financial Protection Bureau’s residential PACE rule became effective March 1, 2026. It applies mortgage-style Truth in Lending Act protections to covered PACE transactions. The rule requires standard disclosures that help consumers compare costs and requires a reasonable, good-faith ability-to-repay determination. Read the final PACE rule.
These protections matter, but they do not make every offer affordable. You still need to compare the annual percentage rate, fees, total of payments, property-tax increase, contractor price, expected savings, and cost of other financing.
Sale and refinancing problems
A PACE assessment can make selling or refinancing harder. Fannie Mae generally will not purchase a mortgage secured by a property with an outstanding PACE obligation that has priority over the first mortgage. Its current guidance may require the PACE balance to be paid off at or before closing. Freddie Mac also requires mortgages it purchases to remain in first-lien position.
Review the current Fannie Mae PACE rules and Freddie Mac guidance. Then ask your mortgage servicer and a future lender how the specific assessment would be treated. Do not rely only on a salesperson’s statement that the assessment “automatically transfers” to any buyer.
The federal homeowner solar credit ended after 2025
This is one of the most important facts to check in any 2026 solar pitch. The Internal Revenue Service says the Residential Clean Energy Credit is not available for expenditures made after December 31, 2025. A salesperson should not reduce a 2026 proposal by an assumed 30% homeowner federal credit.
Read the current IRS solar credit page and the IRS explanation of energy-credit terminations. A person who had qualifying 2025 expenditures may still have filing or carryforward questions, but that is different from a new 2026 purchase.
Even before the credit ended, ordinary roofing materials and structural components generally did not qualify just because they supported solar panels. Certain solar roofing tiles or solar shingles could qualify when they generated electricity, but traditional shingles, decking, rafters, and roof replacement costs did not become solar expenses.
Do not sign based on a future refund: Ask for the total cash price and total financed price without any federal homeowner tax credit. State, utility, tribal, or local incentives may still exist, but you must verify them through the agency or utility that actually offers them.
What happened to Solar for All
The Environmental Protection Agency terminated the $7 billion federal Solar for All program in August 2025. The EPA Office of Inspector General confirmed that status in its January 2026 audit. An ad using an old Solar for All award page is not proof that money is currently available to install solar on your home.
Some states, tribes, utilities, or nonprofits may operate separate solar programs with other funding. Confirm the current program name, funding source, open application dates, service area, income rule, homeowner contribution, ownership terms, and contractor process directly with the administering organization. See the EPA audit notice for the federal program’s status.
Compare the full deal, not only the first payment
| Option | Type of help | Who owns the system | Main risk or limit |
|---|---|---|---|
| Cash purchase | Purchase | Homeowner | Large upfront cost; homeowner handles maintenance and warranty claims. |
| Solar loan | Loan | Usually homeowner | Interest, dealer fees, payment changes, and possible security filing or lien. |
| PACE | Property-tax assessment financing | Usually homeowner owns improvements | Higher tax bill, escrow increase, tax-sale risk, and sale or refinance problems. |
| Solar lease | Equipment lease | Solar company | Long contract, payment escalator, transfer or buyout rules, and no homeowner ownership benefit. |
| Power purchase agreement | Energy purchase contract | Solar company | You pay for produced power; rate increases and transfer terms may apply. |
| Local subsidy or no-cost program | Grant, rebate, service, or subsidized installation | Varies | Limited location, income rules, waitlists, funding cycles, and approved contractors. |
| Community solar | Subscription or shared-solar arrangement | No panels on your roof | Availability, savings, cancellation, credit, and subscription terms vary. |
The CFPB found that some solar loans included dealer fees that increased the loan principal by 30% or more above the cash price. Some loans also expected a large prepayment based on an assumed tax credit and increased the monthly payment if that prepayment was not made. Those older sales structures are especially dangerous in 2026 because the homeowner federal solar credit has ended for new expenditures.
Ask for both the cash price and financed price. Review the CFPB’s solar financing report and our guide to safer repair loans.
What to check before signing anything
- Get separate prices. Ask for the cash price of the solar system, roof work, battery, electrical work, permits, financing fees, and any optional items.
- Read every agreement. The installation contract, loan, PACE assessment, lease, PPA, warranty, utility paperwork, and roof contract may be separate documents.
- Call your mortgage servicer. Ask how a PACE assessment, solar lien, UCC filing, lease, or PPA may affect escrow, refinancing, insurance, and sale.
- Check the roof independently. Get a roof inspection from a qualified person who is not paid more if you buy solar. Ask how many useful years remain and what panel removal will cost if the roof later fails.
- Verify the program. Call the city, county, state energy office, utility, tax collector, or official PACE administrator using contact information you find yourself.
- Compare at least two or three bids. Compare system size, expected production, assumptions, equipment, labor, warranties, roof penetrations, permits, and total cost.
- Check licenses and permits. Verify the contractor and salesperson where licensing is required. Call the building department about permit and inspection rules.
- Take time. Do not sign on a tablet while the salesperson waits. Ask for complete PDFs or paper copies and review them away from the sales pitch.
Questions that need written answers
- What is the cash price before financing?
- What is the amount financed, annual percentage rate, finance charge, term, and total of payments?
- Are there dealer, platform, origination, recording, administrative, closing, or prepaid interest fees?
- Will the payment change after a set period or if I do not make a large prepayment?
- For PACE, what exact amount will be added to the property-tax bill each year?
- How will the assessment affect mortgage escrow and my monthly mortgage payment?
- What lien, assessment, or UCC filing will be recorded?
- What must be paid or transferred if I sell or refinance?
- Who owns the panels, battery, renewable-energy certificates, and other incentives?
- Does a lease or PPA rate increase each year?
- Who pays to remove and reinstall panels for roof repair?
- Who is responsible for roof leaks, permits, utility approval, monitoring, and equipment failure?
- What are the cancellation rights and exact deadline?
Call script: local PACE office or tax collector
“I was offered PACE financing for solar or roof work at my home. Is this an approved program for my address? Which administrator and contractor are approved? What assessment, fees, term, lien priority, cancellation rights, and complaint process apply? Please send me the official consumer disclosures.”
Call script: mortgage servicer
“I am considering a PACE assessment or solar financing. How could it affect my escrow payment, mortgage terms, insurance requirements, ability to refinance, or ability to sell? Does my mortgage agreement restrict a senior property-tax assessment or separate solar obligation?”
Call script: solar or roofing company
“Please send the cash price, financed price, roof price, full payment schedule, APR, all fees, ownership terms, lien or filing details, cancellation form, warranties, production assumptions, permit duties, and sale or transfer rules. I will review them before I sign.”
Where real low-cost or no-cost help may exist
Real help is usually local. It may be a grant, rebate, utility service, nonprofit installation, weatherization service, deferred loan, forgivable loan, low-interest loan, or community-solar discount. None is automatically available nationwide.
Weatherization Assistance Program
The Department of Energy’s Weatherization Assistance Program is a no-cost energy-efficiency service for eligible households, administered through states and local agencies. DOE says households at or below 200% of the federal poverty guidelines, or households receiving Supplemental Security Income, are considered eligible under DOE guidelines. States may also use Low Income Home Energy Assistance Program rules of up to 60% of state median income.
Weatherization is not a general free solar or roof replacement program. A major roof failure may delay weatherization until the roof is repaired. Apply through your state or local provider using DOE’s weatherization application guide.
State, utility, tribal, and local programs
Ask your utility, state energy office, tribal housing office, city housing department, or county housing department about current solar rebates, income-qualified programs, roof repair, emergency repair, owner-occupied rehabilitation, and community solar. Verify whether the help is a grant, rebate, service, loan, deferred loan, or forgivable loan.
Application periods, income limits, funding, and allowed work can change during the year. Start with the official agency, not a social media lead form. Our guide to finding local repair programs explains how to search by address.
Community solar
Community solar may help a renter or homeowner whose roof is too old, shaded, small, or expensive to repair. You subscribe to or buy a share of an off-site solar project and may receive utility-bill credits. It does not repair your roof or place panels on your home. Review contract length, savings guarantee, enrollment fee, credit check, cancellation fee, and what happens if you move. See the Department of Energy’s community solar basics.
Independent counseling
A HUD-approved housing counselor may help you review affordability, home improvement financing, mortgage risk, or foreclosure concerns. Call 1-800-569-4287 or use HUD’s housing counseling page. Counseling does not guarantee that a particular PACE, solar, or roof contract is safe, and legal questions should go to a lawyer or legal aid.
If you already signed or think the offer was misleading
Act quickly. Do not wait for the first payment or property-tax bill. Find the date you signed, every cancellation notice, the lender or PACE administrator, and the exact legal names of the seller and contractor.
The FTC Cooling-Off Rule generally requires a three-business-day cancellation right for covered sales of more than $25 made at a buyer’s home. Exceptions apply, and state law may provide different or stronger rights. Read the FTC cancellation rule and follow the contract’s cancellation instructions exactly.
- Send a written cancellation before the deadline by every allowed method. Keep proof of delivery.
- Notify the lender, PACE administrator, lease company, or PPA company separately. Canceling only with the salesperson may not stop financing.
- Save screenshots, emails, texts, advertisements, recordings, proposals, and signed documents.
- Tell your mortgage servicer if an assessment or lien may have been recorded without your informed consent.
- Call the local tax collector, recorder, assessor, or PACE office to ask what has been filed.
- Contact a HUD counselor or local legal aid before ignoring a tax bill, loan notice, lien notice, or collection letter.
For a financing problem, submit a CFPB complaint or call 1-855-411-2372. For deceptive sales or fraud, report it through ReportFraud.gov. You can also contact your state attorney general, state financial regulator, contractor licensing board, utility regulator, and local building department.
Do not stop paying property taxes or your mortgage without advice. A contract dispute does not automatically pause tax, escrow, mortgage, lease, or loan duties. Get legal help quickly if you face a lien, tax sale, foreclosure, collection, or lawsuit.
Red flags that should stop the sale
- The salesperson says a 2026 federal homeowner tax credit will pay 30% of the project.
- The company says the federal Solar for All program is currently paying for your system.
- You cannot get a clear cash price before financing.
- The roof is called free, but its price is not shown separately.
- The salesperson promises no electric bill without reviewing fixed utility charges, usage, shading, system production, and local credit rules.
- You are told PACE is not a loan or debt because it appears on a tax bill.
- You are told every future buyer or lender must accept the PACE assessment, lease, or PPA.
- The contract appears only on a tablet, and the company will not leave a complete copy.
- The company asks for your Social Security number, deed, bank login, or tax return before clearly identifying the program and lender.
- The salesperson tells you not to call your utility, mortgage servicer, city, county, tax office, or lawyer.
- The contractor wants work to start before permits, financing disclosures, utility approval, or cancellation time is complete.
For more protection, read our guides on verifying repair programs, repair liens and recapture, and scams targeting seniors.
Documents to gather and keep
- All proposals, contracts, disclosures, cancellation forms, and financing documents
- Cash price and itemized financed price
- PACE assessment schedule or loan amortization schedule
- Roof inspection, photos, age, warranty, and separate repair estimate
- Solar layout, equipment list, production estimate, and savings assumptions
- Utility bills for at least the past 12 months
- Permit, inspection, and utility interconnection records
- Contractor and salesperson licenses where required
- Insurance certificates and warranty contacts
- Mortgage statement, escrow analysis, property-tax bill, and title documents
- Emails, texts, advertisements, call notes, and proof of cancellation delivery
A safer three-part plan
First action: Do not sign today. Ask for the cash price, full contract set, official program name, roof scope, and financing disclosures.
Next action: Verify the company and program with your utility, local government, tax office, mortgage servicer, licensing board, and at least one independent contractor.
Backup action: If the deal is unaffordable or the roof is not ready for solar, search for local repair help, weatherization, community solar, or a smaller energy project that does not place your home at risk.
Frequently Asked Questions
Is PACE financing a grant?
No. Residential PACE is financing repaid through a property-tax assessment. It can include interest and fees, raise your tax or escrow payment, affect selling or refinancing, and create tax-sale risk if payments are not made.
Are free solar panels real?
Rare income-qualified or locally funded programs may provide subsidized or no-cost solar, but there is no universal federal free-solar program. Many “free” offers are loans, leases, power purchase agreements, PACE assessments, or misleading sales pitches.
Can I claim a federal homeowner solar credit for a 2026 installation?
No. The IRS says the Residential Clean Energy Credit is not available for expenditures made after December 31, 2025. State, utility, tribal, or local incentives may still exist and must be verified separately.
Does an ordinary roof qualify as a solar tax-credit cost?
No. Traditional shingles, decking, rafters, and other components that mainly serve a roofing or structural purpose generally did not qualify. Certain electricity-generating solar shingles or tiles could qualify under the old credit rules, but the homeowner federal credit ended for expenditures after 2025.
Can PACE make it harder to sell or refinance?
Yes. A PACE assessment may have lien priority and can conflict with mortgage requirements. A buyer’s lender or a refinance lender may require the balance to be paid off before closing.
Is the federal Solar for All program still open?
No. The EPA terminated the federal Solar for All program in August 2025. Separate state, tribal, utility, local, or nonprofit solar programs may still operate with other funding.
What should I do if I signed at home?
Check the contract immediately for cancellation instructions and deadlines. Some covered in-home sales have a federal three-business-day cancellation right. Notify the seller and financing company in writing, keep proof, and contact legal aid, a HUD counselor, the CFPB, or the FTC if needed.
About This Guide
How we researched this page: We checked official federal, state, local, tribal, utility, and trusted nonprofit sources linked in this article. We reviewed program names, service areas, eligibility rules, application routes, contact details, and whether each option is a grant, loan, rebate, service, or referral.
Our role: HomeRepairGrants.org is an independent information website. We do not run these programs, accept applications, choose recipients, or guarantee funding or approval.
Local changes: Funding, waitlists, service areas, income limits, and application periods can change. Confirm current details with the organization that runs the program before you apply, sign papers, pay money, or start repair work.
Corrections: See something outdated or incorrect? Email info@homerepairgrants.org and include the page URL and a reliable source when possible.
Disclaimer: This guide provides general information. It is not legal, financial, tax, insurance, medical, disability-rights, contractor, or government-agency advice.
Last verified: July 28, 2026 | Next review: October 28, 2026