Solar Advisory and Questionnaire
Solar Advisory and Questionnaire – Questions & Explanations
- What is the purpose of the Solar Advisory and Questionnaire?
It informs buyers and sellers about the existence, ownership, financing, and maintenance of solar energy systems on a property. It helps clarify whether the system is owned, leased, financed, or subject to a power purchase agreement (PPA). - Does the seller have to disclose if the solar system is leased?
Yes. A leased system creates a contractual obligation that the buyer may need to assume. Full disclosure ensures the buyer understands ongoing payments, terms, and responsibilities. - What is the difference between an owned solar system and a leased one?
An owned system is fully paid off and transfers as part of the property. A leased system or PPA means the seller doesn’t own the panels outright, and the buyer may need to qualify with the solar company to assume the contract. - Does the buyer have to qualify to assume a solar lease or PPA?
Yes. Solar companies often require buyers to meet credit and financial qualifications before assuming the lease. If the buyer doesn’t qualify, the seller may need to pay off the lease or negotiate another solution. - Can a solar system affect the buyer’s ability to get financing?
Yes. Lenders may factor in lease payments or PPA obligations when calculating the buyer’s debt-to-income ratio, potentially impacting loan approval. - What documents should the seller provide regarding the solar system?
Sellers should provide the purchase contract, lease agreement, PPA, warranty information, maintenance records, and details of any liens or financing arrangements. - Does a solar system increase property value?
It depends. Owned systems often add value, while leased systems may be viewed as liabilities by some buyers due to the ongoing payment obligation. - Can there be liens attached to a property because of solar financing?
Yes. Some financing arrangements, like PACE (Property Assessed Clean Energy) loans, may place a lien on the property that must be disclosed and potentially paid off at closing. - Who is responsible for maintaining the solar system?
For owned systems, the homeowner is typically responsible. For leased systems, the leasing company usually handles maintenance. This should be clarified in disclosures. - Are warranties on the solar system transferable to the buyer?
Yes, in many cases. Warranties on equipment, performance, or maintenance may transfer, but the buyer should confirm terms directly with the solar provider. - Does the utility company have to approve the transfer of solar service?
Sometimes, yes. Buyers may need to set up new accounts or agreements with the utility to ensure net metering or energy credits transfer correctly. - What happens if the solar lease has a buyout option?
The buyer or seller may choose to pay off the remaining lease balance at closing, converting the system into an owned asset. This can simplify the transaction. - Can disputes arise over solar disclosures?
Yes. If a seller fails to disclose a lease, financing, or PPA, buyers may face unexpected financial obligations and could pursue legal remedies for nondisclosure. - Should solar systems be inspected during escrow?
Yes. Just like roofs or HVAC, buyers should consider hiring a solar specialist to evaluate system condition, functionality, and compliance with permits. - Does the advisory protect the broker and agents?
Yes. By providing the Solar Advisory and Questionnaire, the broker ensures the buyer is informed, documents the disclosure, and reduces liability if disputes arise.
✅ The Solar Advisory and Questionnaire is critical because solar agreements can be complex, financially binding, and sometimes misunderstood. It protects both buyers and brokers by ensuring clarity and full disclosure.
Disclaimer:
The questions and answers provided are for general guidance only and may not cover all details or apply to every situation. If anything is unclear or you need further clarification, please visit car.org for official resources and the most up-to-date information from the California Association of REALTORS®.
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