Home improvements like solar panel installations, HVAC upgrades, and energy-efficient roofing can significantly reduce utility bills and increase home comfort. However, many Florida homeowners hesitate to undertake these projects due to the upfront costs. The Property Assessed Clean Energy (PACE) program provides an innovative solution, allowing homeowners to finance eligible upgrades with no money down and repay the costs over time through property taxes. In this guide, we’ll explain how to qualify for PACE financing in Florida and outline the steps to get started on your next home improvement project.
1. What is PACE Financing?
PACE financing is a government-backed program designed to help homeowners fund energy-efficient, renewable energy, and storm-resilient home improvements. Instead of requiring traditional loans or credit cards, PACE financing ties the repayment to your property tax bill, spreading the cost over a term of 10 to 25 years. This approach makes significant home upgrades more accessible to homeowners who might not qualify for conventional financing.
Key Features of PACE Financing:
- Covers 100% of the project cost with no upfront payment.
- Fixed interest rates for predictable repayment.
- Eligibility based on property equity, not credit score.
- Transferable loan tied to the property, not the homeowner.
PACE is especially popular in Florida, where energy-efficient and storm-resilient upgrades are vital for managing high energy demands and preparing for severe weather.
2. Who is Eligible for PACE Financing?
PACE financing has specific eligibility requirements that focus on your property rather than your personal financial history. Here are the main criteria to qualify:
- Property Type
PACE financing is available for various property types, including:
- Residential single-family homes
- Multi-family properties (up to four units)
- Certain commercial properties
If you own a home in Florida, your property is likely eligible as long as it meets other program requirements.
- Property Equity
To qualify, you must have sufficient equity in your property. Typically, PACE programs require:
- A minimum loan-to-value (LTV) ratio, which ensures you own a certain percentage of your home’s value. For example, if your home is worth $250,000 and your mortgage balance is $150,000, you have $100,000 in equity, or a 40% LTV ratio.
The exact equity requirement may vary by program, but homeowners with significant equity are more likely to qualify.
- Mortgage and Tax Payment History
PACE financing ensures that applicants are financially responsible by requiring:
- No recent mortgage delinquencies (usually none within the last 12 months).
- No outstanding property tax payments.
Staying current on these obligations improves your chances of approval.
- Property Location
PACE financing is available in participating areas. Florida has several municipalities and counties that have adopted PACE programs, so you’ll need to verify that your property is located within a participating region.
3. Steps to Qualify for PACE Financing
If you meet the basic eligibility criteria, here’s how to get started with PACE financing:
Step 1: Research Participating Providers
In Florida, multiple PACE providers administer financing programs. These providers may specialize in different types of projects, such as energy efficiency or storm resilience. Popular PACE providers in Florida include:
- Ygrene
- Renew Financial
- Florida PACE Funding Agency
Research providers in your area and compare their terms to find the one that best suits your needs.
Step 2: Confirm Eligibility Requirements
Each PACE provider may have slightly different requirements. Work with your chosen provider to confirm:
- Minimum equity thresholds
- Loan-to-value ratio limits
- Any additional documentation needed for approval
Your provider will also verify that the proposed home improvement project qualifies under the program.
Step 3: Choose an Eligible Project
PACE financing covers a wide range of home improvements, including:
- Solar panel installations
- High-efficiency HVAC systems
- Reflective roofing
- Hurricane-resistant windows and doors
- Insulation and ventilation upgrades
- Backup power systems, such as battery storage or generators
Select a project that aligns with your energy efficiency or storm-resilience goals. Many PACE providers maintain a list of pre-approved contractors to ensure high-quality work.
Step 4: Work with a PACE-Approved Contractor
Once you’ve identified an eligible project, hire a contractor who is certified by your PACE provider. Approved contractors are familiar with program requirements and can help streamline the approval process. They will:
- Provide an estimate for the project.
- Submit necessary documentation to the PACE provider for financing approval.
Step 5: Get Approval
The approval process typically involves:
- Verifying your property’s equity and tax payment history.
- Reviewing the contractor’s estimate and project scope.
- Confirming your repayment terms, including the loan amount, interest rate, and repayment schedule.
Most approvals are granted within days, allowing you to move forward with your project quickly.
Step 6: Complete the Project
After approval, your contractor will complete the installation or upgrade. The cost of the project is covered directly by the PACE provider, so you won’t need to worry about paying the contractor out of pocket.
Step 7: Repay Through Property Taxes
Your PACE financing will be added to your property tax bill as a separate line item. Repayment terms are typically spread over 10 to 25 years, and many homeowners find that the energy savings from their upgrades offset the additional tax payment.
4. Benefits of PACE Financing
PACE financing offers unique advantages that make it an appealing choice for Florida homeowners:
- No Upfront Costs: Start your home improvement project immediately without dipping into savings.
- Energy Savings Offset Costs: Projects like solar panels or efficient HVAC systems often result in lower utility bills, helping to offset financing repayments.
- No Credit Check Needed: Approval is based on property equity rather than credit history.
- Transferable Loan: If you sell your home, the remaining balance transfers to the new owner, making it easier to invest in long-term improvements.
5. Example: A Florida Homeowner’s Journey with PACE
Scenario: A Tampa homeowner wants to install solar panels and upgrade to a high-efficiency HVAC system but lacks the upfront funds. They qualify for PACE financing by meeting the following criteria:
- 40% property equity
- No mortgage delinquencies in the past year
- Current on property taxes
Results:
- Total project cost: $25,000
- Monthly utility savings: $150
- Annual energy savings: $1,800
- Property tax repayment: $1,500/year for 20 years
The homeowner immediately benefits from lower energy bills, improved comfort, and increased property value while repaying the cost over time.
Conclusion
PACE financing is an innovative and accessible way for Florida homeowners to fund energy-efficient and storm-resilient home improvements without upfront costs. By meeting the program’s property-focused criteria, you can upgrade your home, lower utility bills, and enhance your property’s value. If you’re ready to take the next step, research local PACE providers and consult with a certified contractor to begin your journey toward a more efficient and comfortable home.
Want to Learn More?
The PACE program offers an excellent opportunity for Florida homeowners to finance essential energy-efficient upgrades without upfront costs. By partnering with Guardian Home, you can enhance your home’s comfort, safety, and value while contributing to a more sustainable future. Contact us today to schedule your free consultation and start your journey towards an energy-efficient home. Contact us today!
