Published: August 2023

Proposed rule would protect future PACE borrowers

The comments submitted by advocates urge the CFPB to quickly finalize its proposed rule on Property Assessed Clean Energy (PACE) financing and to protect consumers by monitoring and developing guidance for other emerging green lending products.

Consumer action joined a coalition of advocates, led by Americans for Financial Reform Education Fund, in comments to the Consumer Financial Protection Bureau (CFPB) regarding the agency’s proposed rule on residential Property Assessed Clean Energy (PACE) financing—used by homeowners to pay for energy efficient upgrades. The organizations asked the CFPB to finalize the rule swiftly to protect consumers. They also urged the agency to take measures when assessing other emerging green lending products to minimize the types of public harm and negative consequences that resulted from the problematic design of and predatory practices associated with PACE financing. Residential PACE loan products have often been pushed onto consumers through predatory and fraudulent sales practices, binding consumers to unsustainable loans that they cannot repay. Paired with the problematic structure of PACE loans, which involves superpriority liens being placed on consumers’ homes, the program has resulted in many consumers, particularly those from underserved communities, losing their homes through foreclosure. This proposed rule on PACE financing is an opportunity to prevent future harms to consumers. 

Lead Organization

Americans for Financial Reform Education Fund

More Information

Read the letter here.

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