© Provided by NBC MiamiHome improvement financing programs are popular, but some homeowners say the program has drawbacks.
PACE loans are being introduced to fund “no down payment” and energy-efficient home improvement projects like solar panels, new roofs and glare-free windows.
This is the program Millie Edwards signed up for to improve her home in Fort Lauderdale.
Edwards has lived in the house since 1979, but in 2019 he decided to make necessary repairs.
"He said it would take three to four weeks. I said you can get the permit in three to four weeks and he said I will send the permit today,” contractor Edwards told us.
He says the seller told him about a financing plan for a new roof. He was told that work would begin within a week.
When we interviewed Millie this August, her roof wasn't done, but she had a new bill.
"I'm desperate. But I can't because I don't know where I'm going and I don't want to lose any money," Edwards said.
PACE loans are a type of financing that you repay with an additional assessment that is collected along with your property taxes.
In Edward's case, his tax bill increased from $1,658 to $13,128 in 2018 after adding the PACE credit.
PACE loans are seen as security for your property, and critics say homeowners should weigh the pros and cons before signing.
"In some cases, it's homelessness. A person can no longer afford to keep their home," said consumer fraud attorney Robert W. Murphy.
Murphy said some homeowners remain in the dark about the true cost of the program.
"It's very stressful because next year when they get their first tax bill, they're going to find that their taxes have gone up a lot," Murphy said.
Murphy said some homeowners feel a false sense of security because they believe the PACE loan program is run by the county or local electric company.
Miami-Dade and Broward counties list licensed PACE providers on their websites. PACE contracts are between owners and private companies, not the county.
Steps will be taken to protect consumers before and after the project is complete, according to the PACE Florida Financial Agency, the government agency that funds PACE.
These guarantees include a recorded call stating financial backing for the project and another stating that the property owner will not pay the contractor if they are not satisfied with the work done. In addition, all contractors associated with PACE are licensed and insured.
However, Murphy says there are still instances where contractors are paid before the work is completed or approved by regulators.
Murphy said it's also important to read the actual text of the contract. Many contracts contain arbitration clauses that prohibit simple rescission of the contract or legal action against the companies involved in the project.
