Will bankruptcy get rid of my solar panel debt?
Many people in Florida get solicited and opt to install solar panels in their home to reduce their electric bills. It’s not uncommon for the cost of the solar panels to be in the $30,000 range with relatively high interest rates.
The contracts usually last for 20 years. With interest, the solar panels end up costing closer to $40,000 once its paid in full. So, it’s not a small investment. There are a lot of customers who end up having buyers’ remorse after that purchase.
Most of the solar panel companies will file what is called a UCC (Uniform Commercial Code) statement with the secretary of state to notify other creditors that there is a secured lien on their property. It creates a lien against the collateral so if your home is sold, their lien gets paid off. It also ensures that their collateral is not sold or not used as collateral for another loan. They typically use language in their financial statement that protects the rooftop solar panels, batteries, cables, wires, support brackets, and ground mounted racking systems and secures the solar system only.
If you no longer want the solar panels, then bankruptcy will afford you some options. You can surrender the solar panels and system and see if the company will come and remove them. Another option would be to see if they send a reaffirmation agreement and try to renegotiate the terms of the loan. Alternatively a Chapter 13 case is where you can file a motion to value the panels so that you are paying back the value of the system instead of what you actually owe on it. This might also reduce your interest rate.
The only way to satisfy the UCC lien is to pay off the debt. UCC filings expire every five years.