Real Estate Transactions & Solar Agreement Transfer FAQs

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SELLING A HOME WITH SOLAR

 

What options do I have in regard to the solar system agreement when I sell my home?

If the system is owned by Tesla:
The most common option is to transfer the agreement to the new homeowner. After transfer is completed, the new owner would simply pick up where you left off. If you would like to explore other options outside of transfer, please refer to the terms in your agreement.


If the system is owned by you:
If you have purchased your panels with cash or have secured funding with a third-party lender, you do not need to transfer the contract. The warranties remain with the solar system and automatically transfer. Once your home is sold, reach out to the Property & Title Team so we can update your account.

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What is the process for transferring the agreement to the person purchasing my home?

If the system is owned by Tesla:

  1. Notify Tesla prior to listing. As soon as you are ready to put your solar home on the market, notify the Property & Title Team. So long as we are provided with permission to share your solar agreement details, we are happy to serve as a resource throughout the home sale process and ensure applicable parties have the information they need regarding the solar system/agreement.
  2. Ensure your intentions are clear. If you intend for the buyer of the property to assume the solar system/agreement, ensure that it is clearly disclosed to your real estate agent (or representative) and any potential buyers. You may decide to list the assumption of the solar agreement as a contingency which can help to ensure a smooth process.
  3. Notify us once you enter in contract. Once there is a buyer, communicate that they should notify the Property & Title Team as soon as possible so we may answer any questions they have and start the transfer process. Alternatively, we can reach out to them if we are provided their contact information.
  4. We'll handle the paperwork. Tesla will provide a simple transfer agreement for both buyer and seller to sign. It’s all done online, so there’s no need to worry about filling out lots of forms. Just e-sign and you’re done.
  5. It’s official. Once we are notified that the purchase of the property has been completed, we will update the account into the assuming party’s name.


If the system is owned by you:
There is no paperwork involved as the warranties remain with the solar system and automatically transfer. Either the buyer or seller may notify the Property & Title Team and provide the newly recorded deed and we will update the account owner.

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Is there a qualification process for the buyer to assume the solar agreement?

There is no qualification if Tesla does not own the system or if the agreement was fully prepaid. If there is a monthly obligation to Tesla, the buyer may qualify in one of three ways:

  1. Meeting Tesla’s credit criteria
  2. Purchasing the home with cash
  3. If they do not qualify under (1) or (2), paying a $250 credit fee

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Is there anything I need to consider in regard to the solar system prior to accepting an offer on my home?

If the system is owned by Tesla:
If you intend for the buyer of the property to assume the solar agreement, ensure that it is clearly disclosed to your real estate agent (or representative) and any potential buyers. You may decide to list the assumption of the solar agreement as a contingency which can help to ensure a smooth process. Consider inquiring about the lender your potential buyer has chosen (for example, VA loans) and whether they will mortgage a property with an existing solar agreement.


If the system is owned by you:
If you have purchased your panels with cash or have secured funding with a third-party lender, you do not need to transfer the contract. The warranties remain with the solar system and automatically transfer. Once your home is sold, reach out to the Property & Title Team and provide the newly recorded deed and we will update the account owner.

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What is Tesla's success rate for transferring agreements through home sales?

When Tesla customers sell their homes, we transfer the solar agreement to the new owner ~98% of the time. In a small number of cases our customers elect other options as outlined in their agreement.

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Can the value of the panels be included in the price of the home?

If the homeowner is the owner of the solar system it may be included in the appraised value of the property. If the homeowner does not own the solar system it should not typically be included in the value of the property.

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BUYING A HOME WITH SOLAR

 

How does the solar system work with the local utility company?

The solar system works in tandem with the local utility company through a process called Net Energy Metering (NEM). During the day, you will use all the electricity the system produces as your primary source. If you require more electricity than what the system can provide, you will pull that from the local utility at their regular rates. If on the flip side, you use less electricity than what the system produces, the excess will flow to the utility as a credit that can be used at a later date. Every utility handles these credits a little differently, so we always recommend reaching out to them directly if you have questions about their specific NEM policy. You can learn more about Net Energy Metering.

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Is transferring the solar agreement into my name difficult?

No. Transferring a solar agreement into your name is a simple process. Our Property & Title Team is happy to answer your questions about the solar system on the home and the transfer paperwork can be sent digitally to sign.

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Does the term start over if I assume an existing solar agreement?

No. You simply pick up where the original customer left off within the agreement.

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Who should I contact regarding questions when I purchase a home with a Tesla solar system?

Contact the Property & Title Team. Tesla is the leading company in the industry with a team focused exclusively on handling agreement transfers. Our team is staffed with experts from the real estate industry who are familiar with the entire home sale process, from listing through escrow, and have handled thousands of transfers. Once we have received permission from the initial contract holder, we will share the details of the solar agreement and answer any questions you may have.

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Is there a qualification process to assume the solar agreement?

There is no qualification if Tesla does not own the system or was previously fully prepaid. If there is a monthly obligation to Tesla, the buyer may qualify in one of three ways:

  1. Meeting Tesla’s credit criteria
  2. Purchasing the home with cash
  3. If you do not qualify under (1) or (2), paying a $250 credit fee

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My lender is requesting information about the solar system for the home I’m purchasing, what should I do?

If your lender is requesting documentation regarding the solar system, please notify the Property & Title Team so they can direct your inquiry to our Lender Relations team. Common requests include, but are not limited to:

  • A copy of the solar agreement
  • Termination of the UCC-1 Financing Statement on title

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BUYING A NEWLY CONSTRUCTED HOME FROM A BUILDER WITH SOLAR

 

I just moved into my new home, are my solar panels working?

The next step is to get approval from your local utility to activate your Tesla energy products. Please email us to get this started.

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When can I turn on my solar system?

Once the utility has granted permission for your system to operate, Tesla Customer Care will contact you to help turn your system on. If you receive an email, door hanger, or tag on your electric meter regarding your solar system, please contact Tesla Customer Care. Once you have received permission to operate, you can download the Tesla mobile app to monitor your system in real-time, anywhere.

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Why does it take so long to activate my solar panels?

Tesla or your utility will send electronic documents for you to sign, which will need immediate signatures. Every utility has a slightly nuanced process for granting permission to operate.

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What impact do solar panels have on my electricity bill?

Installing solar panels on your roof allows you to generate your own electricity and pay less to your utility. Your electricity costs after solar will depend on how much electricity your solar panels generate, how much electricity you use, and how much your utility charges for electricity. Visit Tesla Energy support to learn more.

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LENDER AND TITLE INQUIRIES

 

Why does Tesla file a UCC-1 on title?

Tesla files a UCC-1 financing statement to protect our interest in our personal property, the solar system. Anyone who might perform a title search on the address where the system is located will see the UCC-1 which indicates that Tesla’s personal property is installed on the home. This filing protects our rights as the system’s owner; however, does not make claim against the real property. If the lender that holds the mortgage on the real property forecloses on our customer’s home, the UCC-1 filing protects our interest in the solar energy system and prohibits the lender from taking ownership of it.

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What agreement types does Tesla file a UCC-1 Financing Statement on?

Leases, PPAs and our MyPower loan contracts have existing UCC-1 Financing Statements on title. Once the MyPower loan is paid off, the UCC-1 is removed. Solar systems purchased outright do not have a UCC-1 on title from Tesla.


Solar Loans through third-party financing companies may have a UCC-1 Financing Statement on title. You will need to work directly with that lender to address the UCC-1.

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Is a UCC-1 Financing Statement a lien?

No. What you’ll find on the title of a home with a Tesla solar system is a UCC-1 Financing Statement (sometimes referred to as a fixture filing). A UCC-1 financing statement is not a lien against the home.

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If a UCC-1 is not a lien, can it be removed or subordinated?

Yes. We are aware that lenders prefer to be in first position on the title of the home or not to see anything on the title entirely so it’s common practice for us to either temporarily release or subordinate the UCC-1 for financing purposes. Whether we temporarily release or subordinate is determined by the type of solar contract. There may be a document processing fee associated if you require the UCC-1 to be released or subordinated for a financial transaction. Please note that the account does need to be in good standing prior to us fulfilling a release or subordination request.

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My lender is requesting information about the solar system for my refinance, what should I do?

If your lender is requesting documentation regarding the solar system, please notify the Property & Title Team so they can direct your inquiry to our Lender Relations team. Common requests include, but are not limited to:

  • A copy of the solar agreement
  • Termination of the UCC-1 Financing Statement on title

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I’m looking at the contract, but how do I know what type it is?

Lease: The customer pays for the use of the system and the services that come with it at a fixed monthly payment, which may increase slightly each year. Tesla owns and maintains the system.
Power Purchase Agreement: Also referred to as PPA, the customer pays for the power produced by the system at a certain kWh rate, which may increase slightly each year. Tesla owns and maintains the system.
MyPower Loan: The customer financed the purchase of a PV system through a loan from Tesla and pays fluctuating payments over a set term. The customer owns the system. Payments are calculated based on the system production, but they are applied toward the purchase of the system.
Purchase: A cash contract is a full outright purchase of a solar system. The customer owns the system. Sometimes this may be financed by a third-party lender.

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