July 20, 2010
Fannie Mae and Freddie Mac issued letters stating that Property Assessed Clean Energy, or PACE, programs may violate the mortgage lenders’ rules because counties receive a priority position when it comes to repayment. The PACE programs are a result of Assembly Bill 811, enacted in 2008. It allows borrowers to pay back loans used to install solar power systems through property taxes. Fannie and Freddie argued that a default on a property in the PACE program would entitle counties to be paid back before the lender.