this Mortgage Bankers Association The MBA this week detailed its reasons for opposing a Florida bill to “expand projects eligible for Residential Property Assessed Clean Energy (PACE) financing,” a bill recently approved by Gov. Ron DeSantis. Ron DeSantis) signed into law.
Florida Senate Bill SB-770 authorizes local and county authorities in the state to develop financing programs for home and other property renovations, which can include energy efficiency upgrades or renewable energy installations funded through a non-value assessment of the property.
But the signed bill gives PACE liens priority over existing mortgages that may exist on the property, which MBA said would create new risks for lenders and consumers and prevent borrowers from participating in refinances. federal housing administration (Federal Housing Administration) or Department of Veterans Affairs (VA) program, or from loans sold to government-sponsored enterprises (GSEs).
“The law now enacted will significantly expand the number and types of projects eligible for financing under Florida’s PACE loan program without first placing a residential PACE lien under an existing mortgage or providing substantial consumer protections,” MBA said. .
Consumer protection arguments also need to be made, the MBA explained.
“MBA has long opposed the residential PACE program because PACE liens take precedence over previously recorded first mortgages and therefore create risks for lenders and consumers,” the association said. “They also expose consumers to further risks. , because they are not yet protected by MBA-backed federal consumer protection regulations currently governed by Consumer Financial Protection Bureau (CFPB).
After it passed the Florida Legislature and was submitted to Governor DeSantis’ office, MBA issued a call to action to MBA Florida members from its advocacy network “and coordinated with MBA Florida to raise a second wave of industry opposition.” Worrying,” the association said.
Supporters of the bill reportedly said it would serve as a bulwark against ballooning property taxes. Florida Politics. this Florida PACE Grant Association (FPFA) also praised the bill’s signing.
“The Florida Legislature and Governor DeSantis reaffirmed their commitment to Florida’s PACE program by passing, with bipartisan support in the Senate, a 34-2 vote to expand the program,” FPFA said in a statement. New legislation.
“The Florida PACE program will continue to help Florida homes and businesses withstand hurricanes and fortify their properties as the Florida Legislature expanded the program to now include financing for septic tank to sewer connections.”
But the MBA believes that “homebuyers with PACE liens cannot obtain federally backed financing unless the PACE lien is first paid off in full,” hampering the Florida home buying and financing process for properties participating in the PACE program.
“MBA will continue to support MBAF’s efforts to resolve the PACE lien priority issue to protect consumers and maintain financing options within the state of Florida,” MBA said of next steps on the issue.
