Lenders have specific requirements about Solar panels. If your solar panels do not comply then you will experience delays on re-sale or remortgage. Solar panel providers do not always supply you with all the documentation you need and this means issues later on. Leased solar panels cause the most issues. Those owned outright are less troublesome but not immune.
Will the Solar panels be owned outright, or leased? What is the position regarding the Feed in Tariff? Do you have Building Regulations? Is the roof capable of taking the weight? Was a roof survey obtained? Not all installers are reliable or aware of the issues. Make sure you have everything in order before you find a buyer.
BEWARE: A Solar panel Lease is the one lenders dislike. Your buyer may be mortgaging.
If you are missing Documentation, at best you will experience delays, but at worst your buyer cannot proceed as your property will not meet lenders terms and conditions. Don’t get caught out.
To check your mortgage lender requirements, see paragraph 5.20 of the Lenders Handbook. You can find the handbook on this link:
I have also set out the paragraph below:
5.20 Energy Technologies Installed on Residential Properties
5.20.1 Where a property is subject to a registered lease of roof space for solar PV panels we require you to check that the lease meets the UK Finance minimum requirements. Where you consider it does not, check part 2 to see whether you must report this to us and for details of any additional requirements.
5.20.2 If, after completion, the borrower informs you of an intention to enter into a lease of roof space relating to energy technologies, you should advise the borrower that they, or the energy technology provider on their behalf, will need to seek consent from us.
5.20.3 UK Finance has issued a set of minimum requirements where a provider/homeowner is seeking lender consent for a lease of roof space for solar PV panels. See part 2 for our additional requirements relating to these leases.
5.20.4 Check part 2 to see whether we require you to disclose the details of any existing Green Deal Plan(s) on a property
Below are examples of the enquiries raised by Conveyancers on properties with solar panels:
Please provide the Lease (if applicable), Schedule of Installed Equipment, Electrical Schematic, Data Sheets for PV Modules, inverter and system performance, Test and Commissioning Documentation, Operations and Maintenance Guide and Building Regulations Compliance Certificate under Part P Electrical Wiring.
2. Please provide existing lender’s written consent to the installation of the panels.
3. Please evidence who owns the Feed in Tariff (FiT). Or who the Tariff is assigned to? Please liaise with Ofgem, or the Assignor, and provide us with a copy of the assignment agreement. Please provide us with the details of the Buy Out Sum should our client wish to remove the Panels.
4. Please confirm the seller will agree an allowance to cover the Buy Out cost. You will appreciate that the buyer does not wish to take on the cost for Solar Panels installed by the seller.
5. Please confirm if the seller has repaid the installation cost of the Solar Panels and please include a copy of the last two Electricity Bills so we may see any Green Deal Payments for the Panels.
6. Please supply the contract and agreement in respect of the output of the Panels and confirm that on completion the seller will authorise payments to be made to the buyer and assign the system to the buyer. Please provide us with a deed of assignment.
7. Please confirm that the system has the building regulations consents that are required, and in respect of planning, that it complies with the General Permitted Development Order for Solar Panels. We will also require a copy of the survey that should have been put in place prior to the Panels being installed. The survey should confirm the roof timbers can support the Panels’ weight.
8. Please confirm that the Solar Panels do not project more than 200mm from the roof surface, or above the highest part of the roof (excluding the chimney).
9. Please supply any service contract. Please advise if there have been any breaches of the terms of the agreement. Please confirm that the payments received are at the level quoted in the agreement or supporting documents.
10. Please confirm that the Panels are not in breach of any title covenants and do not interfere with any rights of light or air.
11. Please confirm who insures the Panels?
12. Please confirm that there are no trees that could block light to the Panels, and which are covered by a Tree Preservation Order
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