Florida PACE Loan: How It Works, The Lien Risk & What Buyers Must Know

By Emanuel Greco, Licensed FL Real Estate Professional · Updated July 2026

A PACE loan (Property Assessed Clean Energy) lets Florida homeowners finance energy-efficient improvements — solar panels, impact windows, roofing, HVAC — without a traditional mortgage. The loan is repaid through your property tax bill over 5 to 30 years. That structure sounds convenient. It also creates a super-priority lien on your property that can block a sale, spook lenders, and surprise buyers who never knew the assessment existed.

How Florida PACE Financing Works

1. Homeowner applies through a PACE provider (Mosaic, Ygrene, Renew Financial, etc.)
2. PACE provider pays the contractor directly for the eligible improvement
3. The county records a non-ad valorem assessment on the property — this is a lien, not a mortgage
4. The homeowner repays the assessment through their annual property tax bill, in two installments (November and April in most FL counties)
5. The assessment stays on the property even if it sells — unless paid off at closing

Eligible Improvements Under Florida PACE

Florida's PACE programs (authorized under F.S. §163.08) cover:

• Solar photovoltaic panels and solar water heaters
• Impact-resistant windows and doors (a major FL use case — huge demand post-Ian and Idalia)
• Roofing upgrades (metal roofs, hurricane-rated shingles)
• HVAC systems (high-efficiency central air, ductless mini-splits)
• Insulation and air sealing
• Battery storage systems paired with solar

The Lien Priority Problem

This is where PACE gets complicated for real estate transactions. In Florida, property tax liens — including PACE assessments — have super-priority status. They rank ahead of most mortgages and other liens in foreclosure. This means:

• Fannie Mae, Freddie Mac, FHA, and VA will not fund a mortgage on a property with an outstanding PACE lien unless it is paid off at or before closing
• Many conventional lenders follow the same rule — they don't want their first lien position subordinated to a PACE assessment
• Cash buyers can purchase a property with a PACE lien and assume it — but only if they knowingly agree to

The practical result: most Florida sales involving PACE financing require the seller to pay off the remaining PACE balance at closing before a financed buyer can close. This shows up as a deduction from the seller's proceeds on the Closing Disclosure.

How to Find a PACE Assessment on a Property

• Ask the seller directly — Florida's seller disclosure form has a section on assessments; PACE must be disclosed
• Pull the property tax bill — look for any line item under "Non-Ad Valorem Assessments" on the Hillsborough, Broward, Miami-Dade, Palm Beach, or other county tax statement
• Check the county property appraiser — most FL counties show non-ad valorem assessments on the parcel detail page
• Title search — a thorough title search should catch a recorded PACE assessment lien in the county's official records

Florida PACE Reforms — What Changed

Florida significantly reformed PACE financing with legislation effective July 2023. Key changes under the reform:

• PACE providers must verify the homeowner's ability to repay (income verification)
• Disclosures must be provided in the borrower's primary language if not English
• A 3-day right of rescission was added (borrowers can cancel within 3 business days)
• PACE providers must verify the homeowner's equity — the assessment cannot exceed 20% of the home's value
• Contractors cannot submit applications on behalf of homeowners without homeowner consent

These reforms addressed widespread predatory lending complaints — particularly contractors in disaster-affected areas using PACE to lock homeowners into high-rate financing without full understanding of the terms.

PACE vs. Traditional Home Improvement Financing

Should You Buy a Home with an Existing PACE Lien?

If the seller is paying off the PACE balance at closing (most financed sales), the impact on you is minimal — confirm it on the Closing Disclosure under seller deductions. If you're a cash buyer considering assuming a PACE lien:

• Verify the remaining balance and annual payment amount
• Confirm the improvement (solar, windows, etc.) is in good working order
• Negotiate a purchase price reduction reflecting the outstanding balance
• Understand that refinancing later will require paying off the PACE lien first if you want a conventional loan