Exposing Predatory Lending and Solar Panel Fraud in California
How Fraudulent Solar Companies and Lenders Are Putting California Homeowners at Risk
Over the past year, predatory lending tied to fraudulent solar panel companies has emerged as a growing crisis across California. Homeowners from Los Angeles to the Central Valley are reporting being trapped in massive, long-term loans they didn’t fully understand—loans that resemble mortgages but offer none of the stability. In many cases, the solar systems underperform or cause property damage, all while locking residents into financial obligations they never knowingly agreed to.
While solar panel providers often serve as the face of the transaction, they are frequently backed by financial institutions that participate in deceptive lending practices. These hidden partnerships have left many homeowners vulnerable, especially when borrowers discover they have been sued without notice or saddled with default judgments they never had the chance to contest.
What Is Predatory Lending in the Context of Solar Installations?
Predatory lending refers to unethical and often illegal loan practices that mislead borrowers about the true cost, risks, or terms of a loan. In California, this often occurs when homeowners are misled into signing solar panel installation contracts that simultaneously bind them to large, long-term loans. These loans often have ballooning interest rates, misrepresented benefits, and hidden fees, and they are frequently tied to property tax bills through programs like PACE (Property Assessed Clean Energy).
Legal Protections Available to California Homeowners
Thankfully, both state and federal laws provide protections to homeowners who have been defrauded or deceived by solar panel companies and lenders. These include but are not limited to:
- California Business and Professions Code Section 17200 – Prohibits unlawful, unfair, or fraudulent business acts.
- Civil Code Section 1632 – Requires translated contracts in certain circumstances.
- Homeownership and Equity Protection Act (HOEPA) – Federal protection against high-cost mortgage loans.
- Truth in Lending Act (TILA) – Requires clear disclosure of credit terms.
- Federal Trade Commission Act – Bans unfair or deceptive trade practices.
- California Financial Code Division 1.6 – Regulates consumer lending in the state.
Recent Settlement Underscores the Severity of the Problem
In March 2024, Los Angeles County reached a $12 million settlement with solar panel customers who alleged that certain financial institutions were participating in predatory lending practices through the PACE program. Homeowners alleged, among other things, that they were misled into taking out loans for solar installations with high-pressure sales tactics and deceptive marketing.
Despite this settlement, predatory solar financing remains a pressing issue across the state. Many Californians are still facing unexpected lawsuits and losing their homes due to default judgments, without ever receiving adequate notice or legal representation.
What You Can Do: Contact the Law Offices of Ali Taheripour
If you suspect that you or a loved one has been victimized by a fraudulent solar company or a predatory lender, you can contact The Law Offices of Ali Taheripour and share the specific facts of your case. We are here to help protect California homeowners from injustice.
Contact us today to schedule a consultation and learn more about your rights.