Solar panels are not one financial product. Two homes can have nearly identical rooftop systems and create very different real-estate transactions depending on who owns the equipment and whether debt or a long-term energy contract is attached to it.
Start by identifying the structure. The panels may be owned outright, financed with a separate solar loan, leased from a third party or operated under a power purchase agreement, often called a PPA. Colorado's 2026 Seller's Property Disclosure specifically asks whether solar panels are present and whether they are owned or leased.
Owned-and-paid-off systems are usually the simplest from a transaction standpoint. Separately financed systems require a review of the loan, payoff or assumption terms and any recorded security interest. The CFPB notes that when a homeowner sells before a solar loan is paid off, common outcomes are payoff at or before sale or buyer assumption when the lender permits it.
Leases and PPAs create a different issue because the homeowner may not own the equipment. The buyer and lender need the actual agreement. Fannie Mae's current guidance requires lenders to review lease or PPA terms for financed purchases and treats third-party-owned solar differently from borrower-owned panels for underwriting and appraisal purposes.
Do not judge solar only by the current electric bill. Review the age and output of the system, warranty, roof condition, transfer requirements, monthly payment or energy rate, escalation clauses, remaining term, lien or UCC filings, insurance obligations and what happens when the agreement ends. A low current payment can still be unattractive if the transfer terms are poor.
For sellers, gathering the solar contract early can prevent a closing delay. For buyers, the system should be evaluated as part of the property economics rather than as a free bonus. Sources: Colorado 2026 Seller's Property Disclosure; Fannie Mae Selling Guide, properties with solar panels; Consumer Financial Protection Bureau solar financing guidance.
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