A settlement has been reached regarding the so-called PACE program, which gave out loans for people to make energy improvements in their homes, but critics say many homeowners became victims of predatory contractors and their homes wound up in jeopardy of being foreclosed.
“I can’t sleep, I lost my sleep in this seven years,” Zenia Ocana, a PACE borrower, said.
Ocana thought she was getting money saving solar panels installed in her home seven years ago, but she says it turned into a scam.
Now she’s celebrating a $12 million dollar settlement her lawyers got from LA County and lenders with the PACE program, which extends loans to homeowners like Ocana — to make improvements in water and energy efficiencies in their homes— but the lawyers say too often turned into predatory lending.
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“Home improvement contractors went around selling these PACE loans door to door, so the contractors themselves were selling their own services, home improvement work, but they were also selling this financing,” said Stephanie Carroll with the Public Counsel.
LA County ended its program in 2020 after five years, after criticism that vulnerable residents like Ocana were being targeted.
PACE allows borrowers to pay back loans through their property taxes, but some say they were deceived by unscrupulous contractors and wound up with liens on their homes they couldn’t afford.
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“Often people believed the representations they were being told that this was a free government program and signed up for this work thinking that the work was going to be free and many months later getting a property tax bill that was huge,” Caroll said.
Despite the backlash, the county says PACE was largely successful, with thousands of home projects completed, both saving energy and reducing pollution.
PACE loans continued to be offered through the state where officials say reforms are in place to protect homeowners.
On its website, one of the lenders in the settlement, Renew Financial, states that “PACE financing has some of the most robust consumer protections in the country.”
The attorneys say Ocana will share in the settlement with thousands of other victims.
