On a purchase transaction must the PACE obligation be paid off at sales closing?

Buyers may negotiate the terms and conditions of the sale of a property.  Where the subject Property is encumbered with a Property Assessed Clean Energy (PACE) obligation, the sales contract must include a clause specifying the PACE obligation will be satisfied by the seller at, or prior to, closing.  

For additional information see Handbook 4000.1, Section II.A.1.a.i.(E)(1)(a)(iii) available at: https://www.hud.gov/program_offices/administration/hudclips/handbooks/hsgh


 


All policy information contained in this knowledge base article is based upon the referenced HUD policy document. Any lending or insuring decisions should adhere to the specific information contained in that underlying policy document.


Topic Number: KA-03525