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News & Press: Industry News

City of Los Angeles Sues Over Alleged PACE Fraud

Tuesday, April 16, 2019  
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The Los Angeles Times reported that Los Angeles city attorney Mike Feuer recently filed a lawsuit alleging that an unlicensed contractor used the PACE program to defraud low-income consumers. The lawsuit claims that the defendants led homeowners into unaffordable financing and then abandoned jobs after payment. PACE loans are collected as property taxes in programs used by private lenders but are approved by local governments to encourage energy or other safety or environmental improvements. The CLTA has been in the forefront in supporting legislation to strengthen consumer protections to prevent the types of abuses alleged by Feuer. Additionally, the Consumer Financial Protection Bureau announced it is looking at new rules to treat PACE loans more like mortgage loans.

The Times previously examined the misuse of PACE loans and consumer advocates have often criticized the program for abusive practices by home improvement contractors that sign up homeowners for the programs. The Times quoted the city attorney’s office as saying it has “other PACE related matters under review.”

California Land Title Association

1215 K Street #1816 Sacramento, CA 95814-3905
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