The


Mortgage
Bankers
Association
(MBA)
this
week

detailed
its
reasons
for
opposing
a
bill
in
the
state
of

Florida
designed
“to
expand
projects
eligible
for
residential
Property
Assessed
Clean
Energy
(PACE)
financing,”
which
was
recently
signed
into
law
by
Gov.
Ron
DeSantis. 

Florida
Senate
Bill

SB-770
authorizes
local
and
county
authorities
within
the
state
to
create
financing
programs
for
home
and
other
property
renovations,
which
can
include
energy
efficiency
upgrades
or
renewable
energy
installations
funded
through
non-value
based
assessments
of
a
property.

But
the
bill
as
signed
gives
first-lien
priority
to
PACE
liens
over
existing
mortgages
that
may
exist
on
the
property,
which
MBA
says
would
introduce
new
risks
for
lenders
and
consumers,
and
preclude
borrowers
from
engaging
in
refinances
with


Federal
Housing
Administration
(FHA)
or


Department
of
Veterans
Affairs
(VA)
programs,
or
from
a
loan
sold
to
the
government-sponsored
enterprises
(GSEs).

“The
now-enacted
law
will
significantly
expand
the
number
and
types
of
projects
eligible
for
financing
by
Florida’s
PACE
loan
program
without
first
subordinating
residential
PACE
liens
to
existing
mortgages
or
providing
substantive
consumer
protections,”
MBA
said.

There
is
also
a
consumer
protection
argument
to
be
made,
MBA
explained.

“MBA
has
long
opposed
residential
PACE
programs
because
they
create
risk
to
lenders
and
consumers
due
to
the
priority
status
the
PACE
lien
is
granted
ahead
of
previously
recorded
first-mortgages,”
the
association
said.
“They
also
expose
consumers
to
further
risk
because
they
are
not
yet
covered
by
MBA-supported
federal
consumer
protection
regulations
currently
being
written
by
the


Consumer
Financial
Protection
Bureau
(CFPB).”

Following
passage
in
the
Florida
state
legislature
and
submission
to
Gov.
DeSantis’
office,
MBA
sent
out
a
call-to-action
from
its
advocacy
network
to
Florida
MBA
members,
“and
coordinated
with
the
MBA
of
Florida
to
provide
a
second
wave
of
industry
opposition
and
concern,”
the
association
said.

Proponents
of
the
bill
said
it
would
act
as
a
bulwark
against
ballooning
property
tax
rates,

according
to
reporting
at

Florida
Politics.
The

Florida
PACE
Funding
Association
(FPFA)
also
praised
the
signing
of
the
bill.

“The
Florida
Legislature
and
Gov.
DeSantis
reaffirmed
their
commitment
to
the
Florida
PACE
program
passing
new
legislation
expanding
the
program
with
bipartisan
support
in
the
Senate
with
a
34-2
vote,”
FPFA
said
in
a
statement.

“The
Florida
PACE
program
will
continue
to
help
Florida
families
and
businesses
hurricane-harden
their
property
with
the
Florida
Legislature
expanding
the
program
to
now
include
financing
septic-to-sewer
connections.”

But
MBA
contends
that
“buyers
of
homes
with
PACE
liens
cannot
obtain
federally
backed
financing
unless
the
PACE
lien
is
first
paid
off
in
its
entirety,”
encumbering
the
process
of
home
purchases
and
financing
in
Florida
for
properties
engaged
in
the
PACE
program.

“MBA
will
continue
to
support
the
MBAF
in
its
efforts
to
resolve
PACE
lien
priority
issues
to
protect
consumers
and
sustain
financing
options
within
Florida,”
MBA
said
of
its
next
steps
on
the
matter.

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