Can Solar Panels Be Repossessed? [Answered]

Switching to solar energy is an exciting decision that can save you money while being kinder to the environment. But before you dive in, it’s wise to understand the potential risks involved, including the possibility of your solar panels being repossessed. Yes, you read that right – those gleaming panels on your roof could be taken away under certain circumstances.

While the idea might seem alarming, the good news is that repossession is avoidable if you play your cards right. In this article, I’ll break down the situations where repossession can occur and, more importantly, provide you with practical tips to steer clear of this unpleasant scenario.

Can Solar Panels Be Repossessed

When can Solar Panels be Repossessed? 

The possibility of repossession typically arises when you’ve opted for financing or leasing options to obtain your solar panel system. Let’s examine the specifics:

Loan or Financing Agreement

If you’ve taken out a loan or entered into a financing agreement to purchase your solar panels, the lender essentially has a lien on the panels. This lien acts as collateral, granting the lender the legal right to repossess the panels if you fail to make your loan payments as agreed.

Think of it like a car loan – if you stop making your car payments, the lender can repossess your vehicle. The same principle applies to solar panels when you’ve financed their purchase.


In some cases, homeowners choose to lease their solar panel system rather than purchase it outright. Under a lease agreement, the leasing company retains ownership of the panels, and you’re essentially renting them.

If you breach the terms of the lease, such as by missing payments, the leasing company may exercise their right to repossess the panels since they still belong to them.

Power Purchase Agreement (PPA)

A Power Purchase Agreement (PPA) is another popular option for going solar. With a PPA, a third-party company installs solar panels on your property and sells you the electricity they generate at a predetermined rate.

While you don’t own the panels, you agree to purchase the power they produce. If you violate the terms of the PPA, such as by failing to make payments, the company that owns the panels may have the right to remove them from your property.

What Should be Done If You are Facing Solar Repossession? 

If you find yourself in a situation where repossession is looming, don’t panic – there are steps you can take to potentially resolve the issue.

Act Immediately

The moment you receive a delinquency notice or any indication that repossession is a possibility, it’s crucial to act swiftly. Ignoring the problem will only make it worse, so reach out to your lender, leasing company, or PPA provider right away.

Explain your circumstances and express your willingness to find a solution. Lenders and providers are often more open to working with proactive customers who communicate their difficulties upfront.


Once you’ve opened the lines of communication, it’s time to negotiate. Explore your options with the lender or provider, such as:

  • Requesting a lower payment plan or extended loan terms to make the payments more manageable.
  • Inquiring about hardship programs or financial assistance options, if available.
  • Considering refinancing your loan with a different lender at a lower interest rate, if possible.

The key is to be transparent about your financial situation and demonstrate a genuine desire to find a mutually agreeable solution.

Restructure Your Finances

While you’re negotiating with your lender or provider, take a hard look at your personal finances. Review your budget, cut unnecessary expenses, and explore any government or non-profit aid programs that could help alleviate the burden of utility bills or fund energy efficiency upgrades.

Every little bit of financial breathing room can make a difference in avoiding repossession and getting back on track with your solar panel payments.


What happens if my solar panels are repossessed?

If your solar panels are ultimately repossessed, you’ll lose the panels themselves, along with any equity you’ve built in them. Depending on the specific terms of your agreement, you may still be responsible for paying off the remaining balance on the loan or lease.

Can I sell my solar panels to avoid repossession?

In some cases, you may be able to sell your solar panels to a third party and use the proceeds to pay off your loan or lease agreement, thereby avoiding repossession. However, you’ll need to check with your lender or provider for their specific policies and requirements regarding such a sale.

What are the consequences of solar panel repossession?

Beyond losing your solar panels and potentially still owing money, repossession can also have a negative impact on your credit score. This can make it more difficult to obtain financing for other purchases or investments in the future.


While the prospect of having your solar panels repossessed might seem daunting, it’s important to remember that it’s an avoidable situation. By understanding the circumstances that can lead to repossession and taking proactive steps to communicate with your lender or provider, you can often find a workable solution.

If you find yourself facing financial difficulties, don’t let pride or fear prevent you from reaching out for help. Lenders and providers are often willing to work with customers who are upfront about their challenges and committed to finding a resolution.

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