The upfront cost to buy and install solar panels is too high, so leasing them seems a viable option. However, the problem arises when you often face difficulty in understanding the company policies. If you are planning to sign a lease but are unsure if you can cancel the solar panel contract after installation, let’s find out!
Can You Cancel Solar Panel Contract After Installation?
Yes, you can.
The impact of canceling your solar contract greatly varies depending on the specific terms and conditions outlined in your solar panel lease agreement. Before initiating contact with the company, it is crucial to thoroughly review and comprehend all termination clauses.
Usually, third-party providers allow you to cancel your contract within a limited period without facing any penalty charges. Leasing companies have different cancellation periods, but it’s usually around 30 days after signing the contract. Consider seeking legal counsel to guide you in negotiations with the solar provider.
Can You Cancel the Contract Before On-Site Roofing Evaluation?
Most leasing contracts specify other unforeseen events under which cancellations are allowed. Suppose you signed the contract before on-site roofing evaluation for solar panel installation. In such a case, yes you can terminate the contract due to unforeseen additional expenses.
How to Break a Solar Lease
To break a solar contract, determine the buyout price offered by the company and pay the remaining amount you owe for owning the system. Typically, the buyout is available after the lease has been active for 5 to 7 years. The company offers a buyout contract solar panel lease option for your solar panel lease. This allows you to purchase your system at a fair market price whenever you want to end the solar contract. Before deciding to buy, it is recommended to consider how long you have used the system and to carefully read the documents.
Cross-Reference: Common Terms and Conditions of a Solar Panel Lease Agreement
Besides buying out, you have other options such as transferring the agreement by selling your house. When you break a solar lease and move out, you can either buy or persuade the new owner to take over the lease.
Process of Cancelling the Solar Panel Contract
Overall, for an easy implementation of the process, you can follow these steps.
- First, identify and have a valid reason for your solar panel contract termination request.
- Then, once your reason is considered valid by the provider, they may ask for a cancellation fee to pay.
- In the end, ensure that the termination contract is signed by both parties and properly documented.
It’s essential to carefully review the details of your agreement and be fully aware of your cancellation rights before committing to any solar contract, whether it’s a lease or another arrangement. By doing so, you can potentially save yourself substantial amounts of money and avoid numerous potential issues. Always make sure to thoroughly understand the terms before finalizing the contract.
What Happens if I Stop Paying My Solar Lease?
A solar lease can cost around $50 to $250 for a month. This estimated price can fluctuate based on your location, energy use, system size, credit score, and other related factors. Several reasons might lead you to stop making payments on your solar lease, such as financial challenges, poor performance of the solar system, or relocating to a new home. However, it’s important to be aware that failing to pay your solar lease can result in certain consequences. Some common consequences that happen if you stop paying solar lease are as follows:
1. Breach of Contract
One party doesn’t follow the agreed terms, like being late on a payment or not delivering something promised. This situation is termed a breach of contract. As per the legal contract, both parties have to be responsible and careful about fulfilling their terms. Just as the solar company is liable to supply good quality equipment and ensure proper maintenance, similarly, you are liable to pay for your solar lease, otherwise it will be a breach of contract.
2. Legal Consequences
When you stop paying your monthly lease, there is a possibility that the company may take legal action against you. The company has the right to sue you in court if it wants to recover the loss it incurred because of you. They might also ask for court costs and attorney fees if they win the case.
Also Read: 4 Leasing Solar Panels Pros and Cons
3. Reputation Damage
Not paying your solar lease or canceling your solar contract can damage your reputation which will portray you as an unreliable customer. Due to this, finding another solar provider might be difficult for you.
4. Low Credit Score
In case you do not pay your monthly solar lease, the concerned company can report your case of late or delinquent payments to credit rating agencies which can negatively affect your credit score.
5. Cancellation Fees and Penalties
In case of termination when you stop paying your solar lease and want to cancel it, then it will cost you a penalty. Almost every solar company charges a termination fee as mentioned in the termination clause. So, you will be liable to pay these fees to the solar company as a penalty for canceling your contract after installation.
Read how to get out of a solar panel contract in a detailed version.
So, we finally understand that you can cancel your solar panel contract after installation due to financial issues or contract breaches. However, it is important to read and understand the agreement before entering into one to avoid the complications of ending it early.