On this page
The answer
Checked October 21, 2026: Stopping payments does not cancel a solar loan. You still owe it, and you can expect late fees under your agreement, negative credit reporting that can stay for up to seven years,[2][3] collection activity, a possible lawsuit and, on a secured loan, action against the panels themselves.[1] Banks are expected to charge off closed-end consumer loans at 120 days past due,[4] which ends the lender's accounting, not your debt. If the installer misled you or the system does not work, the safer path is a written dispute with the loan holder while you keep paying.[12]
Our partner Solar Exit Group (Uso Holdings LLC) takes solar loans from any lender except Tesla. No cost to submit. Paid partner; it does not change our ratings.
What happens, month by month
Exact steps depend on your loan agreement and your state. This is the general pattern under federal rules, with each step sourced.
| When | What typically happens | Source |
|---|---|---|
| Day 1 past due | The payment is late. Late fees and any grace period come from your loan agreement. | Your agreement |
| First weeks | Calls, emails and letters from the lender or servicer. Autopay or interest-rate discounts tied to autopay may be lost, depending on the agreement. | Your agreement |
| 90 days | Federal banking policy tells banks to classify closed-end retail loans 90 days past due as Substandard. | [4] |
| 120 days | Banks are told to classify closed-end retail loans 120 cumulative days past due as Loss and charge them off. A charge-off is an accounting step; the debt is still owed and can be sold or sent to collections. | [4] |
| Collections | A third-party collector must send a validation notice; you have 30 days to dispute in writing. | [8] |
| Lawsuit | The holder may sue for the balance. A court judgment can lead to wage garnishment, capped by federal law. | [10] |
| Up to 7 years | Negative payment history and charged-off or collection accounts can generally be reported for seven years. | [2][3] |
What it does to your credit report
The CFPB says credit reporting companies can generally report negative payment history for up to seven years.[3] Under the Fair Credit Reporting Act, accounts placed for collection or charged to profit and loss cannot be reported once they are more than seven years old, and that seven-year clock starts 180 days after the delinquency that led to the collection or charge-off.[2] In practice, a solar loan that goes delinquent in 2026 can show on your reports into 2033 or 2034.
There is a second credit problem that homeowners often miss: mortgage lenders look for solar debt. Fannie Mae tells lenders to check the credit report for solar-related debt and the title report for related filings before they approve a loan on a home with solar panels.[14] See does a solar loan affect your mortgage refinance.
No one can legally remove accurate late payments; you can dispute errors yourself at no cost.[3] Our collections guide has a dispute letter.
Can the lender take the panels or your house?
The CFPB says some solar loans are secured, typically with a lien on the panels themselves, and others are unsecured; on a secured loan the lender has the right to repossess the panels for nonpayment.[1] Large lenders describe the lien as covering the equipment, not the house. GoodLeap says it files a UCC-1 financing statement and a county fixture filing, and that these are "not a lien against your home."[6] Solar Servicing, which took over servicing of Mosaic loans,[15] says its UCC-1 "is not a lien on the real property, only on the solar panels and related equipment."[7]
Under UCC Section 9-604, a secured party whose fixture interest has priority may remove the collateral after default, and must reimburse owners or lenders on the property, other than the borrower, for physical damage the removal causes.[5] In other words, the borrower is not owed repair costs under that section. Removal is costly for lenders, so many pursue the balance instead, but your agreement and state law decide what they can do.
A solar UCC filing is not a mortgage, so it does not by itself allow a foreclosure. The CFPB notes, though, that a UCC lien "can muddy the title" because some jurisdictions view it as applying to the whole property.[1] A court judgment for the unpaid balance is a separate risk: depending on your state, a judgment can become a lien on real estate. Ask a local attorney how your state treats judgments and homesteads.
See if our partner Solar Exit Group can help. No cost to submit. Paid partner, disclosed.
Collections, lawsuits and garnishment
- Validation. Within five days of first contacting you, a debt collector must send a written notice with the amount, the creditor and your right to dispute. If you dispute in writing within 30 days, the collector must stop collecting the disputed part until it sends verification.[8]
- Time limits. Each state sets a statute of limitations for suing on a written contract. Once it has run, a debt collector must not sue or threaten to sue on that time-barred debt.[9] The clock and what restarts it vary by state.
- Garnishment cap. If the holder wins a judgment, federal law caps wage garnishment for ordinary debts at the lesser of 25% of weekly disposable earnings or the amount above 30 times the federal minimum wage.[10] Some states protect more.
- Taxes on forgiven debt. If a lender cancels $600 or more of what you owe, it generally must file Form 1099-C,[11] and canceled debt can be taxable unless an exclusion applies. Ask a tax professional.
More detail: solar company threatening collections and solar company sent me to collections.
Safer options than missing payments
| Your situation | What to do first | Guide |
|---|---|---|
| Payment is unaffordable | Call the lender before you miss a payment and ask about hardship options. GoodLeap, for example, asks borrowers in hardship to email or call so it can "review your situation."[6] | Get out of a solar loan |
| Payment jumped at month 19 | Check whether the loan re-amortized because the 30% prepayment was not made. The CFPB says this is commonplace.[1] | Prepayment and re-amortization math |
| Installer lied or system never worked | Send a written dispute to the loan holder. The FTC Holder Rule notice lets you raise the seller's misconduct against the holder.[12] | FTC Holder Rule and solar loans |
| Installer went out of business | The loan usually continues with the lender. Find who services it. | Who services my solar loan? |
| A cheaper loan is available | Refinance and pay the solar loan off. | Solar loan refinance |
| Selling the house | Pay the loan off at closing or ask about assumption. | Selling a house with a solar loan |
| Considering bankruptcy | Talk to a bankruptcy attorney about how the loan and lien are treated. | Chapter 7 and solar loans |
You can also file a complaint with the CFPB about a lender or servicer.[13] How-to: filing a CFPB complaint against a solar company.
What to do this week
- Find your loan agreement and your lender. Not sure who holds it? Use the servicer lookup.
- Read the default section: late fee, grace period, acceleration, and whether the loan is secured by the panels.
- Look for the Holder Rule notice ("ANY HOLDER OF THIS CONSUMER CREDIT CONTRACT IS SUBJECT TO ALL CLAIMS AND DEFENSES...").[12]
- Call the lender before you miss a payment and ask, in writing afterward, what hardship options exist.
- Put any dispute in writing and keep copies. A phone complaint leaves no record.
- Pull your credit reports at annualcreditreport.com and check how the loan is reported.
- Talk to a lawyer if fraud, forgery or a broken system is involved. See solar panel lawyer.
We do not advise homeowners to stop making payments or breach contractual obligations. This page explains consequences so you can make an informed decision with an attorney. Missed payments can trigger late fees, credit damage and collection under your loan agreement; raise any dispute in writing while you keep paying.
Disclosure: We may earn compensation when you contact companies through our site. This does not change our ratings. Our partner for solar loans (all lenders except Tesla) and Sunnova PPAs is Uso Holdings LLC d/b/a Solar Exit Group; see authorized partners. SolarPanelExit.com is not a lender, law firm or credit counselor and is not affiliated with any lender named on this page.
Frequently asked questions
What happens if I stop paying my solar loan?
You still owe the loan. Expect late fees under your agreement, negative credit reporting for up to seven years, collection activity, a possible lawsuit and, on a secured loan, possible action against the panels. Banks are expected to charge off closed-end consumer loans at 120 days past due, but the debt remains.
Can a solar company take my house if I stop paying?
A solar UCC filing is not a mortgage. GoodLeap and Solar Servicing both say their filings are a lien on the solar equipment, not the home. A court judgment for the balance is a separate risk, and whether it can attach to your home depends on state law.
Can they repossess my solar panels?
On a secured loan, the CFPB says the lender has the right to repossess the panels for nonpayment. Under UCC Section 9-604 a secured party with priority may remove fixtures after default and must pay for physical damage to the property, except damage owed to the borrower.
How long does a solar loan default stay on my credit report?
Generally up to seven years. Under the Fair Credit Reporting Act, the seven years for a collection or charge-off starts 180 days after the delinquency that led to it.
If my solar company went out of business, do I still have to pay the loan?
Usually yes. The loan is with the lender, not the installer, so the installer closing does not erase it. If the installer misled you, the Holder Rule notice may let you raise that against the loan holder.
Will the lender forgive the balance?
Sometimes lenders settle for less. If $600 or more is canceled, the lender generally must file Form 1099-C, and canceled debt can be taxable unless an exclusion applies.
Still paying a solar loan (not Tesla) or a Sunnova PPA? See if our partner Solar Exit Group can help. No cost to submit. Paid partner; it does not change our ratings.
Sources
Checked October 21, 2026. Lender policies, servicer details and contact information change; confirm on the linked primary source and in your own loan agreement before you act.
- RegulatorCFPB, Issue Spotlight: Solar Financing (August 7, 2024)
- Statute15 U.S.C. 1681c, Requirements relating to information contained in consumer reports (Cornell LII)
- RegulatorCFPB, How long does negative information remain on my credit report?
- RegulatorFederal banking agencies, Uniform Retail Credit Classification and Account Management Policy, 65 FR 36903 (June 12, 2000)
- StatuteUCC Section 9-604, Procedure if security agreement covers real property or fixtures (Cornell LII)
- LenderGoodLeap, FAQ (UCC-1 and fixture filing, payoff quote, home sale, hardship)
- ServicerSolar Servicing LLC (Mosaic loans), Homeowner FAQs (loan transfers, payoff letters, UCC-1)
- Statute15 U.S.C. 1692g, Validation of debts (Cornell LII)
- Regulation12 CFR 1006.26, Collection of time-barred debts (Regulation F, Cornell LII)
- Statute15 U.S.C. 1673, Restriction on garnishment (Cornell LII)
- RegulatorIRS, Instructions for Forms 1099-A and 1099-C
- Regulation16 CFR Part 433, FTC Holder Rule: definitions (433.1) and required notice (433.2), eCFR
- RegulatorCFPB, Submit a complaint
- AgencyFannie Mae Selling Guide B2-3-04, Special Property Eligibility Considerations: Properties with Solar Panels
- CompanyForbright Bank, Solar Mosaic’s loan servicing operations transition to Solar Servicing (September 22, 2025)
Disclaimer: This page is not legal advice. It is general information, not legal, tax or financial advice, and it does not create an attorney-client relationship. Results vary by individual situation. We do not advise homeowners to stop making payments or breach contractual obligations. Consult a qualified attorney licensed in your state before acting on your solar contract or loan. We may earn compensation when you contact companies through our site. This does not change our ratings. Solar Exit Group (Uso Holdings LLC) is a paid partner; see authorized partners. See our Ownership Disclosure, Advertiser Disclosure and Methodology.