The term HERO stands for Home Energy Renovation Opportunity and is a government based program providing financing for energy efficient, water efficient, and renewable energy products to homes and businesses in approved communities within California and Missouri. Basically, it is a home loan that you can get to install energy efficient materials in your home. That all sounds great but there are downsides.
Also known as the PACE program (property assessed clean energy financing), the HERO loan only sounds good in theory. There’ve been so many drawbacks to it and disadvantages, that homeowners are now finding themselves stuck with a loan they may not be able to get rid of. The idea of getting home improvements done now and paying for them later does seem appealing, but the interest rates, fees, and set up can be horrendous and it could hike up your tax base, adding hundreds to your mortgage each month.
Read More: Was the HERO Loan ever a Good Idea?
Plus, what a lot of homeowners don’t realize is that it takes the first precedence over any other liens against the house. This means if you plan on selling your house, lenders will not lend on properties where they don’t have the first position. This also makes a second mortgage almost impossible. If you have second mortgages first, they cannot close without the HERO loan being paid off. So, while it might sound good on the front-end, the reality is it takes priority, and you may be stuck with it… Until now.
There are ways to get out of the HERO loan. Not all mortgage advisers and officers can handle this type of situation but I, on the other hand, specialize in this. Although this type of loan is transferable as far as the title, most lenders will still not loan on a property they don’t have the first position in. So the HERO loan would have to be paid off prior to the close of escrow. This creates a difficulty in refinancing and selling.
Typically the only way to get rid of this type of loan is through the selling of the property or a refinance, but like we said before, it needs to be paid off first. With creative financing in the way that I set up my loans for my clients, we can transfer a lot of the money owed into a new loan. There are ways out of it without having to come up with a huge chunk of money.
The most important thing is to call a lender or mortgage adviser that is fully aware of the program and has experience in helping homeowners out of the program through the refinancing or selling. Let’s get you out of this burden that adds hundreds to your property tax each year. Give me a call today.
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I have a hero loan and want to take out a home equity loan to pay it off and consolidate some other debt. Is that even possible?
would like to pay off hero loan
want to pay off hero pace loan do not want another loan were do i go to do this
I want to obtain a Reverse Mortgage,can I do that with a hero loan Since the title remains in my name?
Want to pay off the hero loan but what are my options
We have 250,000 equity in our house. We were scammed in a business deal that took all our savings and struggling to keep our home. We have been turned down on bill Consolidation. Not person will help us with a loan because of the Hero loan. We need help? Any suggestions? I would appreciate it if someone can help us. What do you suggest?
If you are behind on the mortgage then it will be very difficult to help. If your mortgage is on time and you have equity, we can absolutely save you money and get rid of the Hero. If you are behind on your mortgage, your best options would be a loan modification with your current lender and/or Keep Your Home California program to help you catch up on late payments.
I want to pay off my Hero loan right now!
It is possible and very do-able to sell your home with a hero loan. If your realtor or mortgage advisor tells you that you cannot, then they are inexperienced and need to do more homework. I just sold my home with a hero with no issues at all. It’s all about your realtor.
I purchased a home and the only thing I knew about the sellers HERO loan / lien was that is was going to be paid for (I even have paperwork to that effect)
All was going well until 18 months later when my current mortgage company saw the Hero lien on the property un-paid so they paid it out of my escrow account
Now I’m somehow on the hook for this loan / lien that I never agree to pay and certainly did not sign any agreement to pay. Mystery of mysteries is the Title co just so had an exclusion for this (and in their paperwork it’s not even the correct amount)
At this point is seems that everyone keeps saying that the HERO loan / lien follows the house
But I don’t see how I can be stuck with this loan with out my expressed consent
Curious about adding hero loan into my main mortgage. Questions?
I’m interested in trying to get rid of my hero loan
We need help!!! My mother (who is a senior citizen) got talked into having a new roof put on her house by 2 guys going door to door. She had a roof leak in one room of her house, and didn’t need a whole new roof. This was a huge scam. They took advantage of her and now she is locked into this debt that is wiping away every cent she has. She is unable to save for emergencies, etc. She is worried she will lose her home,because the payments are tied in with her property taxes and I am so afraid the stress will eventually kill her. The house is not that big and yet, when this is paid, she will have paid $43,000.00 for a new roof. Can anyone tell me that is normal?
How can I pay my hero?
Our Hero loan is in my mother in laws name and she passed away in August 2020. The house is now owned by her son. Can we still refinance and how?
Please reach out about your Hero Loan situation – I think I can help!
As long as you have been making the payments (have proof) we should be OK to do the refinance.
I want to pay off my hero loan. I tried calling them, and they are not taking calls??
I didn’t get full disclosure when they offered to hep me with my AC . Nobody told me anything about lien on my house, except that when I sell the house it will pass to the new owner since it’s attached to the property tax. I wanted to get rid of it now. My first payment is next month. Thank you
My husband and I got scam by A. M. Solar up here in Paso Robles California. We got Hero program but the solar company will not fix the problems. We been without power for two or three years. I tried calling the them and either they don’t have time or don’t answer my calls. And I have warranty on all equipments. I give them an F and Hero. Not happy
Hi Jackie, I simply want to pay off whatever remaining balance I have. How do I do that? It’s very hard to find a simple set of payoff instructions.