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Appraisal Institute Joins 10 Associations Opposing Changes to PACE Loans

August 17, 2016 09:10 AM

CHICAGO (Aug. 17, 2016) – Citing “a host of serious consumer protection concerns,” the nation’s largest professional association of real estate appraisers joined 10 trade associations Tuesday to oppose recent changes to the federal government’s Property Assessed Clean Energy loans, known as PACE loans.

The Appraisal Institute and the other groups expressed concern over recent actions taken by the Department of Housing and Urban Development on behalf of the Federal Housing Administration, as well as by the Department of Veterans Affairs. PACE loans allow local governments to provide financing for energy efficiency, renewable energy and water efficiency projects that building owners pay back through property tax assessments, according to the National Conference of State Legislatures website.

“Our associations support responsible efforts to provide homeowners with affordable and accessible financing for energy efficient home improvements, and sounder alternatives to the FHA’s and VA’s new PACE guidelines already exist,” the groups wrote in a letter to Housing and Urban Development Secretary Julian Castro and Veterans Affairs Secretary Robert A. McDonald.

“We urge you to suspend the applicability of the proposed FHA and VA PACE guidelines and issue the proposal for notice and comment so that lenders, borrowers, home improvement providers, and others may be given the opportunity to comment and assist the Departments in establishing policies that better protect consumers, lenders, and taxpayers.”

The Appraisal Institute joined with associations representing the vast majority of mortgage lenders of all sizes and charter types and real estate professionals in the United States:

·         American Bankers Association,

·         American Land Title Association,

·         Credit Union National Association,

·         Housing Policy Council of the Financial Services Roundtable,

·         Independent Community Bankers of America,

·         Mortgage Bankers Association,

·         National Association of Federal Credit Unions,

·         National Association of Realtors,

·         Real Estate Services Providers Council and

·         The Realty Alliance.

The associations said the July 19 guidance issued by HUD for FHA, and by VA, “undermines the lender’s (and the government’s) collateral position and disrupts the very nature of secured lending.”

The groups also noted that PACE loans “are not typically accompanied by federal Consumer Financial Protection Bureau disclosures and protections associated with home mortgages, including the new Know Before You Owe disclosures, right of rescission protections, or the Ability to Repay standards.”

Read the letter here:



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The Appraisal Institute is a global professional association of real estate appraisers, with nearly 20,000 professionals in almost 60 countries throughout the world. Its mission is to advance professionalism and ethics, global standards, methodologies, and practices through the professional development of property economics worldwide. Organized in 1932, the Appraisal Institute advocates equal opportunity and nondiscrimination in the appraisal profession and conducts its activities in accordance with applicable federal, state and local laws. Individuals of the Appraisal Institute benefit from an array of professional education and advocacy programs, and may hold the prestigious MAI, SRPA, SRA, AI-GRS and AI-RRS designations. Learn more at




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