Rocket companies, parent Rocket mortgage, is following the solar energy industry closely, announcing this week that it will enter the green energy game by 2022.
The Detroit-based company said it will use the same technology, data and customer experiences used in mortgages, real estate and personal lending “to help Americans make their homes more energy efficient.”
The plan is for a “dedicated team of team members with extensive industry experience” to help clients determine if solar panels are the best choice for their home, Raket said.
Once the decision is made that the client is eligible, the team will help connect homeowners to a “simple digital finance application” and help “ease the installation of a new solar solution”.
As a prelude to the Rocket Mortgage initiative, it announced a new rate and maturity refinancing product that will allow borrowers to “combine any solar panel with their mortgage for one low interest rate.”
The program provides more flexible rules than traditional cash-based refinancing and has a loan-to-value (LTV) ratio of up to 97%, Rocket said.
Refinancing will be available to any homeowner with a solar energy loan, including property-assessed clean energy (PACE) loans and private loans. Homeowners who refinance will continue to be eligible for federal tax credits for installing solar panels. Borrowers will not be required to use tax credit proceeds to pay off panel debt.
Joel Gurman, executive vice president of Rocket Mortgage and leader of the initiative, told HousingWire that the decision to develop renewable energy came after a significant number of clients responded positively to the initiative.
“We have a sizable portfolio of clients, roughly 2.5 million clients, and we did some research on this group and we had a lot of people raising their hands in favor of this product,” Gourmet said.
Rocket Companies CEO Jay Farner said in a statement that the company has “the technology and expertise to provide the best possible experience for homeowners looking to be green.”
“This is a perfect synergy between our businesses as we develop a digital solution so Americans can get solar panels with the confidence they’ve come to expect with our Rocket platforms,” Farner said.
In a press release, Rocket noted that entry into the clean energy home industry offers great business opportunities and that the industry continues to show signs of growth, with more than 2 million solar panels installed in the US to date and growing in number.
Solar panel installations are picking up steam: The solar market set a record 19.2 gigawatts (GWDC) of solar capacity in 2020, according to a joint study published earlier this year by the Solar Industry Association and Wood Mackenzie.
The study also found that solar energy accounts for 43% of all new generating capacity added in the country last year and predicts that the solar market will quadruple by 2030.
The testing phase of this project will begin in the fourth quarter of 2020 and is expected to be available to the public in early 2022, Rocket reports.
In recent years, industry trade groups and regulators have sounded the alarm about how structure of PACE loans mean that mortgages take precedence over home mortgages. PACE programs are also not regulated as heavily as other financial services, including mortgages.
In 2019, the Consumer Financial Protection Bureau announced plans to release new program rules.
In May Bloomberg published an essay about how subprime solar loans are trapping low-income homeowners in Florida, California, and Missouri.