Solar Sales Red Flags, Built From the Enforcement Record

The pitch was built to get your signature that day

A salesperson at the door or at your kitchen table. A tablet. A monthly payment lower than your power bill, and a tax credit that supposedly covers a big piece of it. If that sounds familiar, you were not unlucky. You got the standard pitch, and regulators have spent two years writing down how it works.

Most red flag lists in this category say “high pressure” and “too good to be true” and leave it there. This one is built from the paperwork. Every flag below points at something a specific agency found or alleged about solar sellers and the lenders behind them. Where a case is pending, these are allegations, and they are labeled that way. They are still a far better map of what this industry does to homeowners than any generic warning.

The starting gun was August 7, 2024, when Treasury, the CFPB and the FTC announced consumer advisories and an interagency partnership with the Department of Energy and HUD. Treasury said it was responding to an increase in consumer complaints about companies that pressure consumers into predatory contracts, including with unfair financing, or fail to install or activate systems as promised.

The four tactics the CFPB named

1. A fee you never see, inside the number you borrow

The CFPB found that some lenders include markups that increase the loan principal by 30 percent or more above the cash price, and that they frequently bake these dealer fees into the principal without indicating that the fee is a markup over the cash price.

What it sounds like: nothing. That is the design. If nobody has told you the cash price of your system, you cannot see this one at all.

The record: Minnesota sued GoodLeap, Sunlight Financial, Solar Mosaic and Dividend Solar Finance in March 2024 over roughly $35 million in hidden fees on nearly 5,000 loans, most of them raising borrowers’ costs by 15 to 30 percent. The arithmetic is on our dealer fee page.

2. A tax credit promised to someone whose taxes nobody asked about

The CFPB found sales pitches promoting the 30 percent federal credit with a presumption of universality, and marketing that subtracts a presumed credit to present a “net system cost,” with the actual loan principal shown in small gray type and the net cost in large bright type.

What it sounds like: “your net cost is really only.” Also anything about a check the government mails you.

The record: an older homeowner told the CFPB they were promised a $10,000 reimbursement at tax time that never came, and could not get a copy of their own contract. Treasury lists promises of tax credits to people who owe no taxes as a scam indicator outright.

The 2026 update: the IRS says the Residential Clean Energy Credit is not available for any property placed in service after December 31, 2025. Anyone still pricing a new installation off a 30 percent credit in 2026 is selling you a credit you will not receive.

3. A payment that jumps in month 19

The CFPB found it commonplace for solar-specific loans to re-amortize to a higher monthly payment at the 19th month unless the borrower makes a substantial prepayment first, frequently 30 percent of the principal.

What it sounds like: a monthly payment that seems impossibly low, presented without the sentence that should follow it.

The record: one borrower told the CFPB their payment would rise from $180 to $250 for 38 years if they did not send a $9,000 check, and that they had not understood this while e-signing. Another wrote that after years of on-time autopay their payment increased because the balance had not fallen below a threshold they were never told about.

4. Savings sold as a guarantee

The CFPB found consumers were told panels would cover the cost of the financing and eliminate future energy bills, while the actual benefit varies with location, season, system design, component quality, installation failures, weather, rate design and tree growth. It also noted that some loan agreements state the borrower’s obligation does not depend on the system’s performance at all.

Put those two findings side by side. The salesperson promises savings. The loan you sign says you pay whether or not the savings show up.

What it sounds like: any number about your future utility bill presented without an assumption behind it. Treasury tells buyers to ask whether estimates are based on their own past usage and current rates, or on something else.

The model a state attorney general put a name to

On July 15, 2026, Michigan’s attorney general sued Climax Solar, its owner, and the financial institutions that financed consumers’ purchases, alleging a deceptive solar-financing scheme affecting approximately 1,700 Michigan consumers and an estimated $81 million in financed transactions, in the U.S. District Court for the Western District of Michigan.

The complaint calls the model “pitch, sign, fund, fail, and collect,” and each word is a flag.

Pitch. Sales representatives allegedly promised homeowners they could replace or greatly reduce their utility bills with affordable solar payments, use federal tax credits to lower the cost, and have a working system installed quickly.

Sign. Many consumers were allegedly rushed through electronic contracts and financing documents during a single in-home visit. Treasury’s advice is the countermeasure: be careful signing anything on the seller’s computer or tablet, and make sure you receive every document in a form you can keep.

Fund. Climax allegedly submitted transactions through lender-controlled portals, and the financing companies released substantial funds based on paperwork and interim project milestones before systems were completed, connected to the grid, or approved by the utility to operate. The money moved before the system worked, and everything that went wrong afterward follows from that.

Fail. Many consumers were allegedly left with systems that were unfinished, underperforming, unsafe, or never turned on, along with property damage, missing permits, failed inspections and unfulfilled rebates, while still owing both the utility bill and the loan.

Collect. The financing companies allegedly continued to service, collect, report, assign or enforce the loans after consumers reported disputed signatures, failed inspections, missing permits and unsafe conditions, with some consumers facing negative credit reporting, liens and collection activity tied to projects that were incomplete or defective. After Climax filed for bankruptcy and ceased operations in 2024, some financing companies allegedly closed consumer complaints or directed homeowners to keep working with a company that no longer existed.

The suit also alleges more than $22 million in hidden financing costs included in system prices without being separately disclosed as finance charges, with dealer fees, platform fees and similar charges averaging more than 27 percent of the amount financed.

The flags keep coming after the sale

The pitch is only where it starts. Connecticut’s attorney general reached a $100,000 settlement with Spruce Power 3, LLC in March 2026, resolving an investigation into billing, customer service and warranty issues that peaked between 2021 and 2023 after the company acquired solar contracts from NRG Energy.

The same announcement disclosed a civil investigative demand to SunStrong seeking records on quality control monitoring and consumer complaints, after roughly 65 complaints to the attorney general and the Department of Consumer Protection that included failure to uphold warranties, unresponsiveness, and a $10 monthly fee to receive data on the system’s own production.

So add a flag for the years after signing: a servicer that charges you to see what your own panels produced.

Who they pitch hardest

The industry does not pitch everyone equally, and the CFPB has the numbers.

Between 2021 and 2023, consumers 18 and older received 8.4 million pieces of mail advertising that included solar financing promotions. About 34 percent of those, roughly 2.8 million, went to adults 60 and older, and 62 percent of the mail aimed at older adults came bundled with ads for windows, roofing, kitchen remodeling and similar work. The CFPB’s analysis of Census data also found that between 2020 and 2021, 44 percent of older homeowners with solar panels relied on financing or other non-cash methods, compared with 36 percent of homeowners aged 18 to 59.

The CFPB also noted reports of salespeople pitching consumers with limited English proficiency in their preferred language while providing the purchase contract only in English. Treasury lists that mismatch as a scam indicator.

If you recognize your own deal

You are not stuck with the version of events the salesperson gave you, and you have more options than the lender will volunteer. Free steps first, in this order.

Check the clock. If you signed recently or the project has not reached permitting, the cancellation window is the cheapest exit that exists, and it closes fast.

Get the two numbers. Cash price and loan principal. The gap is the fee, and it is the single most useful fact in any complaint you write.

File the complaints. Your state attorney general, then the CFPB and the FTC, which is where Treasury’s own advisory sends you. Every case on this page started as complaint volume.

Put the service failure in writing. Dates, what the contract promised, what happened. Send it to whoever is servicing the account today, and keep a copy.

Only after all four does it make sense to spend money on the problem, and even then the money should usually go to an attorney with a real claim, never to a company advertising cancellations. Nothing on this list requires handing anyone a percentage of your loan balance.

This is general information, not legal advice. Pending cases are allegations, and what any of this means for your own contract depends on documents and state law we cannot see, so take the paperwork to an attorney licensed in your state before you decide what you have.