On December 17, 2024, the Consumer Financial Protection Bureau (CFPB) finalized a rule applying standard mortgage protections to Residential Property Assessed Clean Energy (PACE) loans. The rule amends Regulation Z to clarify that voluntary tax assessments and liens, like PACE financing, are not excluded under the Truth in Lending Act (TILA) and recognizes PACE financing as meeting the definition of “credit” under TILA and Regulation Z. It also introduces ability-to-repay requirements for residential PACE loans. The rule is set to take effect on March 1, 2026.

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