Home improvement loans tied to property taxes now have consumer protections

The US consumer protection agency now requires lenders for certain home improvement loans to check if homeowners can actually pay them back. These loans, which are tied to property taxes, were previously exempt from these consumer protection rules.

For years, lenders could offer Property Assessed Clean Energy (PACE) loans without verifying if homeowners could afford them. This led to many homeowners facing foreclosure because of unaffordable debt. Now, these lenders must assess a homeowner's ability to repay, and homeowners can sue if they are given loans they cannot afford.