Millions of American homeowners are locked into long-term solar agreements right now. Many of them feel trapped. If you signed a solar lease or power purchase agreement years ago and now regret it, you are not powerless. You have real legal rights, and exercising them can save you thousands of dollars.
This guide covers everything you need to know about getting out of a solar contract, your consumer protections, and what steps to take today.
How Common Is It to Feel Trapped in a Solar Agreement?
Very common. The solar industry has grown rapidly, and so have consumer complaints.
The Consumer Financial Protection Bureau (CFPB) received thousands of solar-related complaints between 2018 and 2024. The Federal Trade Commission (FTC) has also issued warnings about deceptive solar sales practices. State attorneys general in California, Arizona, Florida, and Texas have each launched investigations into solar companies for misleading contracts.
If you feel stuck in a solar panel contract, you are far from alone.
Why So Many Homeowners Feel Locked In
Solar leases and PPAs typically run 20 to 25 years. Salespeople do not always explain this clearly. Common complaints from homeowners who feel trapped include:
- Monthly payments that increase 2 to 3 percent every year (escalation clauses)
- Systems that generate far less power than promised
- Contracts signed under high-pressure conditions
- Difficulty selling a home because a buyer refused to assume the lease
- Hidden fees not clearly explained at signing
Feeling stuck in a solar lease is frustrating. But frustration does not mean you are without options.
Your Legal Rights When Stuck in a Solar Contract
Understanding your rights is the first and most important step. Here is what the law actually provides.
1. The Federal Right of Rescission
If a solar salesperson came to your home and you signed a contract there, federal law protects you. Under the FTC’s Cooling-Off Rule, you have 3 business days to cancel any contract worth more than $25 signed at your home, workplace, or any location that is not the seller’s permanent place of business.
This right of rescission for solar contracts is one of the strongest protections available. You must submit your cancellation in writing. The company must refund any money paid within 10 days.
Many homeowners do not know this rule exists. If you signed recently and are having second thoughts, act immediately.
2. State-Level Cancellation Rights
Many states extend the rescission period beyond 3 days. Some go further:
| State | Extended Rescission or Protection |
| California | 3 days; strong CPUC consumer complaint process |
| Arizona | 3 days; AG office actively investigates solar fraud |
| Florida | 3 days; recent legislation targets deceptive solar sales |
| New York | 3 days; NY PSC complaint process for utility-related contracts |
| Texas | 3 days; fewer additional protections; contract language is critical |
| New Jersey | 3 days; BPU provides additional oversight |
Always check your specific state law. Some states also have Home Solicitation Sales Acts that add additional rights on top of federal law.
3. The Right to Complain and Seek Relief
You have the right to file complaints with multiple agencies. These complaints carry real weight. Solar companies often prefer to settle rather than face regulatory scrutiny.
Agencies you can contact:
- Better Business Bureau (BBB)
- Consumer Financial Protection Bureau (CFPB)
- Your state Attorney General
- Your state public utilities commission
- The FTC at ReportFraud.ftc.gov
Filing complaints creates a paper trail. It also sometimes triggers a direct response from the solar company that opens the door to negotiation.
4. Contract Breach Rights
If the solar company did not hold up its end of the agreement, you may have legal grounds to exit your solar panel contract without paying termination fees.
Common solar company breaches include:
- Failure to meet promised system performance
- Installation damage to your roof
- Misrepresentation of savings during the sales process
- Failure to obtain required permits
- Delays in installation beyond the contractually agreed timeline
Document everything. Utility bills showing lower-than-projected savings, photos of roof damage, and written records of communications with the company are all valuable evidence.
Can You Break a Solar Lease Legally?
Yes, in certain situations. Breaking a solar lease legally is possible when one or more of the following applies:
- Misrepresentation: If the salesperson made false claims about savings, system output, or incentives, this may constitute fraud. Courts have sided with homeowners in documented misrepresentation cases.
- Material breach by the company: As described above, if the company failed to perform its obligations, you may be legally released from yours.
- Mutual agreement: Negotiated exits are more common than most people realize. Companies sometimes accept lump-sum settlements significantly lower than the full remaining obligation.
- Bankruptcy of the solar provider: If your solar company has filed for bankruptcy or gone out of business, consult a bankruptcy attorney immediately. Your contract obligations may be affected.
Companies that have faced significant financial difficulty or closures include Sungevity, Verengo Solar, and several regional installers. Homeowners with these providers often found themselves in legal gray areas that required professional help to navigate.
What Happens to Your Contract When You Sell Your Home?
This is one of the biggest pain points for homeowners stuck in a solar lease. Here is how it typically works.
Most solar leases and PPAs allow the contract to be transferred to the new buyer. The buyer assumes the remaining payments and obligations. This is the cleanest exit for the seller.
However:
- Many buyers refuse to assume long-term solar contracts
- Buyers may negotiate a price reduction to offset the contract liability
- Some lenders will not approve mortgages on homes with certain types of solar financing (especially PACE loans)
- The transfer process can delay or derail a home sale
If a buyer refuses the transfer, you face a choice: buy out the solar system, pay the early termination fee, or try to negotiate a settlement with the solar company.
Getting stuck in a solar contract during a home sale is increasingly common. Addressing it early in the listing process is essential.
Solar Loan vs. Lease: How Your Rights Differ
Not all solar contracts are the same. Your rights and exit options vary significantly based on what you signed.
| Contract Type | You Own the System? | Exit Process |
| Solar Lease | No | Requires ETF, buyout, or transfer |
| Solar PPA | No | Termination value payment or transfer |
| Solar Loan | Yes (after payoff) | Pay off remaining loan balance |
| PACE Loan | Yes | Attached to property title; complex to exit |
| Cash Purchase | Yes | No exit needed; you own it outright |
If you have a solar loan, your path to freedom is simpler. Paying off the loan balance releases you from the agreement. Prepayment penalties are uncommon but should be checked in your loan documents.
If you have a solar lease or PPA, your situation is more complex. These contracts give the solar company ownership of the equipment on your roof. That ownership is the source of their leverage.
Red Flags That Signal You Were Sold Unfairly
Some homeowners who feel stuck in a solar panel contract were victims of deceptive sales practices. Signs that your contract may be challengeable include:
- You were told the panels were “free” with no clear explanation of the long-term payment obligation
- Savings projections were presented as guaranteed rather than estimated
- The salesperson rushed you to sign and discouraged you from reading the contract
- Your signature was obtained digitally through a tablet and you were not given a copy immediately
- Escalation clauses or termination fees were not verbally disclosed
- You were told that government or utility incentives would cover most costs
These tactics have been documented in FTC actions and state AG lawsuits against companies, including Pink Energy (formerly Power Home Solar), which faced a $60 million judgment in 2022, and Vivint Solar, which reached settlements over deceptive practices in multiple states.
Steps to Take Right Now If You Feel Trapped
You do not have to stay stuck. Here is a clear action plan.
Step 1: Locate and read your full contract. If you do not have a copy, request one from the solar company in writing. They are legally required to provide it.
Step 2: Identify your contract type. Is it a lease, PPA, loan, or PACE loan? This determines your options.
Step 3: Check your rescission window. When did you sign? If it was within the past few business days, act immediately.
Step 4: Document all issues. Collect utility bills, correspondence, performance reports, and photos. Look for any gap between what was promised and what was delivered.
Step 5: File complaints. Submit to the BBB, CFPB, and your state AG. Keep copies of everything.
Step 6: Consult a solar contract specialist. This is not the time for guesswork. A professional review of your agreement can identify rights and leverage you would not find on your own.
Talk to a BBB Accredited Solar Contract Expert Today
If you are stuck in a solar panel contract, professional help can make a real difference.
Solar Equity Solutions is BBB Accredited and focused exclusively on helping homeowners navigate solar contract disputes, lease exits, and termination fee negotiations. We have worked with homeowners holding contracts from major providers, including Sunrun, SunPower, Tesla Solar, Sunnova, Freedom Forever, Momentum Solar, and dozens of regional installers.
We offer:
- Full contract review and rights analysis
- Identification of misrepresentation and breach of contract claims
- Direct negotiation with solar companies on your behalf
- Complaint filing assistance with the BBB, CFPB, and state regulators
- Guidance on buyout costs, transfer options, and settlement strategies
Our process is transparent. Our fees are clear. And our track record of helping homeowners reduce or eliminate solar termination fees speaks for itself.
Contact us today for a free, confidential consultation.
Frequently Asked Questions
Can I get out of my solar panel contract if I was misled?
Potentially, yes. If the salesperson made false or misleading claims about savings, system output, or incentives, you may have grounds for fraud or misrepresentation. Document the promises made, gather your utility bills as evidence, and consult a solar contract attorney or specialist to assess your options.
What are my rights if my solar system is not producing what was promised?
Most solar agreements include production guarantees. If your system consistently underperforms the guaranteed output, the company is typically required to compensate you or remedy the issue. Persistent underperformance can also support a claim for breach of contract, which may allow you to exit the agreement.
Can I transfer my solar lease to a new buyer when I sell my house?
In most cases, yes. Solar leases and PPAs typically include transfer provisions. However, the buyer must qualify and agree to assume the contract. If they refuse, you may need to buy out the system or negotiate an early termination with the solar company.
What is the right of rescission for solar contracts?
The right of rescission is a federal consumer protection that gives you 3 business days to cancel a contract signed in your home. You must submit a written cancellation notice. The solar company must return any payments within 10 days. Some states extend this period, so check your local laws.
Is it possible to negotiate a lower solar contract termination fee?
Yes. Many solar companies will negotiate, especially when a homeowner has documented complaints, a pending BBB complaint, or legal representation. Settlements are often significantly lower than the full remaining obligation listed in the contract. Professional help greatly improves your negotiating position.