CPACE Financing Structure and Repayment Terms 2

Question 1

Which party is primarily responsible for repaying a PACE assessment when a commercial property is sold?

Accepted Answer

The new property buyer

Answer

PACE assessments are tied to the property, so when a property is sold the assessment obligation transfers to the new buyer.

Question 2

How does a PACE financing lien typically rank in priority compared to a first mortgage?

Accepted Answer

It holds senior priority over the first mortgage

Answer

PACE assessments are structured as property tax liens, which in most states hold super-priority status above first mortgages.

Question 3

What is the maximum financing term typically allowed under most commercial PACE programs?

Accepted Answer

30 years

Answer

Commercial PACE programs commonly allow repayment terms of up to 30 years, matching the useful life of long-lived improvements.

Question 4

A PACE assessment is collected through which existing government mechanism?

Accepted Answer

Property tax bill

Answer

PACE repayments are added to and collected alongside regular property tax assessments by the local taxing authority.

Question 5

Which document formally establishes the PACE assessment obligation on a commercial property?

Accepted Answer

Assessment contract or financing agreement recorded in the county

Answer

A recorded assessment contract placed in the county land records creates the lien and legally binds the property to PACE repayment.

(CPACE) Commercial Property Assessed Clean Energy Practice Test