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Law Educator, Esq.
Law Educator, Esq., Lawyer
Category: Consumer Protection Law
Satisfied Customers: 118087
Experience:  Attorney experienced in commercial litigation.
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A non profit organization (NPO) offers to low income families

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A non profit organization (NPO) offers to low income families to install photovoltaic solar systems to cover about 75% of their electric bills. Most of NPO's installations are free or very low cost to the homeowner. Our neighbor recently had one of their systems installed completely free of charge. I spoke with the contractor to find out what I'd need to do to see if we qualified for their program. He gave me a phone number and they said that I qualified on every count but one was in question, Did I have a deed restriction? You also must have a deed restriction in your mortgage agreement to qualify for the program. Your neighbor is a Habitat for Humanity client, she cannot sell her home for the next 25 years. We require a deed restriction for at least 5 years. I asked the contractor, How many of your clients are also Habitat for Humanity clients? He said, So far All of them! (Humm)
The program is CA. State funded from tax dollars. Only one NPO distributes the funds, and makes the decision: Who qualifies and gets the benefits from the program. I don't know if they have an appeal process if they decide an applicant does not qualify, or who would regulate this program.
I did submit an application for the program with a copy of my deed restriction I found in my HAMP mortgage agreement. It says: "I agree as follows: All or part of the property or any interest in it shall not be sold or transferred without Lender's prior written consent."
Wouldn't that qualify as a 'deed restriction'?
NPO said they would consider and rule on my application and let me know what their decision is in a few days.
I expect to be turned down.

I appreciate what the organization is doing, but I am also interested in protecting the rights of ALL low income families and their right to be fairly considered for such State programs.
Are consumer laws in place to prevent organizations to distribute State funds specifically to 'our' special group? Any information would be appreciated, thank you.

This is the program:
This is the NPO:
Thank you for your question. I look forward to working with you to provide you the information you are seeking.

I am afraid that the mortgage agreement statement you typed above is not a deed restriction, it is a lender notification clause, because it does not restrict or prevent you from selling the property for any period of time.

I am sorry to say that in this and many other programs the reason for the deed restriction is to stop people from upgrading their property and then turning around an selling it immediately to realize a profit. There have been many unscrupulous contractors who have used and abused low income families by getting a low income family into a home on the deed and using these federal programs and then paying the low income couple several thousand dollars more to buy the house back from them and the developer will resell the house for tens of thousands more with the free upgrades installed.

Thus, the laws do not prevent these groups from having such requirements in their programs for deed restriction requirements to participate in these programs.

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Customer: replied 4 years ago.

I do understand everything you said and I agree that nobody should take advantage of these programs.Yet, putting fraud aside. Why not offer, that we can provide a solar system to you because you qualify, you'll just have to agree to not selling your home in the next 5 years or so? Or make the low cost payments for the next few years.

We live in one of the hardest hit areas for the nations economy. Almost everyone in my neighborhood would qualify for the program. My neighbor lost his home despite being a hard worker a few years ago. Habitat for Humanity bought that house and made it the nicest house on the block inside and out. Our new neighbors moved in a few months ago. She drives a late model Mercedes Benz and now She has the solar system as well. She works a part time job at the Habitat for Humanity Store. It seems a little out of balance to me.


Thank you for your response.

I am afraid you are asking questions that are philosophical questions, but not legal questions. Legally, they can impose such requirements without violating any laws or committing any type of illegal discrimination. You are commenting on issues that many people complain about regarding the "entitlement system" in the US and about people who take advantage of the system and receive entitlement benefits that they should not receive or that they have manipulated the system to receive.

You are calling for what many Americans are calling for, revamping the system, which is a Congressional duty I am afraid. As far as the way this program and many others are set up right now, it is within the laws and your battle or argument is with how Congress has set up those laws and rights to entitlements.
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