This content is for informational purposes only and does not constitute legal advice or create an attorney-client relationship.
Seeing ads promising a solar panel contract cancellation? Learn why guarantees are a red flag and what to check before paying any company an upfront fee.
Beware of Solar Panel Cancellation Guarantees: What You Need to Know
If your solar panels aren’t producing what you were promised, or your payments are higher than you expected, a social media ad that offers a fast way out can look like a lifeline. Recently, more of these ads have been showing up in homeowners’ feeds.
Some of the companies behind them say they can “effortlessly” cancel your solar contract. Others guarantee specific results or say they’ve already canceled thousands of contracts.
Before you sign anything, know this: no one can honestly guarantee a solar panel cancellation. Many of these offers come from non-attorney marketing companies, not law firms. Some disputes can be resolved through negotiation. Others require a claim in court or arbitration, where a licensed attorney can represent you. The right approach depends on your agreement and the facts of your case.
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Below, we explain who is behind many of these offers, why guarantees are a warning sign, and what to check before you pay anyone an upfront fee.
Who Is Behind Solar Panel Cancellation Ads?
Some solar panel cancellation ads come from marketing companies rather than law firms. Similar promises have appeared in the timeshare exit industry, where the Federal Trade Commission (FTC) has warned consumers about guarantees and large upfront fees. The FTC’s warning concerns timeshares, but these promises are also worth questioning when you see them in a solar cancellation ad.
The fine print often tells you who you’re dealing with. Some of these companies’ fee agreements say outright that the company is not a law firm and does not provide legal services.
Fees are another concern. Before paying, make sure you understand what services the fee covers and who will perform them.
Can a Company Guarantee It Will Cancel Your Solar Contract?
No company can promise the outcome of a contested solar contract claim. A lawyer’s statements about possible results must be truthful and must not create unjustified expectations. The outcome depends on your contract, the facts, applicable law, and how the dispute is resolved.
In Texas, Rule 7.01 of the Texas Disciplinary Rules of Professional Conduct treats a lawyer’s statement as misleading if it is substantially likely to create unjustified expectations about the results the lawyer can achieve. That’s why a law firm talks about possible outcomes rather than promised ones.
Depending on the facts, possible outcomes of a solar dispute may include changes to the loan obligation, a settlement, credit-related relief, or other remedies. None of them is automatic. If an offer sounds too good to be true, it usually is.
When a Solar Contract Dispute May Require an Attorney
Some solar contract disputes can be resolved through negotiation; others proceed in court or arbitration. Arbitration is a private process in which a neutral arbitrator, rather than a judge or jury, decides the dispute. Many solar financing agreements contain arbitration provisions that may affect where and how a homeowner can bring a claim.
A letter or basic file review may not be enough to resolve a dispute. If a formal claim is needed, the process may include:
- Reviewing the claim and the contract terms
- Collecting documents, such as the sales materials, loan agreement, and production data
- Filing a claim or arbitration demand
- Negotiating, where appropriate
- Arbitration or litigation, if required
- Resolution or award
The decision in arbitration rests with the arbitrator, which is why no company can guarantee the result. Learn more about what to expect in solar loan arbitration.
What Are the Risks of Hiring a Non-Attorney Cancellation Company?
One risk is paying a substantial upfront fee without understanding what work the company will perform. Before paying, ask who will review your agreement, whether an attorney will handle your case, and what happens if the company cannot obtain the result it advertised.
Other risks to watch for:
- Unclear referral and fee arrangements. Ask whether the company will refer your matter to a lawyer, which lawyer will handle it, what each party will charge, and whom you will hire under the written agreement. Texas Rule 5.04
- Unexpected additional costs. The company’s fee may not cover legal representation. Ask whether hiring an attorney later would require a separate payment.
How Is a Solar Lawyer Different From a Cancellation Company?
A licensed solar lawyer can file claims, appear in court or arbitration, and give legal advice. A marketing company can do none of these. Here’s how the two typically compare:
| Question | Nonlawyer marketing company | Licensed law firm |
|---|---|---|
| Can it represent you in court or arbitration? | No | Yes, where its attorneys are authorized to practice |
| Can it give legal advice? | No | Yes |
| Can it guarantee the outcome? | No company controls the outcome | Must avoid misleading promises about results |
| Is it bound by lawyers’ professional conduct rules? | No | Yes |
| Where are its services and fees explained? | Check the company’s written agreement | Check the firm’s written engagement agreement |
A lawyer can also help you understand important distinctions, such as the difference between the installer’s obligations and the lender’s financing obligations. When an installer goes out of business or fails to finish the job, that does not automatically eliminate your loan. Read more about what happens to your solar loan if the installer goes out of business.
What Should You Do Before Paying a Solar Cancellation Company?
Before you sign an agreement or pay an upfront fee, confirm that you’re working with a licensed law firm. Take these steps:
- Check the license. Search your state bar’s attorney directory. In Texas, use the State Bar of Texas attorney search. Make sure a licensed attorney will actually handle your matter.
- Read the fee agreement. Look for statements that the company is “not a law firm” or “does not provide legal services.”
- Treat guarantees as a red flag. Any company that guarantees a cancellation or a specific outcome is promising something no one can deliver.
- Ask who does the work. Find out whether your case will be referred to someone else, and who that person is.
- Look for relevant experience. Solar disputes often involve installers, lenders, loan servicers, arbitration clauses, and the FTC Holder Rule. Choose attorneys who regularly handle these matters.
Be careful about big financial moves while you decide. Before stopping payments or refinancing a disputed solar loan, consider having an attorney review your situation. Either decision can have consequences for your credit and your claims. Find out more about whether to keep paying your solar loan during a dispute.
FAQs: Solar Panel Cancellation Companies
Q: Can I get out of my solar panel contract?
A: It depends on your contract, the representations made during the sale, the financing structure, and applicable law. Possible outcomes may include a settlement, changes to the loan obligation, or other remedies, but no outcome is guaranteed.
Q: Are solar cancellation companies legitimate?
A: Some are marketing companies rather than law firms. Before paying, find out who will perform the work, whether an attorney will represent you if needed, and exactly what the written agreement promises.
Q: Why won’t a lawyer guarantee my solar contract will be canceled?
A: Lawyers are ethically prohibited from creating unjustified expectations about results. Outcomes depend on the facts, the law, and the judge or arbitrator who decides the case.
Q: Does my solar loan go away if the installer goes out of business?
A: Not automatically. The installer’s obligations and your financing obligations are separate. Whether you have claims or defenses against the lender depends on your contract, the transaction structure, and applicable law.
Q: What should I do if I already paid a cancellation company?
A: Gather your fee agreement, receipts, and communications. Then consider having a licensed attorney review your situation and any options that may be available.
Get Your Solar Contract Reviewed by a Licensed Law Firm
If you’re considering help with a solar contract dispute, find out exactly who will handle your matter and what they can do for you. A licensed attorney can assess potential claims, explain your options, and represent you if proceedings are needed. No one can guarantee a particular outcome.
Prevost Law Firm handles disputes involving solar installers, lenders, financing companies, and related parties. We’ll review your situation and help you understand the options that may fit your circumstances.
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This content is for informational purposes only and does not constitute legal advice or create an attorney-client relationship.
