How to Cancel a Solar Panel Contract or Lease (Without Getting Trapped)

Solar panels seem like a great deal when the salesperson shows you projected savings — but many consumers later discover their lease payments exceed electricity savings, their roof needs repair underneath panels, or they need to sell their home and the lease complicates the sale.

Getting out of a solar contract is notoriously difficult, but not impossible. This guide covers your options whether you're within the cooling-off period, dealing with misrepresentation, or stuck in a long-term lease or PPA.

Types of Solar Contracts (and Cancellation Difficulty)

Solar Lease

• You lease the panels for 20-25 years
• Fixed monthly payment regardless of energy produced
• Company owns the panels and is responsible for maintenance
• Cancellation difficulty: High — requires paying remaining lease payments or negotiated buyout

Power Purchase Agreement (PPA)

• You buy the electricity the panels produce at a set rate
• Rate may escalate annually (1-3% typical)
• Company owns the panels
• Cancellation difficulty: High — similar to lease, must buy out or transfer

Loan (You Own the Panels)

• You took a loan to purchase the system outright
• You own the panels and all electricity produced
• Cancellation difficulty: Medium — you can sell/remove the panels, but still owe the loan balance

Cash Purchase

• You paid upfront for the system
• You own everything
• Cancellation difficulty: Low — you can remove panels (but it's a sunk cost)

Cancellation Within the Cooling-Off Period

FTC Cooling-Off Rule (Door-to-Door Sales)

If a solar salesperson came to your home or contacted you at a location other than the seller's permanent place of business:

• 3 business days to cancel without penalty
• Must be notified of this right at time of sale
• Cancellation notice must be provided with the contract
• Send cancellation in writing (use form provided or write your own)

State-Specific Cooling-Off Periods

• California: 3 business days (plus specific solar consumer protections)
• New York: 3 business days
• Florida: 3 business days
• Texas: No general cooling-off, but door-to-door sales covered by FTC rule
• Many states: 3-10 days depending on sale type

How to Cancel During Cooling-Off:

1. Write a cancellation notice (date, your name, contract reference, "I hereby cancel")
2. Send via certified mail with return receipt
3. Hand-deliver a copy to the salesperson/office if possible
4. Keep a copy of everything
5. Do NOT let them convince you to "wait and see" — you can always re-sign later

Cancellation After Cooling-Off Period

If Installation Hasn't Happened Yet

Contact the company immediately. Many contracts have clauses allowing cancellation before installation begins, sometimes with a small cancellation fee ($500-$2,000). This is far cheaper than after installation.

Grounds for Contract Rescission (Fraud/Misrepresentation)

You may be able to void the contract entirely if:

• Savings were misrepresented: Salesperson promised specific dollar savings that aren't materializing
• System underperforms: Production is significantly below what was contractually guaranteed
• Material facts were hidden: Escalator clauses, fees, or terms not clearly disclosed
• Permits/HOA approval failed: If the system can't legally be installed as contracted
• Contractor license issues: Company wasn't properly licensed in your state

Steps for misrepresentation claims:

1. Document the discrepancy (promised vs. actual savings/production)
2. Send a demand letter citing specific misrepresentations
3. File complaints with: state attorney general, state contractor licensing board, FTC, CFPB
4. Request rescission (complete contract cancellation and removal at company's expense)

Negotiating an Early Buyout

If you don't have grounds for rescission but need to exit:

1. Request your buyout amount in writing from the solar company
2. Negotiate — companies often accept less than the full remaining balance to avoid a hostile customer
3. Leverage refinancing: Some solar companies will restructure terms
4. Timing matters: Buyout amounts decrease over time as the contract ages
5. Compare to removal cost: Getting an independent quote for panel removal can inform negotiation

Transferring the Contract

If you're selling your home:

• Most solar leases/PPAs are transferable to the new homeowner
• Buyer must meet credit requirements
• Include the solar company in real estate negotiations early
• Some contracts offer a streamlined transfer process
• If buyer refuses the lease, you may need to buy it out before closing

Specific Company Policies

Sunrun

• Allows lease transfer to new homeowner with credit check
• Buyout options available (contact for current pricing)
• Has been subject to state AG complaints for sales practices

SunPower/Maxeon

• Transfer program for home sales
• Prepayment/buyout options vary by contract year
• Contact customer service for current buyout calculation

Vivint Solar (now Sunrun)

• Merged with Sunrun — contact Sunrun for all Vivint contracts
• Historical complaints about sales practices may support rescission claims

Tesla Solar

• Subscription model allows cancellation with panel removal (fee may apply)
• Loan purchases: standard loan terms apply
• Cash purchases: you own the system outright

When to Get Legal Help

Consider a solar contract attorney if:

• Buyout amount exceeds $15,000
• You have strong evidence of misrepresentation
• The company is ignoring your cancellation attempts
• You're facing a home sale deadline
• Multiple consumers were affected (potential class action)

Many consumer attorneys offer free consultations and work on contingency for fraud cases.

Quick Checklist

• [ ] Determined contract type (lease, PPA, loan, purchase)
• [ ] Checked if still within cooling-off period
• [ ] Reviewed contract for cancellation clauses and buyout terms
• [ ] Documented any misrepresentations (promised vs. actual savings)
• [ ] Contacted company for buyout amount in writing
• [ ] Filed state AG complaint if misrepresentation occurred
• [ ] Explored lease transfer option if selling home
• [ ] Consulted attorney for high-value contracts or fraud cases

Bottom Line

Solar contracts are designed to be difficult to exit — that's how companies guarantee their return on investment. But you have more options than the company wants you to believe: cooling-off periods, misrepresentation claims, negotiated buyouts, and lease transfers. The key is acting quickly within cancellation windows and documenting everything if the company made promises it didn't keep.

Sources

• FTC Cooling-Off Rule: https://consumer.ftc.gov/articles/buyers-remorse-ftcs-cooling-rule-may-help
• CFPB Solar Financing Guidance: https://www.consumerfinance.gov/about-us/blog/
• SEIA Consumer Protection: https://www.seia.org/initiatives/consumer-protection