SAN DIEGO -Renovate America issued the following statement regarding an article published today in The Wall Street Journal:
Renovate America seeks to lead the home-improvement industry in protecting consumers and in tightening standards for contractors with whom we do business. We are fully cooperating with an FBI investigation into a contractor and its affiliated entities who offered their home-improvement customers financing from several Property Assessed Clean Energy (PACE) administrators, including Renovate America. This contractor and its entities were never employed by Renovate America, and our company no longer does business with them. In conversations with federal law-enforcement authorities and prosecutors as recently as this past week, we have been repeatedly assured that Renovate America is not a subject or target of that or any federal investigation.
How contractors market their services has long been an issue in home improvement, which is why Renovate America helped lead in working with consumer advocates, environmental organizations, and local governments a successful legislative effort this year to create a comprehensive regulatory and consumer-protection framework in California, where the bulk of PACE home-improvement financing is done. Among the provisions in the bills that legislators overwhelmingly approved were new regulations on contractor marketing, training and licensing requirements, and the accountability of PACE providers for how contractors introduce the financing to homeowners.
With the legislation just passed in California, the PACE product has fundamentally changed in its largest market, requiring income-based underwriting and a determination of a homeowner’s ability to pay, and licenses PACE providers contingent on their compliance with a robust statutory consumer protection framework.
Finally, Renovate America has received a request for information from the Securities and Exchange Commission in relation to a prior Wall Street Journal story about assistance provided to 86 homeowners — something that we disclosed to investors and which was included in presale reports by rating agencies Kroll and DBRS in April and July. We are cooperating with the information request and believe it is unlikely to have a material effect on the business.
Over the last two years, Renovate America has amended more than 60 specific processes in our business to better ensure homeowners understand their PACE financing obligation, put in place a contractor rating system that has resulted in severing business ties with more than 100 contracting firms, and have pushed for state regulation. Every employee of Renovate America clearly knows that helping homeowners is at the heart of our business and mission.
About Renovate America
Renovate America offers a tech-enabled financing platform for home improvements that empowers communities to modernize and make their housing stock more efficient, while giving small businesses the tools they need to grow. In addition to financing home improvements through an unsecured lending product, Benji, Renovate America offers communities HERO financing. HERO is the leading residential Property Assessed Clean Energy (PACE) program in the U.S. and has been used by over 100,000 homes to make energy and efficiency improvements. It is estimated that HERO is on track to save billions of dollars in energy and water bills, and has created over 20,000 local trade jobs that cannot be offshored or automated. Renovate America has built the world’s largest green bond platform, with a volume of originations that enables securitization of HERO PACE bonds multiple times a year, attracting international investment to meet U.S. clean-energy objectives.