PACE Financing for Windows in Utah: Zero Down, Property Tax Repayment

With the federal window tax credit expired as of December 31, 2025, Utah homeowners are looking for new ways to make window replacement affordable. PACE financing, which stands for Property Assessed Clean Energy, is one of the most powerful tools available. It eliminates the upfront cost entirely and allows you to repay through your property tax bill over 10 to 25 years.

This guide explains how PACE works, whether you qualify, what it costs, and how it compares to other financing options. For the complete picture of every savings program available in 2026, see our Utah window rebates and incentives guide.

What Is PACE Financing

PACE is a financing mechanism that allows homeowners to fund energy efficiency improvements, including window replacement, through a voluntary special assessment on their property tax bill. Instead of paying out of pocket or taking out a traditional loan, the PACE provider pays your contractor directly, and you repay over time through an additional line item on your property tax statement.

PACE was created to remove the upfront cost barrier that prevents many homeowners from making energy-efficient upgrades. It has been used across the country for solar panels, HVAC systems, insulation, and window replacement.

How PACE Is Different from a Traditional Loan

Feature	PACE Financing	Traditional Loan
Attached to	Property	Person
Credit requirement	Property equity-based	Credit score-based
Down payment	None	Varies (0-20%)
Repayment	Property tax bill	Monthly loan payment
Transfers on sale	Yes (to new owner)	No (must be paid off)
Collateral	Property tax lien	Varies by loan type

How PACE Works Step by Step

The PACE process follows a straightforward sequence:

Step 1: Check Availability

Verify that your Utah municipality has authorized a PACE program. Not all jurisdictions participate. Contact your city's building or energy department, or check with the Utah Energy Office.

Step 2: Apply for PACE Financing

Submit an application to an approved PACE provider in your area. The application includes information about your property, current mortgage, property tax status, and the proposed improvement project.

Step 3: Property Qualification

The PACE provider evaluates your property to confirm:

• Sufficient equity (typically 10% to 15% minimum)
• Property taxes and mortgage are current
• No recent foreclosure proceedings or bankruptcies
• The property is within a participating jurisdiction

Step 4: Project Approval

Your window replacement project is reviewed to confirm it qualifies as an eligible energy improvement. Energy-efficient windows with Energy Star certification readily qualify.

Step 5: Contractor Payment

Once approved, the PACE provider pays your window contractor directly. You pay nothing out of pocket at installation.

Step 6: Repayment Through Property Taxes

A voluntary special assessment is added to your annual property tax bill. You repay the financed amount plus interest over your chosen term (typically 10, 15, 20, or 25 years).

PACE Eligibility Requirements in Utah

Utah has enabling legislation for PACE under Title 11, Chapter 42a of the Utah Code. However, each municipality must individually authorize PACE within its jurisdiction.

Property Requirements

• Residential property within a participating Utah municipality
• Sufficient equity: Typically 10% to 15% or more
• Current on property taxes: No delinquent property tax payments
• Current on mortgage: No late mortgage payments in the past 12 months
• No recent bankruptcies: Generally no bankruptcies in the past 3 to 5 years

Project Requirements

• Energy efficiency improvement: Window replacement with Energy Star certified products qualifies
• Licensed contractor: Installation must be performed by a licensed, insured contractor
• Minimum project size: Some programs have a minimum project cost (often $5,000)
• Maximum project size: Typically capped at 15% to 20% of your property's assessed value

Mortgage Lender Consent

This is an important consideration that many homeowners overlook. Because the PACE assessment creates a lien on your property that has priority over your mortgage, most PACE programs require your mortgage lender to consent to the assessment. Some lenders are resistant to this, which can delay or prevent PACE financing.

Before investing significant time in the PACE application process, contact your mortgage lender to ask about their PACE policy.

PACE Costs and Interest Rates

PACE financing is not free money. Like any financing product, it has costs that you should understand before committing.

Interest Rates

PACE interest rates typically range from 6% to 9%, fixed for the life of the assessment. This is:

• Higher than a home equity loan or HELOC (typically 7% to 10% variable)
• Similar to some contractor financing programs
• Lower than credit cards (18% to 25%) and most personal loans (8% to 18%)

Fee Structure

• Origination fee: 2% to 5% of the financed amount
• Recording fee: A small fee for recording the assessment with the county
• No prepayment penalty: Most PACE programs allow early payoff without penalty

Payment Example

Here is what a PACE-financed window project might look like:

For a $6,000 window project financed over 15 years at 7.5% interest:

• Total financed: $6,180 (including 3% origination fee)
• Annual property tax addition: Approximately $688 in year one (decreasing as principal is paid down)
• Monthly equivalent: Approximately $57
• Total cost over 15 years: Approximately $9,500 (including all interest)

Compare this to the alternative of not replacing your windows: if your old windows are costing you $80 per month in excess energy bills, the PACE payment is less than the energy savings, making it cash-flow positive from day one.

PACE vs Other Financing Options

Feature	PACE	HELOC	Contractor 0% Promo	Personal Loan
Down payment	$0	$0	$0	$0
Interest rate	6-9% fixed	7-10% variable	0% (12-24 months)	8-18% fixed
Term	10-25 years	Variable	12-24 months	3-7 years
Credit requirement	Property equity	Good credit	Good credit	Good credit
Transfers on sale	Yes	No	No	No
Tax deductible interest	Possibly	Yes (home improvement)	N/A	No
Risk if default	Property tax lien	Home equity lien	Collections	Collections

When PACE Makes the Most Sense

PACE is the strongest option when:

• You have limited cash reserves and cannot afford the upfront cost
• Your credit score is below 680, making traditional loans expensive or unavailable
• You want a long repayment term to keep monthly costs low
• You plan to sell within a few years and want the improvement to benefit the sale without paying off the full cost yourself

When Other Options Are Better

Consider alternatives when:

• You have strong credit (720+): A HELOC may offer a lower interest rate
• You can pay off within 2 years: Contractor 0% financing saves you all interest costs
• Your lender will not consent: Without lender consent, PACE is not an option
• You are in a non-participating municipality: PACE is not available everywhere

Advantages and Disadvantages of PACE

Advantages

• Zero out of pocket: No cash needed at the time of installation
• Property-based qualification: More accessible than credit-based loans
• Long terms available: 10 to 25 years keeps payments manageable
• Transferable: If you sell, the remaining balance goes to the buyer
• Potential tax benefit: Interest may be deductible as a property tax expense
• Stackable: You can still claim utility rebates on top of PACE financing

Disadvantages

• Higher interest rates: 6% to 9% is more expensive than some alternatives
• Lender consent required: Your mortgage company must agree
• Not universally available: Depends on your municipality
• Property tax lien: Failure to pay can lead to tax lien consequences
• Transferability concern: Some home buyers may view the assessment negatively
• Total cost: Long terms mean you pay significant interest over the life of the assessment

How to Apply for PACE in Utah

Step 1: Verify Municipal Participation

Contact your city or county government to confirm PACE is authorized in your jurisdiction. You can also check with the Utah Energy Office at energyoffice.utah.gov.

Step 2: Identify Approved PACE Providers

Your municipality will have one or more approved PACE administrators. Get contact information from your city government or the Utah Energy Office.

Step 3: Get Pre-Qualified

Submit a pre-qualification application to the PACE provider. This typically requires:

• Proof of property ownership
• Current property tax statement showing no delinquency
• Mortgage lender information
• Estimated project scope and cost

Step 4: Obtain Lender Consent

Contact your mortgage lender to request PACE consent. Provide them with documentation from the PACE provider explaining the assessment.

Step 5: Get Window Quotes

With PACE pre-qualification in hand, get quotes from licensed contractors. Let them know you are using PACE financing, as many contractors are familiar with the process.

Step 6: Finalize and Install

Once your PACE financing is approved and your contractor is selected, schedule the installation. The PACE provider will pay the contractor directly upon completion.

Step 7: Apply for Utility Rebates

After installation, apply for Rocky Mountain Power Wattsmart and Dominion Energy ThermWise rebates. These rebate checks come to you directly, effectively reducing your net cost even further. See our 2026 savings stacking guide for details.

PACE and Home Sales: What Happens When You Sell

One of the most common questions about PACE is what happens when you sell your home. The answer is straightforward but has important implications.

The Assessment Transfers

The PACE assessment is tied to the property, not to you personally. When you sell, the remaining balance automatically transfers to the new owner as part of the property's tax obligations. You do not need to pay off the PACE balance at closing.

Disclosure Is Required

You must disclose the PACE assessment to potential buyers. It will also appear in the title search during the closing process. Most real estate agents are familiar with PACE assessments and can explain them to buyers.

Impact on Sale Price

A PACE-financed window upgrade can actually help your sale:

• Newer, energy-efficient windows increase your home's appeal and value
• The annual PACE payment is offset by the energy savings the buyer will realize
• Energy-efficient homes sell faster and at higher prices in Utah's market

However, some buyers may view the assessment negatively, particularly if they do not understand how PACE works. Working with an agent experienced in PACE transactions can help mitigate this concern.

PACE financing is not the right choice for everyone, but for homeowners who need to replace windows and lack the upfront capital, it is one of the most accessible financing tools available in 2026. Combined with utility rebates, it makes window replacement achievable regardless of your savings or credit situation. Start by checking availability in your municipality and getting pre-qualified through an approved PACE provider.

For the complete overview of every 2026 savings program, visit our Utah window rebates and incentives guide.