How Pace Works


PACE is used to supplement traditional mortgage debt proceeds and complete a capital stack. PACE is instrumental in bridging funding gaps between the mortgage and equity. As an alternative form of capitalization, PACE may not apply toward HVCRE requirements.

Pace is not a mortgage

PACE assessments are collateralized by a special assessment lien, not a mortgage.   Unlike mortgages, PACE liens cannot be accelerated – meaning the loan cannot be called in the event of a default.  This is an importance distinction and gives mortgage lenders comfort when consenting to PACE.


PACE is available in 35 states plus the District of Columbia for eligible improvements.

PACE payment flow of funds

PACE loans are secured by a special assessment lien and are underwritten as a real estate tax. Because PACE is classified as an assessment/tax, owners have the added benefit of including the PACE payment as a reimbursable expense.

• PACE covers 100% of eligible costs

• 10-30 year terms

• Freely transferable upon sale

• Low-cost equity alternative