It was an interest rate so low that John Ahnemann felt he couldn’t turn it down.
So Ahnemann, a real estate agent living in St. Paul’s Midway neighborhood, signed the paperwork last year for a $46,500 loan at 3.49% interest to put 17 solar panels on his house and garage.
“I have no idea how they’re able to do this,” he said, recalling his thinking at the time.
It wasn’t until after the panels were installed that Ahnemann found out. Financing the project inflated its price by roughly $13,000 with the inclusion of a “dealer fee,” he said
Ahnemann said the surcharge wasn’t properly disclosed ahead of time. His financing company disagrees. But Ahnemann and others have found an ally in Attorney General Keith Ellison.
Ellison is suing four prominent solar lending companies, accusing them of concealing and improperly charging $35 million in fees to Minnesotans since 2017. Ellison says artificially low interest rates discourage people from shopping around for better deals with traditional lenders.
“Unfortunately, there are some bad actors that have taken advantage of Minnesotan’s enthusiasm for doing good, as well as the public incentives created to make residential solar more affordable,” Ellison said in a statement.
The lending companies reject those claims and say their disclosures follow the law. The case hasn’t yet gone to trial.