If you’re researching the Oregon Senior Tax Deferral Program, you’re probably asking a practical question: “Do I qualify for the Oregon Senior Tax Deferral Program?”

The program was designed to help seniors stay in their homes despite their fixed incomes stagnating while property taxes and inflation continue to rise. But before you commit to property tax deferral, it’s wise to compare it to another tool that can solve the same problem in a very different way: a reverse mortgage (especially a HECM). Not because one is always “better,” but because being educated helps you make a confident decision and understand what you’re saying “no” to.

Below is a clear breakdown of how the Oregon property tax deferral program works, how the interest accrues, and an example you can use to visualize the cost over time.

What is the Oregon Senior Tax Deferral Program?

The Oregon Senior and Disabled Property Tax Deferral Program allows qualifying homeowners to defer (delay) paying property taxes on their primary residence. Instead of you paying the county each year, the Oregon Department of Revenue pays the taxes on your behalf, and a lien is recorded against the property to be paid back later.

To qualify for the Oregon Senior Tax Deferral Program, here are the 2026 rules from the Oregon.gov website:

• The household income limit for 2026 is $70,000. Household income includes all taxable and non-taxable income of the applicant(s) and their spouse(s) that reside in the home for the prior (2025) calendar year. 
• Real market value (RMV) minimum cap amount for 2026 increased to $301,000. What this means is that if your homestead RMV exceeds the allowable limit in your county and for the number of years of residence, but is under the RMV minimum cap, you may still qualify. Review the RMV Table.
• House Bill 3712 relaxed the Real Market Value (RMV) limit for homeowners that owned and lived in their home less than 17 years. They may now qualify with their homestead RMV is less than 150 percent of the county’s median value of residential improved property.

You generally repay the deferred taxes later—often when the home is sold, ownership changes, or you no longer qualify and the account is disqualified/cancelled. The state must be repaid before the lien can be released. (Oregon) In some cases, the lien may even need paid back if the homeowner were to seek out a home equity loan or line of credit down the road due to the lien position.

The key details: the program charges interest

Deferral accounts accrue 6% interest yearly, and the interest is not compounded. The interest accrues on the tax amount paid by the Department of Revenue. (Oregon)

That “not compounded” part matters—because it’s simpler than compounding interest—but it can still add up meaningfully over time.

How interest works (in plain English)

• Each year the state pays your property taxes for you.
• That paid amount starts accruing simple interest at 6% per year (not compounded). (Oregon)
• The longer you defer, the longer each year’s tax advance has time to accrue interest.

So even though the interest doesn’t compound, the total payoff grows because new tax advances are added each year, and each advance accrues interest for as long as it’s outstanding.

Example: What a 5-year tax deferral might look like

Let’s say a homeowner defers $5,000 in property taxes per year for 5 years.

Because the state pays taxes each year, each year’s “advance” accrues interest for a different length of time:

• Year 1 taxes: $5,000 at 6% for 5 years → $1,500 interest
• Year 2 taxes: $5,000 at 6% for 4 years → $1,200 interest
• Year 3 taxes: $5,000 at 6% for 3 years → $900 interest
• Year 4 taxes: $5,000 at 6% for 2 years → $600 interest
• Year 5 taxes: $5,000 at 6% for 1 year → $300 interest

Totals after 5 years

• Deferred taxes paid: $25,000
• Total interest (simple, not compounded): $4,500
• Estimated payoff balance (before any fees/costs): $29,500

And remember: the program also requires repayment of recording/releasing lien costs (and a manufactured structure filing fee in some cases). (Oregon)

Why compare a reverse mortgage to the Oregon Senior Tax Deferral Program?

A reverse mortgage (most commonly a HECM) can sometimes be used to pay ongoing property charges, including property taxes and homeowners insurance, using the loan proceeds—depending on the borrower’s financial assessment and loan structure. (Consumer Financial Protection Bureau)

A few important points:

• With a reverse mortgage, you are still responsible for property charges like property taxes and homeowners insurance.
• The strategy may look different than tax deferral: instead of the state paying taxes and recording a lien for deferred taxes, you may use home equity through a reverse mortgage structure to manage cash flow and be able to afford to pay your taxes and avoid this lien.

This is why we encourage people to compare:
✅ both options affect home equity
✅ both options have costs (just structured differently)
✅ both options can support staying in the home longer

Questions to ask before choosing either option

If you’re deciding between the Oregon Senior Tax Deferral Program and a reverse mortgage approach, consider:

1. How long do you expect to stay in the home? (Time drives total interest in deferral.) (Oregon)
2. Is your priority: lowest cost, monthly cash flow relief, or flexibility for other expenses too?
3. Do you want the solution to only cover taxes—or also create a broader retirement cash-flow cushion?
4. What’s your long-term plan for the home? (sell later, leave to heirs, refinance, etc.)

Your answer to these questions will influence which option is optimal for your particular situation.

Bottom line: education first when considering the Oregon Senior Tax Deferral Program

The Oregon Senior Tax Deferral Program can be a helpful tool for the right household: especially when property taxes are the main pressure point.

But because the program includes 6% simple interest annually and creates a lien that must be repaid to release it, it’s smart to also learn how a reverse mortgage could address property taxes and retirement cash flow, so your decision is fully informed. (Oregon)

Call us today at 503-339-2343 to inquire about your reverse mortgage eligibility.

Disclaimer: This article is for educational purposes only and isn’t tax or legal advice. Always confirm eligibility and implications with the Oregon Department of Revenue and your trusted advisors.