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Tax Deferrals Over for Reverse Mortgage Holders

In Oregon, senior citizens with reverse mortgages will no longer be eligible for the state's tax deferral program. The initiative, which covered property taxes for low-income seniors fighting to stay in their homes, recently announced that applicants with reverse mortgages won't be considered for the Senior Disabled Property Tax Deferral Program.


Homeowners already using the deferral advantage were told in July that they are required to reapply for the statewide program no later than July 25. In an attempt to explain the legislative decision, Oregon's ""Revenue Department"":http://www.oregon.gov/DOR/ released a statement, saying, ""The deferral program recovers its funds from the sale of properties leaving the program. If there is no equity left in a home, there may be no way to pay back the deferred taxes. This leaves the program with fewer funds to help other seniors in need. For that reason, the 2011 Legislature barred reverse mortgage properties from the program.""

Additional alterations to the program's format include more stringent asset limits, stricter income criteria, and a five-year minimum for prior residency in the qualifying home.

In its original format, the deferral system allowed Oregonians over 62 years of age with less than $39,500 in taxable income per year to defer tax payments until the sale of their home, with no limitations on the type of mortgages involved. The current alterations resulted in a flood of more than 2,200 phone calls regarding the program's new rules, according to the ""_Oregonian_"":http://www.oregonlive.com/oregonian/.


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