Reverse Mortgages and Home Loans in Oregon

I've helped a lot of Oregon homeowners think through reverse mortgages, and the conversation almost always includes one question people don't expect: are you in the state's property tax deferral program?

That's the big Oregon wrinkle, and this page explains it. It also covers how Oregon property taxes work, insurance in wildfire country, and the other home loans we help Oregonians with.

The short version

• We help Oregon homeowners and buyers with reverse mortgages, purchases, refinances, home equity, and VA loans.
• Reverse mortgage options include the HECM, the HECM for Purchase, and proprietary (jumbo) programs. Finance of America's HomeSafe Standard, one of the programs we compare, is approved in Oregon.
• Oregon's Senior and Disabled Property Tax Deferral generally doesn't accept new applicants with a reverse mortgage. If you're in it now, the deferred taxes usually have to be paid off at closing.
• Measure 50 limits how fast your assessed value can grow. A reverse mortgage doesn't change that.
• Insurance in wildfire areas can be a challenge. Plan for it before you plan the loan.

Reverse mortgages in Oregon

There are no required monthly mortgage payments with a reverse mortgage. You must continue to pay property taxes and homeowners insurance, maintain the home, and meet the other loan terms.

Oregonians use reverse mortgages to:

• Pay off an existing mortgage and free up monthly cash.
• Set up a line of credit for emergencies, care at home, or a down stretch in the market.
• Add monthly income.
• Buy a home that fits the next stage of life with a HECM for Purchase, like a single-level home closer to family.

HECM

The FHA-insured HECM is the most common reverse mortgage in Oregon. It comes in fixed-rate and adjustable versions. How much you can access depends on the youngest borrower's age (or an eligible non-borrowing spouse's), current rates, and your home's value up to the national HECM limit. See How a Reverse Mortgage Works and Lending Limits.

Jumbo (proprietary) reverse mortgages

If your home is worth well above the HECM limit, a jumbo program may open up more money. As a broker, we compare jumbo programs from several lenders. Programs we compare include Mutual of Omaha Secure Equity, Finance of America HomeSafe, Longbridge Platinum, Smartfi Choice, Nationwide Equities EquityPower, and MCM Holdings MCM Edge. Availability varies by state and changes over time. See Proprietary (Jumbo) Reverse Mortgages.

Oregon's property tax deferral and reverse mortgages

This is the section I'd read twice.

What the deferral program is

Oregon's Senior and Disabled Property Tax Deferral program, run by the Department of Revenue, lets qualifying homeowners put off paying their property taxes. The state pays the county, and the deferred taxes plus interest become a lien on the home, repaid later, usually when the home is sold.

Why it matters for a reverse mortgage

Since 2011, the program generally hasn't accepted new applicants who have a reverse mortgage. There's one narrow exception: a reverse mortgage taken out between July 1, 2011 and December 31, 2016, with at least 40 percent equity at the time of application.

In practice, that means:

• If you're in the deferral program now and want a HECM, the deferred taxes generally have to be paid off at closing, usually from the loan. After that, you pay your property taxes yourself, every year. HUD rules don't let a HECM borrower take part in a property tax deferral program, or have other liens on the home, unless those liens are subordinate to the HECM.
• If you have a reverse mortgage now, you generally can't join the deferral program.

Neither is a reason to skip a reverse mortgage. It's a reason to do the math honestly. Paying off a deferral lien lowers the money you'll have for other things, and losing the deferral means a property tax bill you'll need to budget for. I'll lay out both before you decide. You can also call the Oregon Department of Revenue to confirm your status.

Oregon property taxes: Measure 50

Oregon taxes homes on assessed value, which isn't the same as market value. Under Measure 50, assessed value generally can't grow more than 3 percent a year. If you've owned your home a long time, your assessed value may be well below what it would sell for.

A reverse mortgage doesn't reset your assessed value. In Oregon, assessed value generally doesn't reset even when a home is sold. You still have to keep paying your property taxes under the loan terms.

Insurance in Oregon

With a HECM, you must keep homeowners insurance on the home. In parts of Oregon with high wildfire risk, finding coverage has gotten harder and more expensive.

• The Oregon FAIR Plan is the state's insurer of last resort for homeowners who can't get coverage in the regular market.
• Flood insurance is required if the home is in a FEMA Special Flood Hazard Area.

Get insurance quotes early. The HECM financial assessment looks at whether you can keep up with taxes and insurance, and if it looks tight, part of the loan can be set aside to pay them for you.

Manufactured and rural homes

A lot of Oregon homes sit on acreage or are manufactured homes. A manufactured home can qualify for a HECM if it meets FHA's rules, including being built after June 15, 1976, on a permanent foundation, and classified as real property. Homes on larger parcels can often qualify too, but the appraisal has to support the property as a residence. See Can I do a reverse mortgage on a manufactured home that has a stick built addition?

Home loans in Oregon

Reverse mortgages aren't all we do. We also help Oregonians with:

• Buying a home, with conventional, FHA, VA, and jumbo loans. See Buy a Home, Conventional Loans, FHA Loans, and Jumbo Loans.
• Refinancing to change your rate or term, or take cash out. See Refinance.
• Home equity, with HELOCs and home equity loans. See Home Equity.
• VA loans for eligible veterans, service members, and surviving spouses. See VA Loans.

For a personalized quote, see Get a Rate Quote.

Oregon cities

We work with homeowners across the state by phone, video, or in person. See our page for Portland.

Where people get tripped up

• Not mentioning the deferral program. If you're in it, tell us right away. It changes the numbers.
• Expecting to keep deferring after a HECM. Generally you can't.
• Waiting on insurance. In wildfire areas, coverage can take time to line up.
• Assuming acreage doesn't qualify. It often can, but the appraisal has to support it.

A checklist for Oregon homeowners

Before we run your numbers, gather what you can on these:

1. Your property tax bill. Note whether it shows a deferral, and the amount if it does.
2. Your deferral status. If you're in the Senior and Disabled Property Tax Deferral program, ask the Department of Revenue for a payoff amount.
3. Your homeowners insurance declarations page. Check the coverage and the renewal date.
4. Your flood zone. Your county or FEMA's flood map can tell you whether flood insurance will be required.
5. Your mortgage statement, if you still have a mortgage.
6. Who lives in the home. If your spouse is younger than 62, read the Non-Borrowing Spouse guide first.
7. Your plans. How long you expect to stay, and what you need the money for.

Please don't send documents through the website. Your loan officer will tell you what's needed and the safe way to share it.

Common questions

Can I get a reverse mortgage in Oregon if I'm in the property tax deferral program?

Yes, but the deferred taxes generally have to be paid off at closing, and you generally can't stay in the program afterward. We'll factor the payoff into your estimate.

Does a reverse mortgage change my Oregon property taxes?

Not by itself. It won't reset your assessed value. In Oregon, assessed value generally doesn't reset even when a home changes hands. You still must pay the taxes.

Are jumbo reverse mortgages available in Oregon?

Several programs may be, but each lender approves states and property types on its own. I'll check the programs we compare for your home.

Can I use a reverse mortgage to buy a home in Oregon?

Yes, with a HECM for Purchase. You make a down payment, and there are no required monthly mortgage payments afterward. You must continue to pay property taxes and homeowners insurance, maintain the home, and meet the other loan terms. See HECM for Purchase.

What if I can't find homeowners insurance?

Talk with an independent agent and ask about the Oregon FAIR Plan. You need coverage that meets the lender's requirements before a HECM can close.

Next step

Get your estimate, start your reverse mortgage review, or find a loan officer for Oregon. You can also call us at 530-888-6000. For the full picture, start with Reverse Mortgages.

Sources

• Oregon Department of Revenue, Senior and Disabled Property Tax Deferral Program: oregon.gov
• "Oregon State Legislature Bars Reverse Mortgages from Tax Deferral Program," HousingWire, July 18, 2011: housingwire.com
• City of Corvallis, How Measures 5 and 50 Affect Your Property Taxes: corvallisoregon.gov
• Oregon Division of Financial Regulation, FAIR Plan coverage increases, May 11, 2023: dfr.oregon.gov
• HUD, FHA Reverse Mortgage for Seniors (HECM): hud.gov