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An Option for Seniors Who Cannot Afford Their Property Taxes

The California State Controller’s Office administers the Property Tax Postponement program that allows eligible homeowners to postpone paying their property taxes on their primary residence. The program allows for the deferral of the payment and secures repayment by placing a lien on the property, or if the home is a manufactured or mobile home, by a security agreement with the Department of Housing and Community Development. Applicants must be approved before they stop paying their property taxes in order to avoid penalties. They can be approved if they have delinquent taxes, but the State Controller’s Office will not pay delinquent taxes.

To be eligible, a homeowner must be 62 or older, blind, or disabled. The property must be occupied and owned as a principal place of residence. Currently, floating homes and houseboats are not eligible for the Property Tax Postponement program, but manufactured and mobile homes, either fixed or unfixed, are eligible. The homeowner must have at least 40% equity in the home, not have a reverse mortgage, and the total household income must be $35,500 or less.The interest rate for all taxes postponed under the program is 7% per year, computed monthly on a simple interest basis. This means that for every $1,000 in taxes deferred, the interest is $70 a year, or $5.83 per month. Interest accrues until all taxes plus interest are repaid. If approved, the State Controller’s Office will make a payment on your behalf directly to the county tax collector. It is the homeowner’s responsibility to contact their lender regarding payments through an impound or escrow account.

The homeowner can reapply each year as needed, but the program is not automatic, meaning you must re-apply each year that you want to be approved for the program. The homeowner can pay all or part of the balance at any time; however, all postponed taxes and interest immediately become due if the homeowner moves from the property, sells or conveys title to the property, dies and there is no surviving spouse or registered domestic partner who continues to reside on the property, allows future property taxes to become delinquent (outside of using the program to defer future taxes), or refinances or obtains a reverse mortgage.

Requirements for the Property Tax Postponement program are subject to change without notice if the law is revised, and all current program requirements can be verified with the California State Controller’s Office at any time.

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