What Happens After I No Longer Qualify for a Property Tax Deferral in Texas?


A property tax deferral is a useful tool available to qualifying Texans that can be used to defer or delay when they have to pay their property taxes to the government. But there are circumstances in which taxpayers who once qualified will no longer be able to defer their taxes. Here we look into what a tax deferral is, who can get one, and what happens when you no longer qualify for a deferral. We will also discuss what you can do when the deferred tax and accrued interest are due for payment.

What is a tax deferral?

It is important to know what a tax deferral is not. A tax deferral is not an exemption from paying your property taxes. A tax deferral will only delay or postpone when you must pay your taxes. You will be charged interest until the tax is paid, but there will be no penalties or charges for delinquency. Additionally, there will be a tax lien on the property until the deferred taxes are paid off.

Who can qualify for a deferral?

According to the Texas Tax Code, homeowners with a disability, disabled veterans, or those over 65 years of age who have a tax imposed against a property they own and occupy as a residence homestead can qualify for a deferral. To verify their eligibility, a disabled person must provide an Affidavit of Disability from the Social Security Administration and/or a Physicians Statement verifying the specifics of their disability.

Eligible homeowners can obtain a deferral by filing a tax deferral affidavit with the chief appraiser at their local county appraisal district. Following approval, the county appraisal district will notify each affected jurisdiction including, the county, school district, city, or other entity, that a tax deferral has been granted.

If you do not agree with the appraisal value of your property for local taxes, or if you have been denied a deferral, you can protest through the appraisal review board (ARB) in your district.

When will I no longer qualify for a deferral?

There are different circumstances in which you will no longer qualify for a deferral:

  1. If you no longer occupy the home as your principal residence.
  2. If the owner passes away. However, the deferral can transfer to the surviving spouse if they are 55 or older, own the residence, and lived there at the time of death.
  3. In some cases, when people with a mortgage switch lenders, they have found, while they qualify for the deferral under the law, the new lender, nevertheless, requires the superior claim against the property, the property taxes to be paid, l and the property owner finds themselves owing thousands in back taxes.

After your deferral ends, you must pay all outstanding taxes and interest within 180 days. Immediately after the deadline, if there is still a due balance, the amount owed will be classified as delinquent property tax and taxing authorities may take further steps such as penalties and foreclosure.


Steps I can take after the deferral ends

Because you have been deferring your property taxes, potentially for years, you or your estate can end up with a tax bill of thousands of dollars. However, if you no longer qualify due to your home’s sale, you may be able to pay the taxes with the proceeds of the sale. In such a case, it is important you have a valid will that is probated so your heirs don’t have fractured ownership of your home, preventing borrowing against it or selling it.

But if you find yourself unable to pay the outstanding taxes, utilizing a property tax loan can help you get this debt under control and save you thousands in interest and penalties. Property tax loans provide the following benefits to homeowners:

  • Affordable monthly payment plans
  • Flexible repayment terms
  • Avoid foreclosure
  • Stops the accumulation of penalties and fees
  • Relief and peace of mind

About AFIC

Founded in 1946, American Finance & Investment Co., Inc. (AFIC) started by serving the financial needs of El Paso and has since grown to become one of the top property tax lenders in the state of Texas, with a complaint-free track record for over 65 years with the Better Business Bureau.

We offer our clients an affordable, hassle-free way to ensure that your account with the local government tax office is paid in full and will work out a manageable repayment plan for you. AFIC can provide you with an instant quote by completing the form on our homepage. For qualifying properties, we can help you pay off your delinquent property taxes and offer you the following benefits:

  • Quick and completely online process
  • No money down
  • No credit check
  • Free 30-day rate match
  • Match competitors and beat their rate by 1%
  • Avoid high penalties and foreclosure

We pride ourselves on finding solutions to suit the unique needs of our clients. If you would like to discuss our Texas property tax deferrals or our property tax loans, please contact our experienced team at AFIC today.

Ernest Eisenberg

Ernest Eisenberg, President of American Finance & Investment Co., Inc. (AFIC), brings a wealth of expertise in non-traditional financing, including property tax loans and non-bank mortgage solutions. His vision is characterized by a commitment to offering flexible financing solutions to Texas property owners.

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If you are over 64 or disabled, don’t get a property tax loan, contact your tax office about a deferral.

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