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6 Percent Simple Interest
ORS 311.674(3)
Deferral accounts accrue simple interest at the rate of 6 percent. Interest continues to accrue each year on the deferred tax amounts, paid to the county.
 
Simple interest is different from the compounded interest that credit card accounts accrue. Simple interest means that the interest computes yearly against the deferred tax amounts. Compound interest means interest is computed using both the amount charged (deferred taxes) and previous unpaid interest.
 
If you compare our 6 percent simple interest to 6 percent compounded interest charged by credit cards, the simple interest you pay would be significantly less.
 
For example, the table below shows deferred property taxes and the simple interest that accrues during that time.
 

Senior/Disabled Programs: 

Property Tax Year
Property
Tax Paid

Deferred Tax
Running Balance

Lien Fees
6% Simple Interest
2010–2011
$1,000.00
$1,000.00
$40.00
$0.00
2011–2012
$1,000.00
$2,000.00
($1,000 + $1,000)
0.00
$60.00
(.06 × $1,000)
2012–2013
$1,000.00
$3,000.00
($2,000 + $1,000)
0.00
$120.00
(.06 × $2,000)
2013–2014
$1,000.00
$4,000.00
($3,000 + $1,000)
0.00
$180.00
(.06 × $3,000)
2014–2015
$1,000.00
$5,000.00
($4,000 + $1,000)
0.00
$240.00
(.06 × $4,000)
Five Year Total
$5,000.00
$5,000.00
(5 years × $1,000)
$40.00
$600.00
($60+$120+$180+$240)
Total amount owed after five years in the program = $5,640
($5,000 tax + $40 lien fees + $600 interest)
 

Special Assessment Program:

Payment Date
Installment Amount Paid
Deferred Installment Running Balance
6% Interest Accrual
February 2011
$300
$300
$9
August 2011
$300
$600 ($300 + $300)
$18
February 2012
$300
$900 ($600 + $300)
$27
August 2012
$300
$1,200 ($900 + $300)
$36
February 2013
$300
$1,500 ($1,200 + $300)
$45
August 2013
$300
$1,800 ($1,500 + $300)
$54
February 2014
$300
$2,100 ($1,800 + $300)
$63
August 2014
$300
$2,400 ($2,100 + $300)
$72
February 2015
$300
$2,700 ($2,400 + $300)
$81
August 2015
$300
$3,000 ($2,700 +$300)
$90
 Total amount owed = $3,000
 $495