Reverse mortgage in BC: how it works alongside property tax deferment for 55+

Short answer: A reverse mortgage in British Columbia lets homeowners usually aged 55 or older borrow up to about 55% of their home's value, tax-free, with no regular payments; the interest is added to the balance, and you repay when you sell, move out or the last borrower dies ^[1]. BC adds a second option for the same age group: the province's property tax deferment program, which pays your annual property taxes and puts a lien on your home ^[2]. Because both rely on your equity, the order matters.

This guide is for BC homeowners 55+, from Metro Vancouver and the Island to the Okanagan and the North, who are comparing ways to use their equity in retirement. It's general information; we recommend involving family and obtaining independent legal advice, OAC.

How a reverse mortgage works

FCAC describes a reverse mortgage as a loan for homeowners, usually 55 or older, that lets you borrow against your home equity without selling. You may usually borrow up to 55% of the current value of your home, and the money doesn't affect Old Age Security (OAS) or Guaranteed Income Supplement (GIS) benefits ^[1]. How much you can borrow depends on your age and the age of anyone else on title, your home's condition, type and appraised value, and your lender ^[1].

• The home usually must be your primary residence, which typically means living there at least six months a year ^[1].
• No regular payments are required. Your lender adds the interest to the balance, so what you owe grows over time ^[1].
• You repay when you sell, move out, the last borrower dies, or you default ^[1].
• Costs can include an appraisal, set-up fees, legal fees, closing costs and possible prepayment penalties ^[1].

For the full picture, see our guides to reverse mortgage requirements, costs and how much you can get.

Curious what you could access? A licensed 8Twelve agent can walk you through reverse mortgage options and compare them across lenders, OAC. See reverse mortgage options

BC's property tax deferment program

The Province of BC describes property tax deferment as a loans program: once you're approved, the Ministry of Finance pays your property taxes on your behalf after the due date and places a restrictive lien on your property ^[2]. The regular program is for people who are 55 or older, surviving spouses and people with disabilities ^[3]. Interest is charged on the deferred amount, and for taxes deferred in 2026 and later it is compound interest ^[2].

Eligibility includes living in the home as your principal residence, being a registered owner, and having lived in BC for at least a year before applying ^[3]. The equity rule is the one that interacts with a reverse mortgage: for the regular program you must maintain at least 25% equity, which means all charges registered against your property plus the taxes you want to defer can't exceed 75% of the BC Assessment value ^[3].

Reverse mortgage vs tax deferment: side by side

Worked example: how a reverse mortgage uses up deferment room

Example (illustrative): your home's BC Assessment value is $900,000. These numbers are assumptions, and a lender's appraisal may differ from the assessment.

Because lenders add interest to a reverse mortgage ^[1] and the deferment test counts all registered charges ^[3], a growing reverse mortgage balance can reduce your room to defer. If you plan to use both, ask both the province and your lender how they would sit together on your title before you commit.

Alternatives to compare first

FCAC suggests comparing other options before a reverse mortgage, including selling and downsizing or renting, or borrowing through a HELOC, a mortgage or a personal loan ^[1]. See our guides to reverse mortgage vs downsizing and reverse mortgage vs HELOC. FCAC also notes a reverse mortgage may limit other financing secured by your home, and you may need to pay off existing loans or lines of credit secured by it ^[1].

Step by step: how to approach it in BC

1. List what the money is for (taxes, repairs, care, debts) and how much you need.
2. Check deferment eligibility on the Province's page, including the equity rule.
3. Get a reverse mortgage quote that shows the rate, fees and how you would receive the money.
4. Talk to family and get independent legal advice. FCAC says some provinces require it and that you may wish to get it in any case ^[1].
5. Decide whether to use one tool or both, in the right order.

A reverse mortgage in BC and the property tax deferment program can each help, and they both draw on your equity. Know what you need the money for, check how they interact, and bring your family and an independent lawyer into the decision.

This article is for general information only and isn't financial, legal or tax advice. Rates, products and terms change without notice and are available on approved credit (OAC). The rate and terms you qualify for depend on your individual financial situation, including credit, income, property and loan-to-value. "Best rates" means the most suitable options available for your situation, not a guarantee of the lowest rate. Examples are for illustration only, as of November 14, 2026, and are not an offer. 8Twelve Mortgage arranges mortgages through 65+ lenders and does not lend directly. Licensed across Canada — see our licences.

Reverse mortgage facts (55%, repayment triggers, OAS/GIS) are from FCAC; the deferment rules (25% equity, compound interest from 2026) are from the Province of BC; both were checked on November 14, 2026 and can change. Reverse mortgage interest accrues and reduces your home equity over time. We recommend involving family and obtaining independent legal advice. The example uses assumed amounts.