The part nobody warns you about

Why your Michigan mortgage payment jumps in year two

Uncapping doesn't just raise your tax bill — it drains your escrow account. Most lenders set escrow from the seller's old capped bill, which is underfunded the moment the value uncaps. A year later you get a shortage notice and a payment increase in the same envelope. Here's your number.

Buyer Tool

Escrow shortage & payment shock calculator

Built on the official 2025 state millage rates for all 236 Southeast Michigan municipalities. Assumes a homestead (primary residence) rate.

Auto-filled from the official 2025 state report.
On the listing or the assessor's site. Not the same as market value or SEV.
Most do the first, and it isn't technically wrong — your first-year bill really is the seller's capped amount. It just guarantees a shortage the following year unless someone plans for it.
Your year-two payment increase
Escrowed monthly, year 1
What it needs to be
Underfunded each month by
Shortage after 12 months
Cushion top-up (2 months)
Year 1 escrow portion
Year 2 — higher bill
Year 2 — shortage repayment
Year 3 onward
Why it's a double hit: at the escrow analysis your servicer raises the monthly payment to cover the higher ongoing bill and spreads the accumulated shortage over the next 12 months. Year two carries both. Year three drops back to just the higher bill.

Get ahead of the shortage

We'll put the uncapped figure in writing before you close, so whoever handles your loan can set escrow on the right number from day one.

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