Finance
Michigan's homestead exemption primarily protects homeowners from:
AIncreases in property tax assessed value above the rate of inflation (Proposal A)✓ Correct
BForeclosure by a first mortgage holder
CMechanic's liens
DEnvironmental cleanup liabilities
Explanation
Michigan's Proposal A (1994) caps annual increases in taxable value for a homestead (principal residence) at the lesser of 5% or the rate of inflation, protecting owner-occupants from rapid tax increases.
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