Texas Attorney General Ken Paxton finds himself at the center of a controversy involving alleged inaccuracies in mortgage documents that may have afforded him and his wife, Angela, significant financial benefits.
The couple, long-time residents of a $1.5 million house in a gated community outside Dallas, purchased additional properties in Austin, raising questions about the legitimacy of their mortgage filings.
An investigation by the Associated Press revealed that the Paxtons secured mortgages for three homes while inaccurately designating each as their primary residence.
This misrepresentation allowed them to secure lower interest rates, which legal experts estimate could save them tens of thousands of dollars in mortgage payments over the life of the loans.
Further scrutiny revealed that the Paxtons also unlawfully collected homestead tax breaks for two of their properties, circumventing the legal restrictions against receiving such benefits for multiple homes.
Both federal and state laws impose strict penalties for knowingly falsifying information on mortgage applications, and in Texas, obtaining homestead tax benefits on more than one property is illegal.
Violating mortgage terms could permit lenders to require full repayment, according to legal experts.
The implications of these mortgage revelations are significant, particularly as Paxton campaigns for a U.S. Senate seat, challenging incumbent John Cornyn in the Republican primary.
This situation is further complicated by the Trump administration’s ongoing criminal investigations concerning similar allegations against political opponents.
President Donald Trump has accused Democratic figures, including Senator Adam Schiff of California and New York Attorney General Letitia James, of engaging in mortgage fraud, though the nature of their cases is considered less severe under the law.
Paxton has previously commented on the investigation of James, expressing hope that any wrongdoing would be met with accountability.
As the legal landscape evolves, the Justice Department has initiated a criminal inquiry into James and received a referral to investigate Schiff.
However, there has been no indication of a similar investigation into Paxton at this time.
Despite his status as a prominent Trump ally, it seems unlikely that Paxton will face federal scrutiny akin to that faced by James and Schiff, due to his position as Texas Attorney General and the fact that his office is responsible for investigating mortgage fraud allegations in the state.
The details surrounding the Paxtons’ real estate dealings are particularly striking, as they hold mortgages on three distinct properties, including one in suburban Dallas and two in Austin, all of which are fraudulently claimed as primary residences.
The financial implications of this designation are considerable; primary residences typically qualify for significantly lower interest rates than investment properties, translating to substantial savings for homeowners.
Legal experts suggest that establishing intent in Paxton’s case may hinge on whether he knew about the contents of the mortgage documents when he signed them, a point that is crucial in determining culpability.
It has been suggested that the Paxtons may not have carefully reviewed the documents prior to signing, although as the chief law enforcement officer in Texas, Paxton is held to a higher standard of accountability, particularly regarding legal and ethical obligations.
Additional concerns arise from the Paxtons’ collection of simultaneous homestead tax breaks, which raises questions about their compliance with tax laws.
In 2018, they reportedly received homestead property tax breaks on their Dallas home and a $1.1 million home in Austin, violating legal stipulations that permit such benefits on only one primary residence.
The suburban Dallas home, where the Paxtons have long lived, is registered as their voting address and falls within the legislative district represented by Angela Paxton, adding to the complications of their case.
Experts indicate that filing for two homestead tax exemptions is a clear violation, as taxpayers must proactively apply for the tax break, which constitutes an intentional act and suggests knowledge of the law.
The motivation behind these actions has puzzled many, considering Ken Paxton’s role as Attorney General, which inherently carries a duty to uphold the rule of law.
In addition to the mortgage and tax irregularities, evidence has emerged that the Paxtons may have breached the terms of other mortgages by renting out properties contrary to stipulations that restrict such actions.
Records indicate that a home in College Station, Texas, was not to be rented out as per the mortgage agreement; however, it has been advertised for rent since at least 2022.
Furthermore, a luxury property in Broken Bow, Oklahoma, also owned by Paxton, has been listed on Airbnb and other short-term rental platforms despite mortgage terms explicitly forbidding rental activities.
Efforts to obtain comments from the lending institutions involved in these transactions were unsuccessful, raising further questions about the scrutiny directed at the Paxton properties.
While the investigations into the Paxtons’ mortgages and tax filings are ongoing, comparisons have been drawn with the cases of James and Schiff.
James is under investigation for discrepancies in forms pertaining to a property purchase, where she initially declared the intention to occupy the home as her primary residence, a claim contradicted by other documentation.
Schiff, for his part, previously held properties in Maryland and California each designated as a primary residence until making changes to his claims in a 2020 filing.
Unlike Paxton, whose accusations are more direct and involve repeated infractions, both Schiff and James maintain that their statements and actions have not violated laws in a similar manner.
The development of these allegations comes amid an already tumultuous legal and political landscape for Ken Paxton, marked by prior controversies during his tenure.
Before his election as attorney general, Paxton faced legal challenges when he admitted to violating Texas securities laws in 2014, which necessitated a fine.
He has since navigated a protracted legal battle involving securities charges that lingered for nearly a decade but were ultimately dropped in 2024.
Additionally, Paxton’s impeachment by the Texas GOP-controlled House in 2023 and subsequent acquittal in the Senate further exemplifies the challenges he faces in maintaining his position amid ongoing scrutiny.
In a personal development, Angela Paxton recently filed for divorce, citing infidelity and other undisclosed concerns as reasons for their separation.
This personal turmoil coincides with the ongoing scrutiny of Ken Paxton’s professional conduct, which reached its height due to his connections with real estate developer Nate Paul, who recently pleaded guilty to making a false statement to a financial institution.
During the course of their investigation, it was revealed that several top aides in Paxton’s office had raised alarms to the FBI about potential misconduct concerning his interactions with Paul and allegations of improper favoritism.
Ultimately, the combination of personal and professional challenges makes the upcoming political landscape uncertain for Ken Paxton, as increasing scrutiny intensifies over his financial dealings and legal responsibilities as Texas Attorney General.
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