The Chron has a long and thorough story on the financial woes of Supreme Court Justice David Medina, who may or may not face arson-related charges from the Harris County DA's office some day. It bolsters the existing yet entirely circumstantial case that Medina and/or his wife may have caused the fire that destroyed their house, but it leaves a big question that so far has not been explored, and raises another question that perhaps should be explored in more depth.
On the first item:
Long before his home burned, Medina had used it as a source of ready cash. Assisted by a mortgage company whose name became synonymous with the excesses of the subprime lending frenzy, he took advantage of a rising market to draw every dollar of available equity from his house, even though the result was increasing monthly payments that may have played a role in a 2006 attempt to foreclose on the property.
Over a five-year period, Medina and his wife, Francisca, took out three high-interest, adjustable rate home equity loans amounting to most, if not all, of the entire official appraised value of the property. The loans were made through Ameriquest Mortgage Company, a controversial lender, now defunct, that was the target of lawsuits and attorney general probes alleging unscrupulous or predatory lending practices.
Medina's final loan translated into a monthly payment of $2,525, which was scheduled to begin adjusting upward in December 2005. He began to fall behind on payments in early 2006. The company that serviced the loan, WM Specialty Mortgage, did not receive a payment after February, according to the foreclosure lawsuit it filed in July of that year.
Medina, who earns $150,000 as a Supreme Court Justice, later blamed the missed payments on a "miscommunication" with his bank. He brought the home out of foreclosure in December 2006.
After refinancing for the last time -- and struggling to meet the higher note -- Medina began to look for other sources of money. He sold 110 acres of land in Gonzales County in 2004 and 2006. He reported selling both at a loss.
He also began to draw reimbursement from campaign funds for mileage driven between his Houston home and Austin. From 2005 through 2007, he collected almost $57,000. The Texas Ethics Commission has previously ruled that mileage reimbursement from campaign funds for commuting amounts to using that money for personal benefit, a violation of state law.
Yates has said that Medina received bad advice from an accountant indicating he could charge his campaign for commuting costs. He said the judge will repay the money he withdrew.