|State Sen. Mee Moua lives darker side of American dream, loses her home|
As a policymaker, state Sen. Mee Moua schooled herself on the home foreclosure crisis that swept Minnesota and the nation.
As a resident, wife, mother and daughter, she's been living it for some time.
Almost a year ago, a Ramsey County sheriff's deputy drove up to an impressive house atop a hill on the eastern edge of St. Paul and handed Moua and her husband a notice of a sheriff's foreclosure sale on the home where they had lived with her parents since 2005.
Hundreds of thousands of dollars underwater and more than $18,000 behind on payments for an adjustable-rate mortgage, Moua said, she and her parents — who owned the home — tried to save it by making some payments and trying to negotiate with her lender. But no deal could be struck.
They moved out this year and are living with relatives across the street.
"It was very difficult," Moua said in an interview Thursday. "It's been a very hard year, like it is for everyone who's gone through this."
Moua, who was first elected in 2002, said her decision not to run for re-election this fall — news she delivered in a surprise announcement on the last day of the legislative session in May — had nothing to do with financial troubles.
"I don't think losing my home would have adversely affected my re-election," she said, emphasizing that her decision to step down from politics was based on a desire to spend more time with her three children.
She said the experience has made her a better lawmaker as she's supported homebuyer-assistance programs at the Capitol.
But she never referred to her situation in a floor speech, spoke of it to constituents or disclosed it publicly — not that she had to; there appear to be no rules that require any such reporting. She's never stopped living in her Senate district, so there's no obstacle to her serving out her term. Property tax payments on the house have remained up to date, records show.
While fragments of the story have been printed in public records for more than a year, few outside of her extended family and perhaps a few political confidants appear to have been aware of it.
Moua spoke to the Pioneer Press on Thursday after a reporter learned of the situation and requested an interview.
She said she hadn't spoken publicly about it out of respect for her family, whose personal finances are intertwined in the financing of the house.
The house where Moua lived was owned by her parents, who immigrated to the United States in 1978, when Moua was 5, in a story typical of legions of Hmong-Americans in the Minnesota.
The Moua tale diverges from the typical, perhaps, in the scale to which the extended family realized the American dream. In 2002, Moua became the first Hmong-American in the country to be elected to a state legislature.
In 2005, her parents bought the home on Oak Bluff Circle — a suburban-style cul-de-sac near South McKnight Road and Highwood Avenue — for $800,000, property records show.
With 5,032 square feet of finished space and a full second kitchen in the lower level, the freshly built stucco-and-stone house had ample room for Moua, her husband Yee Chang and their growing family.
"My husband and I didn't have the income for a house in that area, so my father said let's pool our resources so we can all live together," Moua said.
That same year, Moua's sister Vallay Varro, now a St. Paul school board member and Mayor Chris Coleman's policy director for education, and her husband bought a house for $650,000 across the street. And their brother and his wife bought a similar house on the same street, according to property records. With the prominent family occupying three houses, the cul-de-sac became affectionately known around St. Paul as the "Moua compound."
"It was my father's dream, and at the time, it was great," Moua said. "And we feel blessed we were able to spend all that time together. ... But for my family, I wouldn't be able to be in the Legislature or a parent or any of it. When the people of Senate District 67 elected me, they got my whole family."
As a state senator, Moua earns $31,140.90 in annual salary. Between 2007 and 2010, she received an average of nearly $20,000 in total per diem Senate payments each year, according to state records.
She stopped practicing law after entering the Senate. On her campaign disclosure forms, she reported earning income from an assisted-living facility she has an ownership stake in; she declined to say how much income, and that information isn't required.
The mortgage on the house where Moua and her husband, who is a real estate agent, lived with her parents was $640,000, with an adjustable interest rate over a 40-year term.
As is often the case with foreclosures, the question arises: How did you think you could afford it?
Moua responded: "I don't know all the details of the mortgage. Like a lot of other people, we went with the best mortgage that would get us into the house. Our plan was then we would refinance into a fixed-rate mortgage. Then the credit industry tightened up and we could never get refinancing. ... Hindsight, of course, is always 20-20."
Moua declined to discuss her parents' finances. Interpreting for them and then paraphrasing, she emphasized that the decision to buy the home — and to eventually enter into foreclosure — was theirs.
"It was their decision, and they want that clear," she said. "It's my job to support them."
Moua, whose name appears on no financial papers associated with the house, described her and her husband's financial and legal standing in the home as "in essence, tenants." The financing for the other two houses was also independent of her, she said, and they appear to be in good standing.
The same couldn't be said for the house of Moua's parents. Moua declined to discuss financial details, but she said the collapse of the real estate market hurt not only their home's value, but also the family income. "My husband was a Realtor," she said. "He's had to reinvent himself."
By September 2009, the house had fallen to below $500,000 in value, her parents owed more than $712,000 on the original mortgage, and they were more than $18,000 behind on payments, according to records filed with Ramsey County. JPMorgan Chase, the lender, began foreclosure actions.
Moua said they tried to sell the house in hopes of remaining there, but no deals panned out. By that point, "it made sense for my parents" to allow the home to fall into foreclosure, she said. "It was a calculation," she said. On Dec. 8, JPMorgan Chase bought the house at a sheriff's auction for $301,433 — a more than 60 percent fall in value from four years earlier.
After the six-month redemption period expired and they couldn't secure additional financing, they cleaned the house and moved in with Varro. As school opening approached, they decided to move into her brother's house. In July, the house was registered on St. Paul's vacant building list. On Thursday, a fragment of the telltale blue vacant placard remained, as did a combination lock fastened to the front doorknob.
On Aug. 10, when Moua cast her ballot in the Democratic-Farmer-Labor primary to narrow a crowded field vying to succeed her, she updated her voter registration information, changing just a few digits but ensuring her vote was legal, records show.
Around that time, the bank listed the house, and it sold. Last week, a "short sale" of $379,000 was finalized, according to a Multiple Listing Service entry. No transfers had been recorded as of Thursday in Ramsey County, and the selling agent did not return phone calls seeking comment.
Moua said the emotions of her and her parents — whom she said she is "protective" of — have evolved as they've seen their former house sit empty month after month.
"When it started, I was embarrassed, and I thought I would feel public shame," she said. "But I've come to terms with it, and I know I did my best."
Moua hasn't yet lined up a job for her post-Senate career, which begins Jan. 1, although she said "a couple of things are in process."
She might not stay in Minnesota, she said, but she wouldn't discuss specifics on what line of work she's eyeing — or where.
"I'm very optimistic about what the next decade will bring, if it's anything like the last."