The property tax authority in Ann Arbor, Michigan, said that Federal Reserve Governor Lisa Cook hasn’t broken rules for tax breaks on a home there that Cook declared her primary residence.
The finding, which came in response to a Reuters request that the city review Cook’s property records, could boost Cook’s defense against efforts by the Trump administration to remove her from the Federal Reserve board.
Ann Arbor has “no reason to believe” that Cook violated property tax rules, City Assessor Jerry Markey told Reuters. Cook has at times lived elsewhere and city records indicate she sought permission from Ann Arbor authorities to rent out the Michigan home on a short-term basis.
Temporary absence from the home or renting it out short-term wouldn’t disqualify her from a tax exemption in Ann Arbor, the tax official said. “Living elsewhere temporarily does not necessarily make an owner ineligible for a principal residence exemption,” said Markey.
The official’s remarks come as the administration of President Donald Trump is accusing the Fed governor of fraud related to mortgages on the Ann Arbor home and another she purchased in Atlanta. Bill Pulte, the director of the Federal Housing Finance Agency, has spearheaded the effort, denouncing Cook on social media and referring the matter to the Department of Justice, which launched an investigation.
At issue is whether Cook, whom Trump has sought to fire from the Fed board, lied to her lenders when obtaining the two mortgages. The Trump administration, citing her mortgage contracts, has alleged that she improperly told both lenders that the loan was for a primary residence. By declaring a home as a primary residence, a homeowner can – but doesn’t always – secure a better interest rate on the loan and, separately, can receive discounts from local authorities on property taxes.
An appeals court was expected to rule Monday on whether Cook can continue in her job while litigation over Trump’s attempt to fire her is pending. However the court rules, an immediate appeal to the Supreme Court is expected, adding a further complication to her status for the Fed’s upcoming two-day gathering.
Reuters last week reported that Cook, according to a loan estimate for the mortgage in Atlanta, had informed her lender that the property would be a “vacation home,” not a primary residence . In a social media post after the news agency’s story, Pulte wrote that a “vacation home” claim in the Atlanta mortgage paperwork could still be fraudulent if she eventually secured the loan by declaring otherwise.
“That is extremely concerning,” Pulte wrote on X, “and in my opinion, evidences further intent to defraud.”
The full extent of Cook’s representations to her lenders remains unclear, including any paperwork that may have changed the “vacation home” characterization by the time the mortgage was settled. Local officials in Georgia told Reuters that Cook never declared the home as a primary residence for tax purposes there.
Cook has repeatedly denied any wrongdoing. In a written statement on Monday, her attorneys said: “The attempt to remove Governor Cook is based on cherry-picked social media posts from the FHFA Director that collapse under basic scrutiny.”
Since securing a mortgage for the Michigan home in 2021, local property records show she got approval from the city to rent it out on a short-term basis in October 2022 and again in April 2024. Some cities, like Ann Arbor, require home owners to obtain a license to rent out their home, even on a short-term basis.
In April 2025, months before Pulte began publicly accusing her of fraud, Cook sought approval to list the home as a long-term rental, according to local records and city officials. In July, she told the city she had enlisted a rental firm to manage the property, the officials said.
Cook now has until the end of the year to revoke the tax exemption on the home, said Markey, the Ann Arbor city assessor.
The property tax records in both states, along with Cook’s “vacation home” disclosure in Atlanta, could be considered strong factors in her defense, real estate and legal experts said. For any conviction of mortgage fraud, which is rarely pursued as a criminal offense in the United States, they said prosecutors would have to show she deliberately sought to deceive her lenders.
Paul Pelletier, a Washington-based former federal prosecutor who targeted bank fraud, said the Justice Department historically would only pursue cases in which a financial institution suffered significant loss. “This would never have crossed my desk, let alone be prosecuted,” he said, regarding the accusations against Cook so far.
The rates on Cook’s two mortgages show Cook didn’t enjoy discounts compared with prevailing rates available to borrowers when she negotiated the loans in 2021.
Her rate on the 15-year loan on the Michigan property was 2.875%, versus a prevailing national rate in that period ranging from 2.23% to 2.45%, according to Freddie Mac data. And her rate on the 30-year loan on her Atlanta property was 3.25%, versus a prevailing rate at the time ranging from 2.93% to 3.04%, according to Freddie Mac data.
