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But is the cost of a house significant to someone worth billions? I'm asking why he wouldn't just pay cash for it.
by artursapek 10y ago
But is the cost of a house significant to someone worth billions? I'm asking why he wouldn't just pay cash for it.
- ceejayoz 10y agoThere's a saying along the lines of "You don't get rich by spending money" that applies here. A mortgage at 1.05% interest as mentioned in the article is basically throwing money at the person taking the mortgage.
- artursapek 10y agoMakes sense, thanks.
- deleted 10y ago[deleted]
- raincom 10y agoBillionaires' finances are managed by accountants, money managers, and lawyers. So, the accountant in this case suggests what's best: tax write off (interest expense), and interest rate differential (higher returns elsewhere - mortgage rate).
- edoceo 10y agoTime-value of money. Keep cash in YOUR pocket.
- twblalock 10y agoHow would he get that cash? If he has to sell stocks, his capital gains taxes would probably cost him a lot more money than the interest on a mortgage, or on a pledge asset line of credit with his investments as collateral. If you have to sell stocks to pay cash for a home, a mortgage could cost you less money overall.