(Newser)
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The mortgage on Mark Zuckerberg's new $5.95 million abode brings whole new meaning to the term, "1%." For starters, that's roughly the rate Zuckerberg is paying—it's adjustable rate, but it's starting at just 1.05%. It's also the kind of loan that only the wealthiest 1% of Americans could get, Bloomberg observes. While rates are near record lows for everyone, the average 30-year fixed rate is more than three times that, at 3.56%.
"When you can borrow at a rate below inflation, you’re borrowing for free," explains one financial analyst. "This is the concept of using other people's money." That's why so many billionaires borrow—they can get exceedingly favorable terms. "Even if someone would be able to pay off that mortgage with cash … they don't want to tie up their holdings," one banker explains. Zuckerberg's wealth also lets him roll the dice with an adjustable-rate—something reserved for "people who are millionaires, at least," another analyst tells the Christian Science Monitor.
