The Rich Get Richer: Facebook CEO Mark Zuckerberg Refinances Mortgage At Great Rate

By David Cohen 

Facebook Co-Founder and CEO Mark Zuckerberg is pretty smart when it comes to real estate, as well, refinancing the mortgage on his home in Palo Alto, Calif., with a 30-year adjustable-rate loan starting at 1.05 percent, according to reports.

Bloomberg reported the refinancing of the property, which Redfin described as a five-bedroom, five-and-one-half bath house, built in 1903, on a 9,011-square-foot lot, ensconced behind a gated drive.

Redfin added that homes in the 94301 ZIP code sold for a median $1.875 million, or $968 per square foot, in June, mentioning that Zuckerberg’s ZIP code neighbors include Google Co-Founder Larry Page and late Apple Founder Steve Jobs.

Bankrate Senior Financial Analyst Greg McBride told Bloomberg the refinancing was a sound move by Zuckerberg, saying that the rates available to individuals with high net worth (Zuckerberg’s $15.7 billion certainly qualifies) are lower if those individuals are willing to bear the risk of monthly interest rate adjustments, and adding that after the Federal Reserve declared that it would keep interest rates near zero for at least two years, large spikes are unlikely in the near term. He told Bloomberg:

When you can borrow at a rate below inflation, you’re borrowing for free. This is the concept of using other people’s money, and it preserves financial flexibility for the borrower.

Facebook Spokesman Larry Yu would not comment to Bloomberg on Zuckerberg’s mortgage, saying in an email:

We’re not going to get into the personal finances of executives.

Readers: Do you agree that the refinancing was a sound move by Zuckerberg?

Image courtesy of Shutterstock.