Elon Musk always thinks big when it comes to cars, tunnels, and rockets. This applies to his household finances too.
Rumors are the billionaire recently took out around $61 million in mortgages on five of his properties in California. Out of the five properties, four lie in the Bel Air neighborhood of Los Angeles and one is in the Bay Area of Hillsborough. The loans signed by Morgan Stanley in the last days of 2018 represent $50 million added to the previous borrowing. He refinanced a more 20,200 square-foot property that he had bought in 2012. This refinancing turned a $10 million loan into a debt of $19.5 million.
The wealthiest people even take loans by using mortgages to maintain liquidity of their money. According to the Bloomberg Billionaires Index, Elon Musk with a fortune of $23.4 million is listed among the ultra-wealthy property owners. The list here includes the Facebook owner Mark Zuckerberg, Beyonce, Ken Griffin and Jay-Z who too have taken out monster mortgages. The founder of Citadel, Ken Griffin stands out from the rest with two mortgages secured in the year 2016 for a total amount of about $144 million.
There are no shreds of evidence to manifest this rumor as representatives of the billionaire at Tesla did not respond to any emails seeking comments. A spokesperson at Morgan Stanley also declined to comment on this piece of information.
Once the loan amount exceeds $484,350 it falls under jumbo category; a policy that applies across most of the US. According to the wealth-management operation catering to ultra-high-net-worth clients, the loans that range from $2 million to $2.5 million falls under the category of super jumbo loans.
Michael Blum, the group managing director and head of the banking group at UBS Wealth Management USA said loans over $10 million as are received by appointment.
In recent years Elon Musk obtained personal loans by using his shares of Tesla Inc. At the end of 2017, 40-percent of his shares in the electric carmaker were pledged for loans benefitting his personal interests. A person with knowledge on this particular matter had tipped that Musk was inquiring about a personal loan with a bank last year in exchange for his stakes in rocket company SpaceX.
The 47-year-old billionaire has repeatedly gone to the market to buy the carmaker’s stock instead of receiving his salary from Tesla. It is his way of showing confidence towards the company, which though has never turned into an annual profit.