Great post and most of us are likely guilty as charged, although not quite as bad as years ago! Well, we learned from the best. I recall Warren waited patiently for a great deal before closing on his second home in Laguna Beach & stretched and refi’d his 30 year mortgage as long as he could to optimize his birds in the bush. I suppose every compounded dollar counts.

totalexpert.com - What does warren buffet think about year mortgages

“Buffet was talking real estate because he recently put the Laguna Beach home he bought for $150,000 in 1971 on the market for $11 million. The $150,000 price tag was pretty steep in 1971 – it would translate to about $900,000 in today’s dollars – and Buffet took out a mortgage to buy it. 

Buffet explained that he took out a mortgage for about $120,000 to buy the home and spent that same amount in cash to buy Berkshire Hathaway stock. If he gets close to his $11 million list price, Buffet will make nearly seventy times what he spent for the Laguna Beach house. But more importantly, his decision to get a mortgage and use his cash differently, paid off even bigger.  

Here’s what Buffet told CNBC: ”I thought I could probably do better with the money than have it be an all equity purchase of the house. I might have bought 3,000 shares of Berkshire or something like that… so that’s [worth] $750 million [today].”