Beyonce and Jay Z recently acquired this $200 million residence in Malibu, paying entirely in cash. Even for this affluent duo, possessing $200 million in ready cash might be a daunting task. It is speculated that they accumulated the necessary funds through a specific method, which can be emulated on a smaller scale.

Step #1-Take Out an Asset-Based Loan

They reportedly initially took out an Asset-Based Loan, rather than liquidating assets from their portfolio to avoid heavy tax consequences. This loan, backed by their portfolio, was used for the cash purchase of the property.

Step #2-Do a Cash Out Refinance

They then would have the option to do a Cash Out Refinance on the property to establish a conventional mortgage, using the funds from the refinance to clear the asset-based loan.

Even though they would have needed to deal with fees and interest for the asset-based loan and the refinancing, they gained tax advantages by not having to liquidate any securities from their portfolio, thereby avoiding hefty tax payments. In addition, they likely negotiated a discount on the property's price for making an immediate all-cash offer. If they just got a 10% discount, that would mean $20 million saving on the purchase.

This strategy is flexible and can be applied to purchases of various sizes without necessitating income, employment, or good credit standing. The strategy can work for a $200 million dollar purchase or a $200,000 purchase.