GOLDCOAST MORTGAGE SERVICE, Inc

 978-922-4446

 

Incorporated and Licensed in Massachusetts since 1999

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Home Buying Tips

Is Zillow “Instant Offer” Coming to Massachusetts?
by goldcoast on 
By John Donlon 

Boston's historic Beacon Hill offers a wide variety of homes and condominiums.A Realtor who enjoys our marketing perspective asked us recently, "Do you think the Zillow Instant Offer program will come to Massachusetts?"


The quick answer is “No”. The Zillow Instant Offer program is only being tested in depressed real estate markets in Orlando and Las Vegas. The program would never work in the red hot real estate market in Massachusetts.  


Instant Offer and other seemingly quick real estate transaction sites like Quicken’s "Rocket Mortgage" attempt to remove the service, consultancy, experience phase of a real estate project that Buyers Broker’s and GoldCoast clients receive for free. Some of our clients adamantly declare this aspect of our service saved them from making a retirement-delaying, quality-of-life altering mistake.


Instant Offer wouldn’t work in New England for many other reasons. Our topography, littered with granite droppings, results in home plots that are a lesson in geometry with everything from trapezoids to figure-8 shaped lots. Our homes range from Colonial Era construction into several periods and multiple design trends spanning centuries. As a result, it is common to find a first period farmhouse amidst a contemporary subdivision that contains wetlands.


Massachusetts homes are too wiggly to accurately predict value from an algorithm. Instant Offer needs a semi-homogenous product to work. Our subdivisions are built around rivers, train tracks, hills, some on top of hills. Stone walls and trees were commonly used to anchor metes and bounds. How do you accurately calculate square footage when there is boulder under half the house? Is a house in a historical district worth more, or less?  


Will some people flock to an easy solution – leaving money on the table and forgoing the big picture? Yes, but I challenge you with this: Were they the right customers for you in the first place; clients who understand and appreciate the value you bring to the project?  


Being in a professional service industry I recognize the importance of my role. Most of the Realtors and brokers I work with do so as well.


John Donlon is the Co‐Founder of GoldCoast Mortgage, Inc., one of the earliest licensed mortgage corporations in the nation. GoldCoast was founded, and fiercely protects, their extreme service model which puts the client’s needs ahead of corporate needs. In an age of technology based applications you will find their guidance, knowledge, and process very enlightening, comforting and efficient. GoldCoast Mortgage Service, Inc. agents are licensed and arrange residential and commercial mortgages in MA, NH and ME. 

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Home Purchase Checklist
by johnnyGCMS on 

By John Donlon

This is a non traditional checklist. One that you won’t see on any other website or real estate platform. It comes from the experience learned by our team from personally working on thousands of transactions over multiple decades. We are facilitators, and while licensed as (and only as) mortgage loan officers, we routinely help lubricate transactions across the finish line by sharing our intellectual property, knowledge and alerting our clients to “road hazards” along the home buying process. We call it, “Providing Safe Passage to a Real Estate Goal.”


We have only two things on our Home Purchase Checklist: WHY? and YOU.


YOU

Let’s talk about YOU first. YOU are the most important party in this transaction. Everyone else will fall behind you in the importance hierarchy. This house, home, or condo is your purchase.  You need to lead and control your goals and mission, otherwise someone else will. Your priorities come first; any vendor or service provider who attempts to put their priorities ahead of yours should be cut from your team. I need to apologize in advance to several sales people I’ve met over the years #sorrynotsorry.


It’s OK to be selfish. Defend your needs in the transaction. Allow NO questions to go without an answer that you are satisfied with. Are we good here? Let’s look at #2 now.


WHY?

Nobody want a mortgage – they really don’t. They don’t want 360 unrelenting payments and a quarter or half-million dollar burden. Being invoiced every 30 days without fail regardless of illness, job status, or economy. If given a choice most would opt for NO mortgage.


What our clients really want are things that only a home can provide. Stability, privacy, or a garage because you’re sick of scrapping windshields. The ability to host and cook for guests. To shorten up a commute instead of sacrificing 20+ days per year to the windshield gods. To be closer to your grandchildren, ski out your door and the list goes on. A mortgage is simply a tool to get to these things.


The first thing you will need to know (mostly about yourself) is WHY you are buying. Home buying being a huge sacrifice you need to know that the things you are about to sacrifice (money and time to name just two) are less important than the goal motivating you to purchase your home.


I like to start with a top 10 list of priorities. Where does homeownership fall on that list? Below health? Above retirement savings? Material items such as a house or a condo will not add or detract from relationships, but only magnify them. Are there right and wrong reasons to buy a home? Absolutely. Yet the bigger mistake is buying without a knowing the Why.


A home can enhance your quality of life, or it can eat you alive. If you don’t truly know why you’re purchasing the home, then it is apt to be the later. Start with the answer to the Why and you will change your entire homeownership experience. Then lean on your trusted advisors for the mechanical aspects of the checklist such as the smoke alarms certificates and final meter readings.


John Donlon is the Co‐Founder of GoldCoast Mortgage, Inc., one of the 70th earliest licensed mortgage corporations in the nation. They were founded, and fiercely protect, their extreme service model which puts the client’s needs ahead of corporate needs. In an age of technology based applications you will find their guidance, knowledge, and process very enlightening, comforting and efficient. GoldCoast Mortgage Service, Inc. is licensed and arranges residential and commercial mortgages in MA, NH and ME.

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Is waiving a home inspection financial suicide?
by johnnyGCMS on 

by John Donlon

In this molten real estate market, it's increasingly common for the seller to ask the buyer to waive the home inspection contingency. Is this financial suicide? This is not an easy question to answer.

New marketplaces call for new strategies. At GoldCoast Mortgage we know you need to live somewhere and buying a home comes with many risks. If your personality type cannot handle risk. The following strategy is probably not for you.


While any attorney might unilaterally say no to the waiver. We adopt a pragmatic approach.


We met Jay Mercier, one of the home inspectors we recommend, this week for coffee. He recently completed a post purchase inspection. The hardest of his life. He unearthed $35,000 in urgent repairs and devastated the home buying experience for a young couple. Most of the expense he could spot from the bottom step of the stairs down to the basement.


In a warm market, we've seen the home inspection used to renegotiate price. A broken dishwasher and ungrounded outlets used to mean a price reduction.


In a hot market, there are backup buyers ready to take your place. Renegotiation isn't an option but using our strategy at least you know not to buy a lemon.


In a molten market, buyer beware, the buying process is akin to an auction.


So, what can you do?


Train yourself as your own home inspector? This can be tough as laws and rules change. A successful inspector is an observant, experienced, investigator. We like service providers that have done thousands of inspections.


If you're forced to waive the inspection contingency in order to buy your dream home consider the following strategy:


A) Don't get set up. Homes that are fatally flawed tend to become blended into the crowd in a molten marketplace. This "slip it through" phenom is more likely in a For-Sale-By-Owner setting.


B) Don't ignore your instincts. Be wary of smells, taste of the tap water, recent renovations or fresh paint without expansion or improvement.


C) Consider a home inspector in tow. Schedule a meeting with a reputable home inspector, explain your dilemma and create a strategy. The strategy is you don't want to get roasted. Set your definition of roasted with the inspector. Is it a new roof, infestation, mold, asbestos, defunct furnace, structural integrity or failing chimneys? Then hire the home inspector to accompany you to the showing. A thumbs down means your definition of roasted is met. Thumbs up means "all clear" on major issues (no visible fatal flaws).


This strategy is not a home inspection; you're renting the inspectors experience. If you cannot handle the expense of smaller items or if you think $1,000 in inspector fees is expensive, this strategy is not for you. We use $1,000 as an example of needing to rent the inspectors experience more than once in the home buying process.


Home ownership and competitive buying represent risks. Do the best to minimize yours.


John Donlon is the Co‐Founder of GoldCoast Mortgage, one of the 70th earliest licensed mortgage corporations in the nation. They were founded, and fiercely protect, their extreme service model which puts the client’s needs ahead of corporate needs. In an age of technology based applications you will find their guidance, knowledge, and process very enlightening, comforting and efficient.


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Bi-Weekly Payment Plan - Valuable Financial Tool or Scam?
by johnnyGCMS on 

Before I answer that question it is useful to know how a Bi-Weekly Payment Plan (BWPP) works. The program base is contained in the difference between “Every-other-week” and “Twice-a-month”. Half payments made every other week add up to 13 full payments (26pays/2). If you paid your mortgage twice a month it would be a traditional 12 full payments (24pays/2).

 

The BWPP misconception is that the principal is applied with each half payment, it isn’t.

 

The BWPP now becomes a basic tool for overpaying your mortgage. Overpaying your mortgage is a complicated irreversible action that should NOT be done to the detriment of: rising credit card balances; ballooning HELOC’s, underfunded retirement planning, or educational goals. Seek competent guidance on this topic through your CPA and wealth manager.

 

Leading up to my answer please consider the following: BWPP does NOT magically re-amortize you mortgage every fortnight. It does not and CANNOT alter the terms of your mortgage contract.

 

Conditions of BWPP could include:

 ・ A setup fee (in the hundreds of dollars)
 ・ A transaction fee (cumulatively in the thousands of dollars)
 ・ The 3rd party servicer will need access to your check book
 ・ Payments will inevitable draft (now AHEAD of your typical schedule) on esoteric dates like the 5th of      May, Friday the 13th, Superbowl Sunday,  

    and Leap Day.
 ・ Consider the “Blue Moon Effect”: If your first payment is drafted on the 1st, 2nd or 3rd of the month it     is very likely that you will have 3 mortgage

    payments drafted that month.

 

So is it a scam?

 

If a product or service is designed solely for the benefit of the vendor and nothing is done to dispel “perceived benefits” which are false (re-applying principal every two weeks) and the ENTIRE service can be performed by the consumer free of charge, is that a scam? You decide. 

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This small seemingly innocent action can jeopardize your home buying experience.
by johnnyGCMS on 


Buyers wielding a 800+ FICO, twenty-percent down-payment, and powerful incomes are still vulnerable to this small initiative that's worked its way into the most utilized mortgage decision making algorithm in the world.

 

Most brokers, lenders, banks and credit unions utilize the services of either Fannie Mae's Desktop Underwriter or Freddie Mac's Loan Prospector for their guidance on backing or securing a mortgage application.

 

These systems known by their trade acronyms as DU and LP are statistically accurate and very finely tuned meters in assessing the likelihood of how a mortgage will perform in the future. The programs use hundreds of attributes to weigh strengths and weaknesses of a mortgage application and offer guidance in assessing risk.

 

Common attributes considered are:

  • Debt to Income ratio
  • Previous payment history on housing debt
  • Purpose of the loan
  • Amounts in savings (also called "reserves")

 

There is a little know "sleeper" in the process with can bring the entire home buying experience to a grinding halt. Some attributes are forgiving. For instance you can overpower some obstacle by increasing your down-payment (equity). Some Debt-to-Income ratio issues can be addressed by paying off debt at or before closing.

 

But one seemingly benign action could prove to be the ultimate Deposit-Grabbing, Moving-Van-Driver-Irate-Maker, Realtor tweaking, non-reversible action that you never saw coming ... even with all the First-Time-Home-Buying classes.

 

 Behold the "Disputed" Credit Item".

 

In existence for decades, the Disputed Credit Item has never been treated with much regard. After all, it's neither right nor wrong. It's disputed. It's neutral. it neither helps nor hurts.

 

Behemoth Bank error? Or Consumer oversight?

 

DU and LP take a grown up parental stance on this now - refusing to get involved. They isolate the dispute and identify it as neutral. But before they endorse the file (read: underwriting delay) they'll want the in-fighting solved. As in concluded.

 

One party must admit error or retract the dispute. Without doing so the process halts. With no workaround. Sound like an easy fix? Think about a Dispute on a credit trade for a company that is no longer operational. Credit bureaus while massively efficient in scale and also leaders in technology can be laboriously sloth like to fix a problem on a consumer account to which there are no means to track down the source.

 

Think twice about filing any Disputes as they can take on a life of their own. I write this with the utmost sincerity: Sometimes the Dispute is worse that the item you are disputing.

 

Prior to co-founding GoldCoast, John Donlon was a project manager for Equifax. His time spent at the bureau was very educational and insightful. Saving his borrowers heartache and costly problems is a top priority for him and GoldCoast Mortgage. Buying a home? Write to him for a list of $100,000 real estate mistakes that he has witnessed many times over.

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