MARC SILVER | Buyer's Guide

Philadelphia Buyer's Guide

MARC SILVER m.silver@compass.com

M: 215.460.5376 O: 267.435..8015 1430 Walnut Street, 3rd Floor Philadelphia, PA 19102

$100+ Million 200+ 8 Years+ Closed Transactions Transactions Experience + 12 Years as an Investor The Silvertone Homes Team's mission is to help everyone find their place in the world. Marc Silver is an accomplished and results-driven real estate professional based in Philadelphia. With a deep-seated belief that success in business comes from building strong, lasting relationships with clients and colleagues, Marc has established himself as a top-producing realtor in the region. He is a skilled negotiator, and he is committed to delivering unparalleled service and support to his clients. Marc takes a relational approach, prioritizing the development of lifetime relationships over short-term gains. He believes that his success is not just measured by the number of homes he sells, but by the number of people he serves and the quality of the service he provides. With a keen understanding of the Philadelphia real estate market and a wealth of experience in the industry, Marc is the ideal partner for anyone looking to buy or sell a property in the area.

Meet the Team

MARC SILVER As a 25-year resident of Philadelphia and an alumnus of The University of The Arts, Marc has immersed himself in the arts and culture in Philadelphia and its many diverse and wonderful neighborhoods. While working as a music educator in the city's network of highly acclaimed private schools, he began investing in real estate to help meet long-term financial goals and support his songwriting career. After purchasing his first home in 2006 and becoming a resident in the burgeoning Fishtown neighborhood, Marc and his husband purchased several more investment properties, renovated and resold a home (flipped a property), and purchased their dream home, which they lovingly renovated and restored to its stunning original character. In 2016, Marc decided to take the leap of faith and begin his career as a Realtor®. Born in St. Louis to Philadelphians, Marc returned to Philadelphia in 1997. When not hawkishly keeping an eye on real estate trends, he hosts a writing group in his home, writes music for his band and film/television, and performs with his Americana and Bluegrass band. Otherwise, he can be found coaching other realtors, playing pickleball, and ultimate frisbee in the area's beloved Philadelphia Area Disc Alliance aka PADA.

SANDY HANG Sandy Hang is a licensed real estate professional with an insatiable drive for creativity, ambition, and artistic expression. Having resided in the vibrant city of Philadelphia for over two decades, Sandy has acquired a wealth of experience and knowledge about the local real estate market. As an integral member of Marc Silver's esteemed team, Sandy is responsible for spearheading efficient processes that enhance the real estate experience for both clients and team members. From executing client marketing plans to managing social media and enhancing client experience, Sandy brings her extra set of eyes, ears, and hands wherever needed to ensure maximum satisfaction. When not working tirelessly alongside Marc and the team, Sandy indulges in her passion for pet care and explores Philly's renowned culinary landscape, drawing inspiration from her Cambodian roots. She also enjoys watching anime and playing video games, finding joy and balance in the creative outlets that fuel her ambition and passion for life.

DIANE AGUILAR

Diane is a dynamic and versatile virtual assistant based in the Philippines, whose unique set of skills and creativity make her a valuable addition to Marc and Sandy's team. With a wealth of experience in media production and event planning, Diane has an innate talent for creating captivating marketing assets that effectively convey the essence of any property. She is a master of her craft, bringing her artistic vision and technical expertise to the table to produce content that resonates with clients and audiences alike.

JON MOLINA Jon has been with COMPASS for a little over two years with a background in Customer support and technology. Prior to COMPASS, Jon worked at Apple for a number of years. Although he is originally from the Washington DC area, he has now resided in Philly for 4 years. As an Agent Experience Manager, his job is to make sure that the team has the tools they need to best service their clients!

CATHY VANDENBRAAK

Cathy Vandenbraak is a title processor and conveyancer for SQS Square Settlements. Cathy has been in title for 2 years and processes both NJ and PA files. Prior to title Cathy worked in commercial lending for 8 years. Cathy is currently studying to earn her PA/NJ Title Agent license. Cathy is inspired daily by her husband and their two sons. In her free time, Cathy likes to spend time with her family, hike, and play cards.

TOBY BJORMAN Toby first started his career in title in Center City Philadelphia in 2008. Over the last 15 years, he has worked in every role in a title agency, managed two offices, and conducted thousands of successful settlements. He also worked as a real estate agent in Center City, which gives him a unique perspective into an agent’s needs and a better understanding of the responsibility entrusted when a client is referred to him for title insurance. In his spare time, he likes collecting vinyl records and spending time with his family.

How to Buy a Home:

Greater Philadelphia

Connect .

Visit properties .

Execute Agreement of Sale and Make Deposit .

Your agent will guide and instruct you during viewings and open houses spanning a range of areas and property types. Now is the time to consider your ideal’s homes accessibility and amenities.

Reach out to a Compass agent, a licensed real estate professional. I will work as your advocate and trusted advisor to help guide your search.

After all negotiations are finished, you and the Seller will sign off on the agreement of sale and you will have an executed agreement of sale. You will submit a deposit to secure the home that is protected by the contingencies in the agreement of sale.

Get pre - approved .

Make an offer .

Home Inspections

Before beginning your search, your first step is to get pre- approved for a mortgage loan (unless you will be paying in cash for the purchase of your home). Your CØMPASS agent can connect you to a proven mortgage broker who will offer competitive interest rates and desirable financing packages and options. Based on your income and credit history, the mortgage broker will determine how much the bank will lend you, which will help determine the price range for your search.

Once you have seen a home you like, you submit an “offer,” which outlines the price, terms, and timing of the purchase. Your agent will provide advice on pricing, and guide you through the competitive process.

You and your agent will schedule applicable inspections on the property. Within the time frames provided by the agreement of sale, you will either accept the property as is; negotiate for credits or repairs, or cancel the deal and get your deposit back.

Title Search & Policy

Settlement & Transfer of Ownership

Review Building Financials and Regulations ( only for HOAs ) .

The title company will search and confirm there are no liens or judgements on the property and provide a clean title insurance policy.

On the day of closing, you and the seller will sign off on all deed, title and mortgage documents and the ownership of the property will transfer to you.

If you are buying a condo or townhome, you will need to review the rules, regulations, and financials for the association and be sure there are no issues or concerns.

11 Scheduled Settlement

Complete Loan Application .

Closing

Congratulations! You are a now a home owner!

The bank will organize the appraisal, search the title and finalize the paperwork so your loan is “clear to close.”

Acquire Homeowner Insurance .

Final Walk - Through With Your Agent .

Be sure to contact your home owners insurance company to line up your policy well before closing.

A review of the property to confirm that it is in the same physical condition as when you signed the purchase and sale agreement.

Table of Contents

1 Financing Your Home Loan Programs and PITI Tax Information 2 Building Your Team Finding the Right Match Condos, Co-Ops, or Townhouses? 3

Do I Really Need a Realtor When Buying a Home? Selecting a Lender

Breaking Down Your Online Home Search Selecting a Neighborhood

4 5

Preparing to Write the Offer

Final Thoughts

To Buy or Not to Buy By Marc Silver

Over the years, we’ve had many clients who wanted to buy a house. They were well-qualified and prospective homeowners, but they couldn’t pull the trigger. Sometimes it was with good reason: they had an unstable job, were likely to transfer out of the area, or simply decided that in order to buy, they might have to sacrifice their ideal location and lifestyle to make it work. While all concerns are valid when you’re making a big financial purchase or life change, it’s important to remember that buying a home doesn’t define or limit you. It simply adds to your investment portfolio; it also gives you a bigger tax break when April 15th rolls around! Buying a home is a big decision and one that you should consider carefully. Be honest about why you’re having difficulty making a decision about buying. This is a large financial investment, one that pays off greatly over time for most people. It gives them a head start on their real estate investment portfolio; often times, the money they make on their first home pays for the downpayment of their move-up home. Time and time again, we’ve had clients that prove it makes great financial and personal sense to buy. If you’re qualified to purchase a home and are planning to live in the area for the next couple of years, it almost always makes financial sense to buy. In our office, we like to say nothing looks sexier on a person than real estate — and it’s true! In addition to a new sense of self-worth and accomplishment you’ll also have a fantastic new financial investment in your portfolio! Not to mention you can decorate and customize your new home however you want, now that you’re no longer renting. If you need help deciding if buying makes sense for you, don’t hesitate to reach out to us. We’re always happy to walk you through the process, no matter what stage of life you might be in.

Homeownership has long defined the American Dream. We recognize that it has become more challenging for many people (particularly young people and nascent buyers), to “buy in” to the American Dream of homeownership. Tighter lending restrictions and a difficult economy have presented challenges, especially here in Philadelphia where home prices can be higher than in other parts of the United States. But fear not, American ingenuity will always triumph and the news isn’t all bad. There are several loan programs available that will help you on your quest to homeownership. 01 PART Financing Your Home Loan Programs and the American Dream

Current Loan Programs

VA Loans | Minimum 0 % Down Payment

Adjustable - Rate Mortgages vs . Fixed - Rate Mortgages

The best opportunity is for our veterans. Our government thanks members of our armed forces by offering them VA loans. VA loans have become ever more popular with little or no down payment. Although once regarded negatively in the go-go seller’s market, we have more and more contracts than ever with VA financing and it is now one of the hottest ways to buy a home.

Another option that is regaining popularity is an adjustable rate mortgage, or ARM. With a traditional fixed-rate mortgage, you lock-in your interest rate for the life of the loan, typically either 15 years or 30 years. You are guaranteed that interest rate from now until the loan is paid off. However, with an ARM, you can get a lower interest rate than you would with a fixed-rate. The catch is that after a certain time — 5, 7, 10, or 15 years — your rate will adjust. After that time, your rate will either increase or decrease by a certain percentage (usually 1%), depending on current interest rates. If you are planning on being in the property a short time, an ARM is worth your consideration.

FHA Loans | Minimum 3 . 5 % Down Payment

FHA loans are another accessible program available to purchasers who are looking to buy a property. Under this program purchasers can put down as little as 3.5% of the sales price in a down payment for a loan up to $625,500.

Conventional Loans | Minimum 5 % Down Payment

The Bottom Line

Just remember: the American Dream is still possible. All it takes is doing a little research, financing smartly, finding the program that is right for you, and of course: having a great Realtor in your corner.

Lastly, buyers should still consider conventional financing, which is the most popular way to purchase a home. Typically these loans require a 5 to 20% down payment. However sometimes it can be less. The benefit of a conventional loan is that you’ll typically pay less mortgage insurance on your loan, which lowers your monthly mortgage payment by a few hundred dollars. Don’t forget: the higher your down payment, the lower your monthly mortgage will be, and the higher your equity will be in the home you own. So, if you can afford to make a higher down payment — go for it! How you structure your loan can also make a difference.

What is a PITI?

If you are in the market for a new home, you may hear and see the term PITI quite a lot, especially in the loan application process. PITI represents the four parts that make up your mortgage payment: principal, interest, taxes, and insurance. PITI is the dollar amount an underwriter factors into your monthly payments when determining how much home you can afford. Lenders like to see PITI less than or equal to 28% of a borrower’s gross monthly income (you may hear this term called a front-end ratio).

PRINCIPAL

Principal is the amount of your loan. You pay a portion of this principal with each mortgage payment. Typically, your principal payments are quite low initially as the majority of these initial payments is interest. This is a great tax benefit. Over time, you reduce the outstanding principal balance and your equity in the home increases. Paying down the principal is what reduces the overall balance of your loan. You can also make additional payments at any time towards paying down your principal.

Note:

INSURANCE

Interest only loans are also available. With such loans, principal payments don’t kick in until several years into the loan.

This insurance portion of PITI is your property or homeowners’ insurance. Homeowners’ insurance covers a wide range of possible issues, from water and fire damage to weather- related losses. It also covers your possessions (on that note, be sure to make an inventory of your valuables when packing to move). Also included in this portion is liability insurance, which would be used in the instance of an injury or accident. Be sure to shop around and get various quotes for homeowners’ insurance, as it is one area where you do have some control over costs. We recommend doing this before the end of your home inspection or condo/HOA review period in case the insurance on your future home is more than you anticipated. You may also hear the term private mortgage insurance or PMI. If you have put down less than 20% on your home, your lender will require PMI. This insurance protects your lender, should you become unable to pay your mortgage.

INTEREST

The interest is the percentage amount a lender charges you for borrowing the money to buy a home. Your initial mortgage payments will be mostly interest; however, this ratio will shift over time. If you have a fixed-rate mortgage, the rate you pay remains the same over the life of the loan. With an adjustable-rate mortgage (ARM), your rate will fluctuate with the interest rates in the broader economy.

TAXES

These taxes are those property taxes paid to the municipality in which you live (city, town, or county). They provide the funding for local schools, roads, and emergency services like the police and fire departments. Property taxes can vary widely within a metropolitan area, so always check what the tax rate is in the municipality you are targeting. When you are house hunting, you can find the current property taxes on the MLS listing sheet or your Lender’s Estimated Closing Costs, though these are always subject to change.

A FINAL NOTE

When comparing mortgage rates from different lenders, make sure the quoted payments represent the same costs.

The Top Tax Benefits of Home Ownership

Most people know that home ownership offers tremendous financial benefits. Your home is likely the biggest investment you will ever make! As such, it can significantly build your wealth over time. Making that monthly mortgage payment creates equity (vs. paying rent to build up your landlord’s equity).

Though real estate values may fluctuate, over the long haul, buying your home is always a solid investment.

Homeownership also serves as a good hedge against inflation. With a fixed-rate mortgage, you are guaranteed to pay that rate, despite what may happen to the economy. Even adjustable-rate mortgages (ARMs) cap how much and how often the interest rate and / or payments can vary in a year as well as through the entire mortgage period. Perhaps the most important financial advantage of home ownership is its tax benefits. To take advantage of them, however, you will need to itemize your deductions and consult with a financial professional or tax advisor (while we are not tax advisors ourselves, we will happily connect you with some excellent ones).

The Benefits

Mortgage Interest is a Tax Deduction

For example, suppose you are a single woman selling a condo you bought 10 years ago for $350,000. The closing price is $650,000. You spent $50,000 in fees, commissions, and getting the condo ready for sale. You may think you had maxed out your $250,000 shelter with the sales price, but with the closing and selling costs, you might owe no capital gains tax at all!

The best tax break of home ownership is being able to deduct your mortgage interest from your federal income tax return. You can deduct interest on up to $750,000 of your home mortgage amount. Remember, this is your home mortgage amount, not your purchase price. For the first few years you own your home, the interest portion of the payment is roughly 2⁄3 of your monthly mortgage, which can translate to a significant tax break and cut down on what you owe Uncle Sam every April. For example, if you have a $500,000, 30-year mortgage at a fixed rate of 5%, you will enjoy a tax savings of $7,376.84 in your first year (assuming you’re in the 25% tax bracket). Over the life of this loan, you will save (Need help calculating) in taxes!

Of course, you must meet certain conditions:

You have owned the home for at least two years in the five years before the sale. The home was your primary residence for a total of at least two years of that same period You did not exclude these gains from another home sale in the two years before the sale.

Capital Gains Protection

Tax law also allows you to shelter a large amount of profit you make when you are ready to sell your home. If you’re married and filing jointly, $500,000 of your capital gains is sheltered; $250,000 for single homeowners. FYI: Your gain is actually your home’s selling price, minus deductible closing costs, selling costs, and your tax basis in the property. Be sure to include the commission you pay, title insurance, any fees (legal, inspection, etc) and money spent prepping the house for sale when calculating your gain.

To use this exclusion again on another property, please check with a tax professional.

More Tax Breaks for Your Federal Return

Do you Pay PMI ? Deduct Those Premiums .

Points are Deductible , Too

For mortgages issued in 2007 or later, home buyers can deduct the premiums paid for PMI. If you have a mortgage but didn’t have a 20%+ down payment, your lender requires the mortgage be insured. Many lenders offer programs with just 10-15% down, so we see this scenario quite often. Yes, PMI is another cost, but the good news is that those premiums can be deducted, as long as your income is less than $100,000. FHA, VA, and the Rural Housing Service loans also require insurance. Some of those premiums are deductible as well. These loans are more complex, so plan to consult a professional to take advantage of these deductions.

Points (or discount points) are fees paid directly to the lender at closing in exchange for a reduced interest rate. A point is equal to 1% of the loan amount. For example, the value of a point on a $250,000 mortgage would be $2,500. The points paid to ensure a loan rate are tax deductible, as long as the you, the buyer, pay them (vs. the seller.) Also, the cash for your down payment must equal to any points paid. Be sure to deduct the points within the year that you bought the home.

Property Taxes : Also Deductible

Your annual property taxes are a deduction for as long as you own your home. These local taxes are based on the assessed value of your home. The more your home is worth, the higher your property tax bill. Fortunately, property taxes up to $10,000 are deductible from your federal income taxes. You will pay your taxes either through an escrow account with your lender or directly to the municipality. Check your records to determine this amount, and deduct away!

First - Time Buyer Special

First-time home buyers often tap into their IRAs for the down payment of their first home. Normally, the IRS charges a 10% penalty for preage 59 ½ withdrawals, but not in this case. Homebuyers can use up to $10,000 ($20,000 for a married couple) of IRA funds toward the purchase of a first home. The best news? You don’t have to be purchasing your very first home to take advantage of this option. Technically, as long as you (or your spouse) didn’t own a principal residence during the previous two years, you qualify. Feeling generous? You can take advantage of this option for a child, grandchild, or a parent. You must use these IRA funds within 120 days of withdrawal, so act quickly when using this option. Also, know that these funds will be taxed in your top bracket.

Save Those Hardware Store Receipts

Go Green and Save

Save receipts and records for all improvements you make to your home. A home improvement project is something that adds substantially to the value of your home, increases its useful life, or adapts it for new uses. Qualifying projects include additions, remodeled kitchens and bathrooms, decks and fencing, landscaping, electric and plumbing upgrades, and new roofs. While you can’t deduct these costs now, when you sell your home, they are added to the purchase price of your home. This new number is the cost basis of your home for tax purposes; in lay terms, it’s the amount of your investment in your home. The greater your basis, the less profit you’ll receive when you sell your home, which translates to a lower tax bill when you do sell (see capital gains section above).

Energy-saving home improvements can earn you an additional tax break in the form of an energy tax credit worth up to $500. A tax credit is more valuable than a tax deduction because a credit reduces your tax bill dollar-for-dollar. However, keep in mind this opportunity only applies to your primary residence.

The Bottom Line

Buying a home is almost always a wise financial decision. It offers tremendous financial benefits, most notably on the tax front. Contact us if you’d like to talk through your options. Due to the recent changes to the tax law, it is always best for you to discuss any tax issues with an accountant. We are happy to connect you with a tax professional who knows the ins and outs of real estate tax implications.

Many buyers are under the impression they don’t need to hire a Realtor when buying a home. While we have certainly come across many unrepresented buyers in our years of experience, we do not recommend this option. There are countless reasons why you want a seasoned Realtor in your corner when buying a home. 02 PART Building Your Own Team Do I Really Need a Realtor When Buying a Home?

Buying a home is a major life decision and also likely the biggest financial investment you will make in your life. You want someone experienced on your team guiding you through the process, which is full of major decisions and a multitude of details.

Realtors have access to homes you won’t find on Zillow or other real estate sites. There is a “coming soon” status in the MLS (the Realtor listing database that feeds to all of the popular search sites like Zillow and Redfin) that consumers can’t access. Agents have ways of finding homes that aren’t on the market but are available for sale. They have access to other agents’ private listings as well as connections with other agents and sellers.

The sales contract to buy or sell a house is a legally binding document. If something goes wrong, you could lose hundreds of thousands of dollars. An experienced Realtor will help explain all the ins and outs of the contract documents and ensure you navigate the contingencies correctly.

You don’t pay commission! Commission is paid by the seller to the seller’s agent, also known as the listing agent. The listing agent then offers compensation to the buyer’s agent when they list the home for sale in the MLS. So, the commission for both agents is paid by the seller. The only thing the buyer might pay is an administrative fee to your agent’s brokerage. This fees usually ranges from $500 to $1000 depending on the brokerage and is paid at closing as a part of your closing costs.

Because of how commission is structured (see above), you don’t save any money by buying without a Realtor. You cannot negotiate money back by using the listing agent. This is an urban legend! In fact, many buyers going at it alone end up leaving money on the table. If you have the right buyer agent representing you, you can negotiate a much better deal and terms that work in your favor.

The listing agent represents the seller and is working for the seller — not you. You need someone advocating for you. After all, you don’t know what you don’t know!

If you are buying new construction, you may be under the impression that the builder’s representative will take care of you. Not so! Read our related article to learn why it’s especially important to use a Realtor for a new construction purchase.

An Additional Note

Not all real estate agents are Realtors! A licensed Realtor is a member of the National Association of Realtors and legally bound to its Code of Ethics. A real estate agent without the Realtor designation is not bound to any such standards. Keep this in mind as you talk to various agents.

A good Realtor will look out for your best interests, knows how to negotiate, and can walk you through every step of the home-buying process.

Your Realtor can help you find an experienced lender so you can secure the necessary financing for your dream home. Realtors also have vast networks of professionals to recommend including home inspectors, contractors, movers, and much more. If Marc Silver and the Silvertone Homes team can help you in your home search, please reach out. Even if you’re not quite ready, we are always happy to talk through the process and your various options.

Starting the Conversation with a Lender - and What to Look For

When beginning the home-buying process, one of the first things you should do is contact a lender to get pre-qualified. It’s important to know what you qualify for and what you are comfortable spending per month before looking at properties. Often these numbers aren’t the same and a lender can explain the difference in detail. In brief, the number that you pre-qualify for might be a lot higher than what you can comfortably afford to pay each month. There is no fee associated with getting pre-qualified; you aren’t locked into a rate and you aren’t obligated to use the lender. It’s a win/win. We recommend that our clients do their due diligence and reach out to at least three lenders. It’s essential to select a lender you feel good about since you’ll be working closely together throughout the home-buying process.

Things to Look For in a Lender

Do they offer a variety of loans ?

Are they local ?

This variety is important if you need a creative loan. For instance, if you don’t have much cash on hand, want to buy before you sell, or have a high debt-to-income ratio, you’ll need a lender willing to work with those circumstances.

Believe it or not, a lender in a different time zone can cause problems. Lenders have to meet certain deadlines and if they are late, settlement can be delayed by several days. Imagine questions arising at settlement at 9am or 10am EST, and your lender on the west coast is not yet open for business. Your lender is responsible for choosing an appraiser and might think that Richmond is close enough to Alexandria to use an appraiser based there. Local lenders are more incentivized to do an excellent job for you and your Realtor: They live in the community and want to please the client and their agents so they will send referrals. A local lender can help give you an edge in a competitive bidding war if the other Realtor knows and trusts your lender.

Do you like their personality ?

You will be working closely with them, so make sure there’s a mutual connection.

Do they work on evenings and weekends ?

This is a biggie! When we find the house you love and want to write an offer, your lender must step in with a pre-approval letter for that property with the address, offer price, and down payment amount to submit with the offer. We work with you on evenings and weekends, and your lender should, too. Responsiveness is key!

What ’ s their reputation ?

Do they have in - house underwriting ?

Are they experienced? Do they have agents and clients who can vouch for them?

This is not a dealbreaker per se, but it can certainly be very important. Here’s why: Smaller banks are typically better in the lending world. Big banks like Bank of America and even some credit unions, can be very slow-moving. Small, local banks are much more agile, can make exceptions more easily, and typically know everyone they are dealing with throughout the process. At a larger bank, your lender might have underwriters in a different state.

Are they creative ?

Some lenders can easily identify ways to get you to qualify for a loan. For example, paying off one credit card and closing another improves your credit score and makes you more qualified for a loan. Creative lenders can open the door to lower mortgages.

Now that you’ve identified what to look for in a lender, how should you prepare for the call, meeting, or e-mail? How to Prepare 1 When you reach out to a lender, you will want to know how much cash you have for a down payment and closing costs, plus how much money you feel comfortable spending each month for a mortgage. 2 To get prequalified, you will not typically need full documentation on your income and employment history. You will need this information down the line, so it’s not a bad idea to start pulling these items together, such as tax returns, W2’s, etc — generally any documents that illustrate your earnings. 3 Be prepared that the lender will ask your permission to run your credit to get your credit score. Your credit score indicates what kind of interest rate you will receive. If you feel like you are months or even a year away from making a move, it’s never too early to reach out to prospective lenders. They can help you figure out how much you will need to save in order to afford the type of home you would like to buy. The best place to look for a lender is a referral from your Realtor or from a close, local friend who had a great experience working with one. The advantage of a Realtor’s recommendation is that instead of having dealt with them for one transaction, they have dealt with them for possibly hundreds of transactions and know their overall reputation in the industry. It is not legal for Realtors to get kick-backs for their recommendations, so you can rest assured that any recommendations are not to the advantage of your agent.

Zillow, Trulia, Realtor.com, Homes. com, brokerage websites… the options for your online home search are almost endless. It can be very overwhelming. Trying to decipher the descriptions can make it seem as if you’re reading a foreign language! We can help break it all down for you. 03 PART Finding the Right Match Breaking Down Your Online Home Search

The MLS Search The MLS (Multiple Listing Service) is the Realtor database where all properties for sale are initially entered and later syndicated to other websites. You will find both active properties and some coming soon properties on this site. For the coming soon properties listed on the MLS, although these properties are unable to be shown until they go active (which, at that time, will cause them to appear on other syndicated websites), you will have a heads up that the property will be coming available. We can get a date on the calendar for you to see it as soon as it’s live. The Silvertone Homes Team sets up an MLS search and/or a Compass search that is delivered to you — and to us —every morning (or however frequently you would like to receive the email) when a new or updated listing matches your criteria. Our buyer team will review your search daily and send any comments or suggestions we have about properties that are available. We’re also working in the background, networking with other agents and contacting past clients to see if we can find something that might work for you that’s not yet on the market. On the Compass platform, you will also have access to some Compass Private Exclusives or Compass Coming Soon properties that will not be visible on the MLS, or any other website for that matter! These properties are a huge advantage for working with our team as we have access to many properties that will never be visible to the general public. They are exclusive to agents and clients of Compass. These properties can typically be shown before they are on the MLS. If you are interested in one of these properties please let us know as soon as possible as many Compass Private Exclusives never make it to the open market!

If you find it easier to search on your own using third- party websites, such as Zillow and Trulia, that’s perfectly fine. However, please know that sometimes these websites have inaccurate information and therefore differ from direct-feed Realtor sites. Broker-operated sites and Realtor.com feature direct information pulled from the MLS, while on Trulia and Zillow rely only partially on MLS sites. They also receive information from syndication, meaning they aggregate information from a variety of websites and old listings. As a result, outdated properties appear on these sites. While they’re great for quick looks and basic statistics about communities and neighborhoods, they do not provide in-depth analysis and accurate listings.

How to Choose the Right Neighborhood For You Before launching your home search, think about what you really want in a neighborhood. You’ll likely have to make compromises! So, put the must-haves at the top of your list and the like- tohaves at the bottom. Here’s how to choose the right neighborhood:

Consider These Questions

What type of home do you want? Are you interested in a single-family home, townhouse, condo or co-op? Any particular style?

How far are you willing to commute? Up to 10 miles or no more than one hour? Be sure to factor in traffic!

In the Philadelphia area, a 20-mile commute can easily mean an hour in the car during rush hour, so we recommend testing your commute.

How do you plan to get around the community? Will you walk, bike, drive, take the bus or metro?

How important is walkability? Do you want to step outside your front door and walk a few blocks to restaurants and shops or are you OK with relying on a car, Uber or the metro? Does “walkable” to you mean restaurants at your doorstep, or within a mile? Do you prefer quiet, tree-lined streets or the hustle and bustle of a city? How important are sidewalks or a place to teach your kid how to ride a bike or drive? How about access to parks? Do you want to be in a historic neighborhood or a new development? Homes in historic neighborhoods have character but they often require work and sometimes come with strict guidelines for updates. Newer developments offer modern features with the option to customize your home (if you get in early enough in the process), but they can feel generic. Do you have children or plan to have them? You’ll want to do your research on schools as you are narrowing down neighborhoods. Even if you aren’t anticipating sending your children to public school, proximity to appealing school systems is still something to consider because living near them raises your property value.

Match Your Needs to Neighborhoods

Talk to your friends, family, and your Realtor about which neighborhoods fit the needs you identified. While Realtors can’t talk to you about some of these things, they can let you know which neighborhoods suit your needs once you’ve narrowed down the priorities. We often connect our clients with other clients and friends in the neighborhoods they’re considering so they can get the local flavor.

You can do this by tracking traffic during different times throughout the day. The easy way is to pull up Google Maps or Waze at different times and see how long it shows your commute Or you can physically get in the car, hop on the Metro, or ride your bike to test it. Check out the school and crime information. School finder: https://webapps1.philasd.org/school_f inder/ Crime Maps & Stats: https://www.phillypolice.com/crime- maps-stats

Do Your Due Dilligence

Once you’ve identified some neighborhoods that could be a fit, research the criteria that are most important to you to make sure it’s a match Drive through the neighborhood at different times of day. It’s not enough seeing the home on a Wednesday afternoon at 12pm. See what the neighborhood is like once school gets out, once people are home from work and once it gets dark. Visiting on the weekends usually gives you a good sense of the neighborhood vibe. When you drive through, consider: Are the homes in the neighborhood well-maintained?

Can you visualize yourself there?

Go for a walk and talk to neighbors; hear what they have to say.

Visit local restaurants and shops to envision yourself as part of the community

You’ll want to be sure you test your commute, after-school activities, or any other places you might find yourself going on a daily basis.

Breaking it Down: Condos, Townhouses, and Co-Ops

The type of home you choose when house-hunting for condos, townhouses and co-ops comes with considerations: what changes you can or cannot make to the home, rules and restrictions, and the amount of monthly fees you’ll be responsible for paying.

Condos

Co - Ops

Condo owners own “walls in,” meaning they own only the walls inside of the unit itself. All unit owners collectively own and share any common space (hallways, courtyards, etc.). However, it’s possible you will own the AC unit that sits outside of your unit. Window replacement depends on the condo association. Condos fees are typically higher than homeowner association (HOA) fees. Condo owners pay monthly for the maintenance of the property. The size of your unit usually corresponds to how much of the condo fee you pay and the percentage of votes you receive in the community. Your size represents the percentage of the condo building you own. Condo owners can customize their unit; however, be sure to review the condo documents carefully if you are thinking of moving walls or making major changes.

Co-ops are a totally different form of ownership. Think of co-op ownership much like buying shares in a corporation. The co-op corporation owns the building and the land on which it sits. Instead of buying a unit, the buyer of a co-op is buying shares in the cooperation. The cooperation then assigns the buyer the “right” to occupy a specific unit. Co-op ownership is considered personal property rather than real property. Co-op fees are generally higher than condo fees and usually include property taxes, building maintenance, and the underlying mortgage. Co-ops tend to have very strict rules regarding renting out the unit and bringing pets into the home. Co-ops often require higher down payments. Lastly, co-op boards vet all potential new owners, so be prepared to submit a lot of personal information and sit through an interview. Because of the type of ownership and the restrictions that come with co-ops, the prices tend to be a bit lower than condos. Co-ops can be harder to sell. Keep in mind that many lenders also do not offer loans for co-ops, so you would need to work with a lender that has been approved by the building.

Townhouses

Townhouse owners own the home itself and the land on which it is sited. In real estate lingo, this means it is owned “fee simple,” just like a detached house. Unlike a condo, townhouse

owners are responsible for all exterior maintenance, including the roof. Some

townhomes are a part of an HOA (usually this pertains to town-homes built after 1980). HOAs may have rules or restrictions about exterior paint colors, landscaping, and other aesthetics. HOA fees are typically much lower than condo fees since they don’t cover the same level of maintenance as a condo. Dues might be paid monthly, quarterly, or yearly depending on the association.

In our market, any offer for sale is made up of the basic body of the contract, any addenda or contingencies to the contract, plus any required disclosures. Here’s what you need to know to decode the real estate contract in Philadelphia. 04 PART Preparing to Write the Offer

Basic Terms in the Body of the Sales Contract

Price

Settlement Date

The most important part of every sales contract is the sales price. While all of the terms discussed below make up the full scope of the offer or real estate contract: money talks. Thus, price is the first thing buyers and sellers want to talk about.

Typically, settlement dates are anywhere from 30 to 60 days from contract date to closing, depending on the needs of the buyer or seller. For a vacant property, the seller will typically want to settle as soon as possible, which is around 30 days from the contract negotiation.

Closing Costs

Settlement Company

Some buyers also need help with closing costs from the seller. This is more common on properties under $700,000 and with FHA and VA loans. Whatever number you ask for in closing cost assistance is effectively deducted from the net proceeds to the seller. So an offer of $510,000 with $10K in closing costs assistance equals an offer to the seller of $500,000. If you don’t need it, we don’t recommend asking for closing cost assistance in a competitive situation. Closing costs can vary significantly depending on your situation. If you have any questions about closing costs, you should talk with a lender

In our market, the buyer has the right to select the title company. This is a non-negotiable portion of the contract.

Home Warranty

Buyers have the option of asking the sellers to provide a home warranty. Usually this request is made in older properties or where the purchaser is afraid an appliance or major system won’t last much longer. The cost is about $550 and the purchaser or seller is able to pay for this warranty. Again, this option can be negotiated, but in most cases, it isn’t used.

Down Payment Amount / Loan Type

There are various types of loans to choose from. You will need to discuss the type of loan and amount of down payment you qualify for with your lender

Condo / HOA Documents

For properties in a homeowners association or condo associations, this contingency is built in to the contract. Once you receive the condo/HOA documents for the association, you have five days to review them. If within those five days you find something in the rules or documents you don’t like (for example they have a regulation on renting out the unit, or they prohibit a certain type of pets that you own), you have the option to void the contract. However, that right automatically expires five calendar days after we receive the documents.

Earnest Money Check

When you write an offer, you need to submit an earnest money deposit (EMD) that will be held in escrow by the real estate brokerage company or settlement company. The check will remain in escrow until settlement, when it is credited back to you towards your closing costs or down payment.

Inspections

You and your agent will schedule applicable inspections on the property. Within the times frames provided by the agreement of sale, you will either accept the property as-is, negotiate for credits or repairs, or cancel the deal and get your deposit back.

Home Warranty

Condo / HOA Documents

Standard Contingencies and Terms

In addition to the main body of the contract, buyers can include addenda (typically made up of contingencies) to the contract. Just like any other term of the contract, contingencies can be negotiated between the buyer and seller. The major contingencies that are part of most contracts are the home inspection contingency (and radon contingency for homes with basements), appraisal contingency, and financing contingency; these are all very complex. There are also additional contingencies and clauses that can be part of a contract but are not as common as the other contingencies mentioned above. These contingencies are a good starting point for decoding the real estate contract— and what you need to consider before beginning the offer process. However, there are exceptions to every rule and many of these situations will vary if you’re in a competitive situation. This is yet another reason why having a great agent ony our side is critical! Keep in mind that real estate contracts are binding, legal documents and represent the largest financial investment you will likely make in your life — it’s serious stuff! Be sure to think through all the options carefully and discuss them with your agent and lender. The bottom line? Prepare as much as you can before you’re writing or reviewing a real estate contract. If you want to talk it through, our team is always here to help.

Ask us for our guide to multiple offers if you’d like to see the “kitchen sink” of strategies.

We know that buying a home is likely the biggest financial decision you will make in your life, and we are here to help. There is a lot of information to cover, and this is just the tip of the iceberg! We have helped thousands of buyers over the years and have a lot of insight into the process. We would love to get together over coffee and share our experience, answer any questions you may have, and walk you through the process. 05 PART Final Thoughts

Stay in touch!

Book an appointment with us online, text/call us, or drop us an email

M: 215.460.5376 O: 267.435.8015

Marc Silver

m.silver@compass.com silvertonehomes.com

@marcsilverphl

Client Success Stories "Marc is such a pleasure to work with! He helped us purchase our first investment rental property - he helped us select the perfect location and was great throughout the whole purchasing process. His communication is always excellent and timely (if not immediate!) and he continues to advise us on management of the property even after the sale. We loved working with him so much that we are using him again to list my mother's townhouse. He's done such a great job with the listing and showing of the house. I would not use anyone else. Thank you Marc!" Greg D . "I highly recommend Marc. He is diligent, savvy, and personable. My wife and I spent months looking for a home, both by ourselves and with other realtors, and it was a painful experience. Once we started working with Marc, we quickly and easily found a good fit (and closed the deal). It helped a lot that Marc was very accessible, walking us as first-time homebuyers through all the twists and turns of the process. Overall, a great experience!"

Matt L .

"Marc is amazing – he will go above and beyond for your needs as a homebuyer! Coming from out of state, my family needed a lot of navigation around the process and someone who could respond attentively to our concerns. He had our best interests at heart and made everything go smoothly. We will definitely go back to him for future properties!"

Tatiana L .

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