Solicitation R-ATL-A4ACCHSNG0009.doc

PAGE

THIS CONTRACT IS A RATED)

ORDER UNDER DPAS (15 CFR 700)

OF

6. REQUISITION/PURCHASE NO

FORMCHECKBOX

NEGOTIATED (RFP)

U.S. Department Of Housing and Urban Dev

Southern Field Contracting Operations

40 Marietta St, 14th Floor

Atlanta, Georgia 30303 U.S. Department Of Housing and Urban Dev

Southern Field Contracting Operations

40 Marietta St, 14th Floor

Atlanta, Georgia 30303

NOTE: In sealed bid solicitations, “offer” and “Offeror” mean “bid” and “bidder”.

SOLICITATION

(Hour)

(Date)

CAUTION - LATE Submissions, Modifications, and Withdrawals: Section L, Provision No. 52.214-7 or 52.215-1.

All offers are subject to all terms and conditions contained in this solicitation.

11. TABLE OF CONTENTS

OTHER STATEMENTS OF OFFERORS

OFFER (Must be fully completed by offeror)

NOTE: Item 12 does not apply if the solicitation includes the provision at 52.214-16, Minimum Bid Acceptance Period

12. In compliance with the above, the undersigned agrees, if this offer is accepted within calendar days (60 calendar days unless a different period is inserted by the offeror) from the date for receipt of offers specified above, to furnish any or all items upon which prices are offered at the price set opposite each item, delivered at the designated point(s), within the time specified in the schedule.

13. DISCOUNT FOR PROMPT PAYMENT

(See Section I, Clause No. 52.232-8)

CALENDAR DAYS

20 CALENDAR DAYS

CALENDAR DAYS

CALENDAR DAYS

(The offeror acknowledges receipt of the amendments to the SOLICITATION for offerors and related documents numbered and dated:

15A.

NAME

CODE

FACILITY

16.

NAME AND TITLE OF PERSON AUTHORIZED TO SIGN

AND

ADDRESS

OF

OFFEROR

OFFER (Type or print)

15B. TELEPHONE NO. (Include area code)

ADDRESS IS DIFFERENT FROM ABOVE - ENTER SUCH ADDRESS IN SCHEDULE

AWARD (To be completed by Government)

x

Small Business Set-Aside (19.502-2 )

41 U.S.C. 253( c ) ( )

(4 copies unless otherwise specified)

(Signature of Contracting Officer)

IMPORTANT - Award will be made on this Form, or on Standard Form 26, or by other authorized official notice.

NSN 7540-01-152-8064

PREVIOUS EDITION NOT USABLE

33-132

STANDARD FORM 33 (Rev 9-97)

Prescribed by GSA FAR (48 CFR) 53.214( c )

PART I – SCHEDULE B

B. 1 CONTRACT DEFINITION

This is a Requirements contract as defined at Section 16.503 of the Federal Acquisition Regulation (FAR) and in Section I.4, FAR clause 52.216-21, Requirements. Services or supplies provided by the contractor under this contract shall be secured by the issuance of delivery orders (for supplies) or task orders (for services). Orders shall be placed in accordance with the following clauses: FAR 52.216-18, Ordering; FAR 52.216-19, Order Limitations; and with [ ] Delivery Ordering Procedures, or [X] Task Ordering Procedures.

B.2.

SERVICES

This contract will provide real estate property sales closing services for single-family (one to four units) properties owned by the U.S. Department of Housing and Urban Development (HUD) located within the geographic area(s) described below.

B.3.

GEOGRAPHIC AREA(S)

The geographic area(s) covered under this contract shall be the States of Massachusetts and

New Hampshire.

B.4.

PRICING SCHEDULE

As total compensation for all services required and performed in accordance with the terms and conditions of this contract, the Contractor will be paid according to the Contract Line Item Number (CLIN) firm fixed prices listed herein below for assigned property closings, unless otherwise specifically stated in this contract.

a.

Property Closing Services (Tasks 1, 2, 3, 6 and 7). The fixed unit price for Property Closing Services specified herein will be a flat fee. Unless otherwise specified herein, this flat fee will include the cost of all services and the preparation of all documents required by any party to the closing, including any loan documents required by any lender. The unit price will include, without limitation, the cost of phones, postage, shipping, delivery, courier service, express mail, faxing, scanning, document reproduction (including reproduction of the satisfaction survey forms), postage prepaid envelopes, transportation, wire transfer fees incurred by the Contractor relative to the wire of HUD's proceeds to Treasury, cost of title searches required by this contract, any and all licenses, insurance, certificates or permits that may be required as stated in Section C.3 (a) (2), attorney fees, costs related to deed preparation and all office requirements as referenced in this contract.

b.

Special Programs:

(1) Good Neighbor Next Door Program (GNND) (Task 4). For closings assigned under the GNND program, the Contractor will be paid the unit price reflected in the CLIN for this Task in addition to the unit price reflected in the CLIN for Property Closing Services. The purpose of this additional fee is to compensate the contractor for the requirements under this program that are in addition to the basic requirements under Property Closing Services. The unit price will only apply where the Contractor is required to prepare and record a Second Mortgage and a Second Lien Mortgage Note in accordance with the requirements contained in Section C.3.d. This additional fee must be reflected as a separate line item on the HUD–1 as a charge to the Seller with the notation “*ND 2nd Mortgage and Note Fee” for GNND program closings (* using the acronym “OND” for the Officer Next Door program, “TND” for the Teacher Next Door program, “FFND” for the Firefighter Next Door program or “EMTND” for the Emergency Medical Technician Next Door program).

(2) Asset Control Area (ACA) Program (Task 5). For closings assigned under the ACA program, the Contractor will be paid the flat fee reflected in the CLIN for this Task in addition to the unit price reflected in the CLIN for Property Closing Services. The purpose of this fee is to compensate the Contractor for the additional requirements under this program that are in addition to the requirements under Properly Closing Services. This fee will only apply where the Contractor is required to perform the additional duties directly related to this program in accordance with the requirements contained in Section C.3. e. This additional fee must be reflected as a separate line item on the HUD-1 as a charge to the Seller with the notation “ACA Program.”

Note: For all geographic area(s) containing an estimate of zero (0) for this CLIN (“ACA Program – Additional Fee (Task 5)”), the offeror must include a proposed unit price so that pricing will be in place should an ACA Agreement become effective within the geographic area during the relevant contract year.

c.

Special Services (Tasks 8, 9 and 10): The Contractor will be paid the unit price reflected in the CLINs for Special Title Search Services (Task 8), Special Recordation Services (Task 9) and Special Document Preparation Services (Task 10) that may be ordered by the GTR. The CLIN prices for these Special Services, specified in Section C.3. h, will be inclusive of all costs specific to those services. These Special Services are not associated with the title search services, document preparation and/or recordation services required as part of Property Closing Services for day-to-day assignments of HUD Sales Contracts under this contract. The Contractor will not receive compensation under the CLINs for Special Services performed as part of the Property Closing Services.

d.

Third Party Closings. For third party closings at which the Contractor or Key Personnel must physically represent HUD, and another party represents the purchaser(s). Such closings will be conducted during normal business hours at the location of the third party closer chosen by the purchaser or at an agreed upon location.

e. Aborted Closing, as relates to CLIN 0007, occurs only when an assigned sales contract is cancelled by the Asset Manager due to a failure by the purchaser to perform in accordance with Sales Contract, form HUD-9548 and addendums, or by HUD in accordance to Sales Contract, Conditions of Sale, paragraph D.

Note - An aborted closing occurs when the failure to close was not caused by the Closing Agent’s nonperformance or lack of timely performance under the terms of Closing Agent Services contract and only after the sales contract was cancelled by HUD or the Asset Manager. When the failure to close was caused by the Closing Agent’s nonperformance or lack of timely performance, the Closing Agent shall not be entitled to compensation.

f.

Prohibited Compensation. The Contractor may not collect from any party, any fees for services or documents required hereunder and associated with Property Closings Services conducted under the contract above and beyond the CLIN unit prices and special fees set forth in this Pricing Schedule. The Contractor will not add any fee to any customary closing cost paid by HUD or the purchaser(s). The only exception to the above is if the purchaser or the purchaser’s lender demands additional services, such as title examinations and/or title insurance outside the contract duties, and such services are performed by the Contractor, the Contractor must look outside of this contract for payment for those services or documents.

g.

Title Insurance. This contract does not include title insurance services nor does HUD require a purchaser of a HUD-owned property to acquire title insurance. The purchase of a title policy is strictly at the purchaser’s discretion and is not required to close a HUD property. The Contractor will not influence the purchaser to obtain a title policy from any particular company. The choice of the title company issuing the title policy will be left to the purchaser.

h.

Interest Income. In no case will the Contractor be authorized to earn any interest income (such as escrow account interest/float income) as a result of services provided under this contract.

First Contract Year – Base Period - Massachusetts

Requirement

Second Contract Year –Option Period One Massachusetts

Requirement

Third Contract Year – Option Period Two Massachusetts

Requirement

Fourth Contract Period – Option Period Three Massachusetts

Requirement

First Contract Year – Base Period – New Hampshire

Requirement

Second Contract Year –Option Period One- New Hampshire

Requirement

Third Contract Year – Option Period Two- New Hampshire

Requirement

Fourth Contract Period – Option Period Three- New Hampshire

Requirement

Estimated Total Value of the Fourth Contract Year

Note: Offerors shall submit cost/pricing information on both areas in schedule B to be considered for award. However, the Government will evaluate each geographic area independently to determine if one (both areas) or two (one per contract area) contracts will be awarded. The Government reserves the right to award one contract per area to different offerors that propose on this solicitation.

SECTION C

STATEMENT OF WORK (SOW)

C.1

BACKGROUND

a.

Single Family Mortgage Insurance Program. The Federal Housing Administration (FHA), an agency of the U.S. Department of Housing and Urban Development (HUD), administers the Single Family Mortgage Insurance Program. Upon default and foreclosure of an FHA-insured loan, the lender files a claim for insurance benefits. In exchange for payment of the claim, the lender conveys the foreclosed property to HUD. HUD, through an Asset Manager (AM) contractor, manages and sells a sizable inventory of single family (one to four units) homes in a manner that promotes homeownership, preserves communities and maximizes the return to the FHA insurance fund. To complete the sales of the properties, HUD requires the services of Closing Agent contractors (referred to as “Contractor” herein) to perform all necessary closing activities on its behalf.

b.

Interaction/Impact. Performance under this contract will involve interaction with homebuyers and their representatives in the real estate community, mortgage lenders, nonprofit housing and advocacy organizations, staff from HUD’s Homeownership Center, and other service providers under contract to HUD, such as the AM Contractor. Additionally, this contract may be impacted by changes in regulation or legislation and by housing policy initiatives identified by the White House or the HUD Secretary.

C.2

SCOPE OF REQUIREMENTS

a.

Purpose. This is a fixed price contract with a single unit price per completed closing. The Contractor must proactively work with purchasers, brokers and the AM Contractor, any successor contractors, the GTR and the GTM to ensure that closings are performed in a timely and accurate manner. The Contractor will perform to meet or exceed the performance standards specified in this contract.

b.

Objectives. The primary objectives of this contract are to: (1) proactively represent HUD’s interests at the sales closing; (2) close on the sales contract as soon as possible after the contract is executed; (3) ensure that the accurate amount of funds are obtained at closing and that funds received are accurately and timely provided to HUD's account at the U.S. Treasury; and (4) accomplish the closings with error-free closing documents and ensure that all documents are properly recorded.

c.

Results and Outputs. The Contractor’s performance under this contract must ensure that: (1) closings are fully completed as soon as possible but no later than the date specified in the Sales Contract (unless an extension of time to close has been approved, in writing) and closing packages are submitted to the AM Contractor within required timeframes so that all cases can be reconciled as quickly as possible; (2) the accurate amount of funds are collected at closing and transferred to the Treasury with few or no assessments of liquidated damages for untimely processing; (3) the Contractor’s internal quality management includes identifying and correcting errors in processing requirements; and (4) a positive image of HUD is achieved as measured through customer satisfaction surveys revealing that the Contractor is providing exceptional service to purchasers and brokers.

C.3

TASKS AND DELIVERABLES

a.

Task 1: General Requirements. The primary objective is to perform closings on the sale of HUD-owned properties accurately and as quickly as possible. Typically, a purchaser is provided up to 60 calendar days to close the transaction. However, from time to time, HUD may offer special incentive programs to homebuyers to close in a shorter period of time, such as 30 days after Sales Contract execution. The Contractor will coordinate with the purchaser(s), the broker and the AM to affect the closing within the time frame specified in the Sales Contract (HUD-9548) unless an extension request is approved, in writing, by the AM or the GTR.

(1) Office and Contract Manager.

(a) The Contractor must establish and maintain a fully staffed, equipped, and supplied main office within the geographic area(s) identified in Section B so as to provide convenient service to HUD and its clients. The Contractor must have toll free fax and telephone numbers and an active email address through which HUD’s clients can contact the main office without incurring long distance charges. The Contractor must take proper health and safety precautions to protect workers, the public and the property of others. The Contractor must maintain the office(s) to manage assigned closings and provide service from 8:00 AM to 5:00 PM, local time in the geographic area, Monday through Friday, with the exception of recognized Federal holidays.

Note: Although only one office is required under this contract, the Contractor is responsible for performing tasks throughout the geographic area(s) in a timely manner. The Contractor may establish other offices that it believes are necessary to facilitate the provision of services in a timely manner throughout the geographic area(s) or propose another method of acceptable coverage.

(b) The Contractor must provide a Contract Manager who will be responsible for the performance of all work under this contract. The name of this person and an Alternate who will act for the Contractor when the Contract Manager is absent must be designated in writing to the Contracting Officer and the GTR. Both individuals will be considered Key Personnel. The Contract Manager or Alternate must be available to HUD staff during normal business hours to discuss all areas of performance under this contract and will have full authority to act for the Contractor on all contract matters relating to daily operations under this contract.

(2) Insurances, Licenses and Certifications. The Contractor must obtain necessary licenses, insurance certifications and permits required in the performance of the contract and must comply with any Federal, state, county and municipal laws, codes and regulations applicable to the performance under this contract. HUD holds the Contractor fully responsible for ensuring such compliance. The Contractor must ensure that all subcontractors comply with these requirements. Upon request, the Contractor must provide copies of the foregoing licenses, insurance certifications and permits. At the commencement of the contract term, and thereafter upon request, the Contractor must provide an unequivocal opinion of counsel stating that the Contractor, and each of its subcontractors, is in full compliance with all state and local licensing requirements, and that all required permits have been obtained.

(3) Escrow Account.

(a) Establish Account: The Contractor will establish a non-interest bearing escrow account (unless otherwise required by state law) for all sales proceeds, including earnest money deposits, loan proceeds, and purchaser’s funds presented at closing. The escrow account must be in the name of the Contractor with the restriction: “As Trustee for the U.S. Department of Housing and Urban Development.” All distributions of funds must be made from this account. The cost, if any, of maintaining and operating this account will be at the expense of the Contractor. This escrow account must be used only for purposes of this contract and, in the event the Contractor has multiple contracts with HUD, the Contractor will ensure that a separate account is maintained for each contract. The Contractor will not co-mingle funds relating to different contracts. The escrow account will be established in a financial institution that issues a receipt for the deposit, gives credit for deposited funds immediately upon clearance, and has the capacity to transmit all of the information contained in the form SAMS-1103, in its exact format. The Contractor will enter into a letter of agreement with its bank that upon demand by HUD, the account will be re-titled into HUD’s name. The Contractor is to be the sole custodian of the HUD escrow account. The Contractor may not delegate, assign or subcontract HUD escrow account responsibilities or allow account access to its affiliates or subcontractors. The Contractor will make its bank statement available to the Contracting Officer, the GTR and/or the GTM upon request.

(b) Monthly Account Reconciliation: The Contractor must provide monthly bank statements to the GTR as soon as possible, but no later than 30 calendar days following the statement ending date and a signed letter affirming that the statement has been reconciled. The letter shall also include the number and amount of each check that has been outstanding for more than sixty (60) calendar days and the efforts put forth by the Contractor to clear these checks.

(c) Account Close Out: As soon as possible following termination or expiration of this contract, but no later than 90 days following such termination or expiration, the Contractor will close the escrow account and provide the GTR with a cashier’s check made payable to the Secretary of HUD for the balance in the account. Within 30 days following closing of the account, but no later than 120 days following the termination or expiration of the contract, the Contractor must provide the GTR with a detailed written reconciliation report of all funds covered by said cashier’s check, including a copy of the final bank statement showing that the account has been closed and that there is a zero balance in the account. The reconciliation report must reflect the FHA case number, property address and the dollar amount associated with the property and the type of funds (e.g. extension fees; refunds; etc.). The individual case amounts reflected in the reconciliation report must match the amount of the cashier’s check.

(4) Quality Control (QC) Plan. The Contractor must establish and maintain a complete QC plan to ensure the requirements of the contract are performed as specified. Two copies of the Contractor’s final QC plan will be provided to the Contracting Officer no later than the post-award conference. The Contractor will provide two complete copies to the Contracting Officer as any updates/changes occur. The plan must include:

(a) Identification of the tools or methods the Contractor will use to ensure that all required time frames in the contract are met;

(b) A QC review system covering all of the service requirements listed on the Performance Requirements Summary. It will specify the requirements to be reviewed on either a scheduled or unscheduled basis, how often reviews will be accomplished, or the title of the individual(s) who will perform the reviews. It will also specify how records of all reviews conducted by Contractor and/or subcontractor personnel will be maintained, including documentation of corrective action taken when reviews reveal discrepancies, and where those records will be maintained to ensure access by HUD personnel throughout the term of the contract;

(c) A description of the methods for selecting responsible subcontractors and for monitoring their performance. Include copies of actual or proposed subcontract agreements, including all required FAR clauses that will flow down to the subcontracts; and

(d) Adequate internal control measures to ensure that: (i) case files and file documents are managed and controlled to prevent any loss of documents or disclosure of purchasers’ personal information to unauthorized third parties; and (ii) funds received and paid out are properly and timely managed and cases are timely reconciled.

(5) Safeguarding of Personally Identifiable Information (PII). PII includes, but is not limited to, any information about an individual, including financial transactions, employment history and information which can be used to distinguish or trace an individual’s identity, such as their name, social security number, date and place of birth, mother’s maiden name, etc., or any other personal information that is linked or is linkable to an individual. The Contractor is responsible for implementing adequate safeguards to ensure that such PII is not made available, whether intentionally or unintentionally, to parties not involved in the sale of the property to the purchaser or to employees of the Contractor and subcontractor that do not require access to such PII in order to perform their responsibilities under the contract. Any documents containing PII that are not subject to the records retention requirements set forth in Section C.3. a. (7) must be destroyed in a manner that ensures that the PII is properly safeguarded (e.g. shredded). With respect to electronic records that contain PII, the Contractor must, at its own expense, destroy such records in a manner that ensures that PII is properly safeguarded. The Contractor must, at all times, comply with applicable requirements of HUD’s Information Technology Security Policy (current Handbook 2400.25 REV-2 dated 10/1/08).

In the event of any incident involving loss or compromise of PII by Contractor or subcontractor personnel, it is imperative that the Contractor report the incident immediately to the GTR and the Contracting Officer, within 45 minutes of the occurrence, so that HUD can report the incident within one hour, as required by OMB Memorandum M-06-19, dated July 12, 2006.

(6) Records Maintenance (a) Throughout the entire life of the contract, the Contractor must maintain a system of recordkeeping which will ensure that physical and electronic documents are: (i) properly and promptly filed upon receipt; (ii) not lost or misplaced; (iii) easily and promptly retrieved upon request by the GTR, GTM, Contracting Officer or any other authorized person; and (iv) maintained securely and with complete confidentiality.

(b) Minimum records to be maintained include: (i) bank statements and proof of deposits for the required escrow account; (ii) proof of wire transfers of proceeds; (iii) canceled checks for disbursements (including the property address and notation of types of expenses); (iv) a log of all payments received, recorded separately, showing the FHA case number, date, amount, purpose, and if payment was made at closing or outside of closing; and (v) copies of each document related to the closing performed.

(c) The Contractor will retain the complete record of each closing, keeping all information confidential. It is understood that in the process of performing the responsibilities set forth in the contract, the Contractor will receive physical and/or electronic copies of documents and reports that include Personally Identifiable Information (PII). It is the Contactor’s responsibility to strictly ensure the confidentiality of PII relating to each purchaser.

(d) The Contractor must retain all pertinent records, as identified in subsection (b) above, throughout the life of the contract. At the expiration of the contract, the Contractor must store all records, at the Contractor’s expense, for a period of three years after contract expiration. HUD will have access to all records upon request. After three years, the Contractor will, at its own expense, destroy such records in a manner that will maintain the confidentiality of all PII contained in the records.

(7) Subcontracting. Any subcontractor providing services under this contract must either be clearly identified in the technical submission as Key Personnel or approved, in writing, by the GTR and the Contracting Officer prior to any performance under the contract. The subcontractor must not have a negative performance history or be suspended or otherwise prohibited from doing business with the Government. The Contractor will be solely responsible for all performance under this contract, including any services performed by subcontractors. The selection of a subcontractor must not violate any conflict of interest provision contained herein.

b.

Task 2: Pre-closing Activities. The Contractor will perform all pre-closing actions, including but not restricted to the ones detailed below, necessary to ensure that closing occurs as scheduled.

(1) Establish Closing File: The Contractor must establish a closing file upon receipt of the Sales Contract package from the AM. The Sales Contract package will include: (a) a signed Sales Contract (HUD-9548) with any addenda and amendments; (b) title evidence (when available); (c) documentation regarding status of rents due to HUD (when purchaser is HUD’s tenant); and (d) bulk sales listing (if applicable).

NOTE: If the title evidence from acquisition is not available at the time of the initial assignment, it will be forwarded under separate cover when it becomes available. Mortgagees are allowed 45 days from the date a deed is recorded in the Secretary's name to submit the required title evidence/policy for review. Therefore, such title evidence will not always be available at the time a case is assigned to the Contractor. At a minimum, the Contractor will be provided with the date of acquisition (the date the deed was recorded in the Secretary's name).

(2) Title Bring Down for Property Closing Services. Although HUD does not warrant or guarantee title, HUD’s intent is to convey clear and marketable title to purchasers. As such, the Contractor must perform a tax search and a title examination, including the land, judgment and tax records, and any other records which may contain information which affects the title or may reflect a lien, encumbrance or defect on the title, from the date of acquisition by the Secretary of HUD to the date on which the closing package is assigned to the Contractor. The Contractor must report to the AM, via email or facsimile, within seven business days of initial assignment of the case on the results of the search, indicating either that no defects were found or a description of any defect(s) and the steps taken, or to be taken, by the Contractor to resolve the defect(s). The Contractor must take action to clear all minor title issues (such as tax liens and assignments) in such a manner as to avoid any delays in closing. Major title defects that are not routine in nature must be brought to the attention of the AM within one business day of discovery. If the results of the search reveal any Federal government interests, the Contractor will consult with the GTR prior to forwarding the report to the AM.

(3) HOA and Condominium Documents. The Contractor will be responsible for obtaining any Homeowner Association or Condominium Association documents that may be required by local law. The Contractor will also be responsible for ensuring that such documents are provided to the purchaser either at the time of closing or prior to closing in accordance with local law. The actual cost of such Association documents (e.g. fee charged by the Association) will be noted as a seller’s expense on the HUD-1, with the notation “HOA/Condo documents.” Efforts expended in obtaining such documents are part of the contract unit price per property closing. A copy of such documents must be maintained in the property case file.

(4) Written Notifications. The Contractor must provide written notifications as required below:

(a) Not less than fifteen calendar days prior to the latest possible closing date, as reflected on the Sales Contract or in accordance with the latest Extension Approval form, if a firm closing date has not been established, the Contractor must provide the broker with a written warning (e.g. fax; email) that the contract is set to expire as of a specific date and closing has not been scheduled. A copy of the written notice must be sent to the AM.

(b) On the next business day after the Sales Contract expiration date, if no closing has occurred, the Contractor must notify the broker, in writing (e.g. fax; email), that the sale did not close and that the Sales Contract has expired. A copy of the written notice must be sent to the AM.

(5) Deed and Closing Instructions. When a closing has been scheduled, the Contractor will notify the AM of the date via fax or email. The Contractor must accurately prepare the Special Warranty Deed and any other locally required documents that require signature (e.g., local tax transfer affidavits) and forward them electronically to the AM for review and signature, normally ten (10) business days prior to the scheduled closing. The deed, and all other required documents, must be prepared in accordance with applicable local, state and Federal laws. The AM will return the signed deed and other documents to the Contractor no sooner than five (5) calendar days prior to the scheduled closing.

NOTE: The original signed deed will be voided and returned to the AM if closing does not take place within 7 calendar days of the date of the Special Warranty Deed.

(6) Special Discount Programs. The Contractor may periodically be assigned closings involving programs whereby HUD makes discounted sales to governmental entities and to HUD-approved nonprofit organizations, including $1 Home Sales. The Contractor will not receive any compensation in addition to the CLIN price for Property Closing Services for work performed in connection with a closing conducted in accordance with one of these Special Discount Programs.

(a) Assignment: Upon assignment of a closing of a discount sale to a governmental entity or a HUD-approved nonprofit organization, the Contractor will receive from the AM, in addition to basic closing documents, a completed Addendum to Sales Contract for $1 Home Sales or Land Use Restriction Addendum for Non-profit organization, whichever is applicable.

(b) Deed: When preparing the required deed for a sale under one of these Special Discount Programs, the Contractor must ensure that the appropriate “deed restriction” clause is included, in accordance with the written instructions provided by the GTR and in accordance with any referenced HUD guidance. (Note: No deed restriction is required for $1 Home Sales closings.)

(7) Rental Monies. If the buyer is a HUD tenant, the Contractor must verify with the AM that all rental monies due to HUD have been paid outside of settlement. If any due amounts have not been paid, the Contractor must ensure such payment is made at time of closing.

(8) Extension Requests. The Contractor will administer broker requests for extensions of the Sales Contract. Such requests may only be accepted via the Closing Extension Request form, including required supporting documentation, and must be accompanied by the full non-refundable fee, in the form of a cashier’s or certified check, or money order. No extension will be processed without the extension fee unless prior written approval has been provided by the AM. No extension may be granted without the express written approval from the AM, GTR or GTM. The AM has full authority to waive any extension fee.

(a) Not more than one business day after receipt of the extension request, the Contractor must fax/email the request and all required supporting documentation (including a copy of the check) to the AM.

(b) If the extension request is approved by the AM, the Contractor must deposit the extension funds into the contract escrow account and notify the broker, in writing (e.g. fax or email) no more than one business day after approval.

(c) If the extension request is approved by the AM and the fee is waived, the Contractor must refund the extension funds to the broker within one business day of approval and fee waiver.

(d) If the extension request is denied by the AM, the Contractor must refund the extension fee to the broker, no later than one business day after denial, with written (e.g. fax or email) instructions to close by the date required by the Sales Contract.

(e) If an extended sale fails to close, the Contractor must, no more than one business day after the expiration date of the extension, electronically notify the AM and forward the extension fee and a copy of the extension approval to the AM with the notation “FAILED TO CLOSE.”

(f) For each case where a closing is delayed due to title-related issues, and a closing cannot take place within the required time frames due to such delays, the Contractor will prepare an Extension Request form, documenting the specific reason(s) for the delay (e.g. describe title problem) and the estimated length of the delay, and forward the request to the AM as outlined above for approval. Under such circumstances, where the delay is caused by HUD's inability to provide clear title, it would not be the responsibility of the broker/purchaser to request an extension.

(9) Cancelled or Expired Sales Contracts. For cases where the Sales Contract has been cancelled, or where closing failed to occur by the date reflected in the Sales Contract or under an approved extension, the Contractor will return the original signed deed to the AM no later than the second business day after the Sales Contract was cancelled or expired.

(10) Preparation of the HUD-1.

(a) Accurate preparation of the HUD-1 is critical to timely processing. The Contractor shall use an automated closing processing software package to complete the HUD-1 and to minimize errors. The Contractor must prepare the HUD-1 so as to facilitate a full and complete closing, including all required disbursements, collections and deposits. For all closings, the Contractor must submit a copy of the prepared HUD-1, via facsimile or electronically, to the AM for review, twenty-four (24) hours prior to the scheduled closing date. [NOTE 1: Although the AM reviews the HUD-1, HUD will hold the Closing Agent fully responsible for the accuracy of all HUD-1's.] [NOTE 2: This requirement also applies to 3rd party closings.]

(b) Recording Penalties and Interest. For items such as taxes, condo/HOA fees, etc., where the AM is responsible for paying such bills in a timely manner, if any penalties and/or interest charges are reflected on any of the final bills obtained by the contractor, such penalties and/or interest charges must be reflected on the HUD-1, as a seller’s expense, as a separate line item in the appropriate section. For example, if a final utility bill is obtained and the bill reflects overdue charges, the actual bill amount would be reflected on one line with the overdue charge reflected with the same title, but preceded with “P&I” (e.g. “Water Bill” on one line and “P&I Water Bill” on a separate line). The amount of the penalty and/or interest must also be reflected in the Contractor’s weekly report of closed cases under a separate column with the heading “P&I Charges.”

(c) Extension Fees. At closing, the extension fee will not be applied to the amount due from the buyer unless the sale closes prior to the expiration of the extension, in which case the buyer will be credited with a prorated (based on calendar days) portion of the fee. The full amount of the fee will be reflected on lines 104 and 404 of the HUD-1. Any credited portion will be reflected on lines 206 and 506.

(11) Third Party Closings: The Contractor or designated Key Personnel must physically represent HUD at all closings that are conducted by a third party. Although the Contractor is permitted to work out a mutually agreed upon closing location, the purchaser ultimately decides and controls the location of the third party closing. For such closings, the Contractor’s responsibilities are as follows:

(a) Within one business day of notification of a third party closer, forward a letter to the third party closer, outlining HUD’s requirements and time frames. The Contractor must clearly inform the third party closer that:

· at least 10 days notice is required to schedule a closing with HUD’s Closing Agent in order to have a signed deed available;

· HUD requests the submission of the completed HUD-1 for review by the AM Contractor at least 24 hours before closing;

· HUD requires certified funds or receipt of a wire transfer of the sales proceeds at or prior to closing; and

· HUD requires a copy of the recording receipt for the executed deed within 3 business days of closing.

(b) Perform the required title bring down search on HUD’s behalf (as outlined under C.3 b. (2)).

(c) Prepare the deed and forward to the AM for signature (as outlined under C.3 b. (5)) once closing has been scheduled.

(d) At closing, ensure that the HUD-1 is accurate before executing on HUD's behalf. As previously stated, HUD holds the Contractor responsible for the accuracy of the HUD-1.

(e) Upon receipt of the sales proceeds from the third party at closing, deposit the funds into HUD’s escrow account and initiate the wire transfer of the funds to HUD’s Treasury account on the day of closing or the next banking day. Submit original wire receipt to the AM with the closing package.

(f) The Contractor is responsible for overseeing that the deed transferring title to HUD’s purchaser is filed for record. The Contractor will obtain proof or recordation (e.g. copy of the recording receipt) from the third party for submission with the closing package to the AM or submit such proof within 24 hours of receipt from the third party. If the Contractor is unable to obtain a copy of the recording receipt from the 3rd party closer, the Contract must obtain proof from the recording office within 30 days of closing and submit such proof to the AM.

(g) Forward closing package (as outlined under C.3 f. (4)) to the AM to be received no later than the third business day after closing.

(h) The Contractor will ensure that any problems encountered with the third party closing are clearly addressed as part of the HUD Closing Agent’s certification (as outlined under C.3 f. (4)(f).

c.

Task 3: Closing Activities. The Contractor or designated Key Personnel must conduct the actual closing at an acceptable office location, as stated in the Contractor’s technical proposal and as accepted by the Contracting Officer. The Contractor or designated Key Personnel must be physically present at every closing. The Contractor will make every reasonable attempt to work out a mutually agreed upon location with the purchaser. Closings may not be conducted by mail, fax, telephone or other means unless prior written approval is obtained from the GTR on a case-by-case basis. The closing will be completed timely and accurately. At the closing, the Contractor must perform all required actions, including the following activities:

(1) Closing Documents. Explain all closing papers and documents to the purchaser(s).

(2) HUD-1: Complete and execute, in its capacity as HUD’s agent, the Settlement Statement (HUD-1) in the block indicated for seller. The Contractor will sign the HUD-1 for HUD as the agent for HUD (not as the seller itself).

(3) Other Documents: Complete and execute all documents necessary to provide a complete closing (e.g., deed, note and mortgage or deed of trust, tax affidavit, etc.).

(4) Sales Proceeds: Accept only certified or cashier’s check made payable to the Contractor. Electronic transfer of funds is also acceptable; however, the receipt of funds must be confirmed by the Contractor prior to closing the sale.

(5) Payment of Taxes and Assessments: Provide tax certificate(s) or similar documentation to prove taxes have been paid. This documentation must be submitted with the closing package.

(6) Allowable Closing Expenses Payable from HUD’s Proceeds: From HUD’s sales proceeds, pay any allowable seller closing expenses, as previously identified hereinabove, that are due and payable at the time of closing. Unpaid property taxes, condo fees, HOA fees, ground rents and utility bills for the current year must be prorated and paid at the time of closing. The AM must be kept fully informed of these transactions.

(a) The Contractor will pay only those costs listed as closing costs automatically paid by HUD as reflected in the most current Housing Notice (Notice H 2009-17 dated 10/8/09) or subsequent official guidance that may be issued. The Contractor will pay the expenditures listed therein, as herein qualified, at the time of closing from HUD’s sales proceeds. In the event that sales proceeds are insufficient to pay all allowable expenses, the Contractor will, as required by Section H, advance payment for any excess expenses and request reimbursement from HUD through the submission of an invoice (see Section G).

(b) Also in accordance with the most current Housing Notice (Notice H 2009-17 dated 10/8/09) or subsequent official guidance regarding allowable closing costs, for cases where the executed HUD-9548, Sales Contract, reflects approved closing costs on Line 5, the Contractor will charge allowable closing costs to HUD, not to exceed the amount reflected in the Sales Contract. Contractor must clearly identify Line 5 credits on the HUD-1 (e.g. "Line 5 Credit"). Contractor must also explain to purchaser(s) that Line 5 Credits may only be applied to allowable closing costs and that the purchaser(s) is not entitled to any amounts above the allowable closing credits, even if the total amount on Line 5 of the sales contract is not reached.

Note: Wire transfer fees for sales proceeds wired to the Contractor is the buyer’s expense and is not paid by HUD. Wire transfer fees for sales proceeds wired by the contractor to HUD’s Treasury account are at the contractor’s expense.

(c) If there are reasonable and customary closing costs that are paid by the seller in the local real estate market(s) covered by this contract that are not included in the most current Housing Notice (Notice H 2009-17 dated 10/89/09) or subsequent official HUD guidelines, the Contractor may submit a request, in writing or via email, to the GTR for approval of such additional costs as allowable closing costs. The Contractor must clearly identify all such additional closing costs and submit them with complete explanation/justification to the GTR for “blanket” approval of these items as allowable closing costs.

d.

Task 4. Good Neighbor Next Door (GNND) Program. The GNND Program encompasses the Officer Next Door, Teacher Next Door, Firefighter Next Door and Emergency Medical Technician Next Door programs. The duties outlined below are in addition to basic closing duties outlined in Tasks 1, 2, 3, 6 and 7.

(1) Assignment: Upon assignment of a sale under a Next Door program, the Contractor will receive from the AM Contractor, in addition…