Attachment 2- Performance Work Statement (PWS).docx

PERFORMANCE WORK STATEMENT (PWS)

Judicial and Non-Judicial Foreclosure Legal Services & Related Technical Support for the States of North Carolina, South Carolina, and Arkansas February 12, 2026

A.1. OBJECTIVE.

The objective is for the United States Department of Agriculture (USDA), Rural Development mission area (the “Client”), to retain counsel (the "Contractor") for 42 U.S.C. 1480(d)-related services for foreclosure and related default management legal services.

The purpose of the pilot will be to generate standardized, reliable operational and financial data to inform the design of a future national default management services portfolio.

It is designed to test processes, pricing, documentation, borrower responses, and data reporting under real world conditions using a single contractor with legal standing to complete services directly on Client’s behalf.

This is a non-personnel services contract to provide legal foreclosure support services including but not limited to foreclosure services (FCL), eviction services, and mediation services. The Client will not exercise any supervision or control over the contract employees/subcontractors performing the services herein.

Order of Precedence In the event of inconsistencies, between the contractor’s quote and PWS, the required work specified in this PWS will take precedence over the contractor’s quote.

A.2. BACKGROUND.

Section 1045 of the Stewart B. McKinney Homeless Assistance Act of 1988 amended Section 510(d) of the Housing Act of 1949 [42 U.S.C. 1480(d)] to provide that with respect to the prosecution or defense of any litigation under Section 502 [42 U.S.C. 1472], The Secretary of Agriculture may retain United States attorneys; the General Counsel of USDA (OGC); or any other attorney with whom the Secretary enters into a contract after determining that the attorney will provide competent and cost-effective representation for USDA. The representation will either accelerate the process by which a family or person eligible for a Section 502 loan will be able to purchase and occupy the housing involved or preserve the quality of the housing involved. Section 502 loans are generally secured by first mortgages on residential property located on nonfarm tracts of one acre or less. In some instances, USDA also holds subsequent mortgages on security, usually without intervening liens.

A.3. SCOPE.

The scope of this contract encompasses non-personal services to provide post acceleration Default on behalf of the Client utilizing applicable USDA, HUD, Fannie Mae, and Freddie Mac standards. These services include foreclosure services (FCL), real estate owned services (REO), mediation services, eviction services, and bankruptcy services in the following states:

Arkansas: Non-Judicial North Carolina: Quasi-Judicial South Carolina: Judicial

The contractor shall act as the sole entity responsible for all services in the geographic locations under this pilot.

As assigned by the Client, and with the understanding that the Contractor will be provided with all federally required pre-default account information, documents, and approvals and authority needed to provide the legal services requested hereunder. The Contractor’s scope of services covers the collection of 42 U.S.C. 1480(d)-related claims and obligations arising out of or under any mortgage, lease, contract, or agreement including:

(a) Prosecution and defense of foreclosure and related litigation for up to 100 accounts in each state.

(b) Obtaining possession of real property, securing collateral, and enforcing any deficiency and/or other judgment(s).

(c) The legal services described in Section A.5.

All litigation shall be prosecuted in the federal or state court appropriate for the services designated in the task order, when applicable.

A.4. CONTRACTOR WARRANTS STANDARDS.

The Contractor warrants:

(a) All attorneys providing legal services under this contract are members in good standing of the appropriate state bar and courts and have the legal knowledge, skill, thoroughness, and preparation reasonably necessary for the representation.

(b) Legal services under this contract shall comply with all applicable Federal, State, and local statutes, ordinances, regulations, Records maintained on individuals (5 U.S.C. 552a), the Fair Debt Collection Practices Act (15 U.S.C. 1692 et seq.), the Debt Collection Act of 1982, as amended (31 U.S.C. 3701 et seq.), and the applicable Rules of Professional Conduct (RPC) throughout the term of this contract.

(c) The Contracting Officers Representative (COR) must be promptly informed of any decision or circumstance with respect to which the Client’s informed consent, as defined in the RPC, is required; reasonably consult with the COR and Program Representative (PR) about the means by which the Client's objectives are to be accomplished; keep the COR/PR reasonably informed about the status of each case or matter; promptly comply with the COR’s and CO information requests; consult with the COR/CO about any relevant limitation on the Contractor’s conduct when the Client expects assistance not permitted by the RPC or other law; and shall explain each matter to the extent reasonably necessary to permit the COR/CO to make informed decisions regarding the representation in each given case. For example, unless the COR directs otherwise, the Contractor must provide the COR with copies of all pleadings (including complaints, answers, affirmative defenses, and counterclaims), motions, orders, and/or material communication or correspondence (including electronic communications or correspondence) upon receipt (if by borrower) or one business day prior to filing (if by Contractor), as appropriate. The Contractor must also promptly notify the COR/PR when any pleading, motion, order, and/or material communication or correspondence raises a significant question of law or fact that could create an adverse precedent or adversely affect the rights or collection efforts of the United States. The Contractor must also notify the COR/PR of all court dates, whether for arguments, examinations, trials, or otherwise, upon receipt.

(d) Violation of these warrants and/or of any applicable statute, ordinance, regulation, or ethical standard, whether by the Contractor or by any attorney providing legal services hereunder, shall be cause for immediate termination of this contract.

A.5. DESCRIPTION OF SERVICES. As part of the general scope of services:

1. Foreclosure

a) Within 15 business days after acceptance of a case file, the Contractor must confirm the state of title of secured property; conduct a commercially reasonable asset search of the borrower; and then commence legal action to foreclose, obtain possession, and sell the secured property in the minimum time permitted under law. The Contractor must immediately notify the COR/PR of the state of title, identify other lien holders including but not limited to any agency or instrumentality of the United States other than the Client, and specifically identify superior liens and options for obtaining priority lienholder status. The Contractor, in unison with the Client’s input, shall utilize foreclosure procedures most advantageous to the Client considering time and cost. Acceptable HUD foreclosure timeframes are listed in https://www.hud.gov/sites/default/files/OCHCO/documents/40001-hsgh-Update-17.pdf. The date of “first legal” shall be 90 calendar days or sooner after case assignment from the Client.

b) (Judicial State) The Contractor is authorized to litigate all standard judicial foreclosure claims and defenses. All foreclosure complaints shall contain a payer for possession as appropriate. If any case assigned to the Contractor results in a decision adverse to the Client, the Contractor must immediately notify the COR/PR, specify what must be done to preserve and protect the Client’s rights, and take no further action unless specifically instructed to do so in writing. The COR/PR will advise the Contractor whether and to what extent it has settlement authority. The Contractor must forward a copy of any foreclosure judgment to the COR/PR with the judgment interest rate and the foreclosure sale date. The COR/PR will notify the Contractor of the Client’s bid at least 24 hours prior to the sale. The Contractor must enter the bid on behalf of the Client when no other party has entered a bid or at the point in the bidding necessary to prevent the security property from being sold for less than the Client’s bid amount. All foreclosure sales will be subject to any outstanding prior liens, including real estate taxes and assessments, where State law permits. Third party purchasers may be given a reasonable time of no more than thirty calendar days to close a sale unless the COR authorizes additional time in writing.

c) (Non-Judicial State, Quasi-Judicial State) The Contractor must commence a non-judicial foreclosure and bring the security property to public sale in the minimum time permitted by Federal and State Law. All foreclosure sales will be subject to any outstanding prior liens including but not limited to real estate taxes and assessment; and all foreclosure actions shall contain an order for possession of the property by the purchaser. The Contractor must record, publish, post, mail and serve all documents required under State Law and provide the Point of Contact (POC) with a copy of the Notice of Sale. As soon as the foreclosure date and time are set, the Contractor will notify the Client POC as specified on the order. The Contractor must request bidding instructions from the Client at least 72 hours in advance which establishes the maximum bid the Contractor can enter on behalf of the Client. The Contractor is not authorized to bid on behalf of the Client without written bidding instructions from the Client. The Contractor must enter the bid on behalf of the Client and attend the Trustee’s Sale on behalf of the Client. In the event the Contractor is bidding at a senior lien holder’s trustee sale, the Client will provide bidding instructions and funds to support the Client’s bid. The results of the foreclosure sale must be reported in writing to the POC and COR within 48 hours of the sale.

d) (As applicable) A foreclosure is deemed complete:

(i) If the collateral was purchased by the Client, then when the Contractor provides the Client with:

1. A recorded deed,

2. A final report on the foreclosure, and

3. Certification of clear title; or

(ii) If the collateral was purchased by a third party, then when the contractor:

1. Transfers proceeds to the Client; and

2. Provides the COR with a report on the sale, including the purchaser’s name and address.

Upon completion, the Contractor will certify to the COR that the foreclosure complied with applicable law and that the purchaser received good, marketable title as appropriate. If a title defect is later discovered and is due to the Contractor’s error or omission, then the Contractor must correct the defect at no cost to the Client. However, the Contractor will not be responsible for any title defect existing prior to creation of the Client’s lien or to the Client’s failure to record a valid lien prior to contractor’s case assignment related to the subject property.

e) Uncontested Foreclosure means a foreclosure or power of sale proceeding conducted pursuant to Administrative Agent’s exercise of remedies under the Loan Documents, as to which Borrower (or any Affiliate thereof) has not contested or objected, and as to which Borrower (or any Affiliate thereof) has not filed any litigation or other legal proceeding that impedes or interferes with the efforts of Administrative Agent to exercise its rights and remedies under the Loan Documents.

In the event the foreclosure is contested, the Contractor is expected to work with the Client to complete all aspects of the contested foreclosure. A case is considered contested when the Contractor notifies the Client in writing of the case being contested.

(i) If a borrower files bankruptcy under Chapter 7 after a case has been assigned to the Contractor for foreclosure, then the Contractor must keep the foreclosure file open pending final disposition of the bankruptcy proceeding. Final disposition of a Chapter 7 proceeding means notification that the case has been dismissed, that the property has been abandoned, or that the debtor has been discharged. Upon final disposition of the bankruptcy, the Contractor must continue with the foreclosure.

(ii) If a borrower files bankruptcy under Chapter 11, 12 or 13 after a case has been assigned to the Contractor for foreclosure, then the Contractor must keep the foreclosure file open pending final disposition of the bankruptcy proceeding. Final disposition of a Chapter 11, 12 or 13 proceeding means notification that the case has been dismissed, that the bankruptcy plan (the “Plan”) has been confirmed or that the Contractor has obtained relief from the automatic stay. The Contractor must continue with the foreclosure if the bankruptcy case is dismissed or the automatic stay has been lifted. However, the foreclosure will be terminated, and the case will be reclaimed from the Contractor upon notification that the Plan has been confirmed and proof that the borrower has made at least 3 consecutive post confirmation payments to the Client.

f) Bankruptcy

i. The Contractor may be assigned cases for foreclosure that are currently subject to the Automatic Stay of a bankruptcy. Contractor must represent the Client in such bankruptcy case and continue or begin foreclosure proceedings once the bankruptcy stay is lifted, or relief is granted.

ii. The Contractor must within seven calendar days advise the COR when it becomes aware that a borrower has filed a petition in bankruptcy court. If the COR receives notice that a borrower has filed a petition in bankruptcy court, the COR will immediately notify the contractor. These notifications shall be by telephone, and confirmed in writing, by the COR or PR, within seven business days. The COR/PR reserves the right to assign to the contractor the duty of representing the Client in the bankruptcy proceeding. If the bankruptcy case is assigned to the Contractor, the COR/PR will advise the Contractor whether Client wishes to object to a proposed bankruptcy plan, petition for lifting of the automatic stay or request abandonment in order to continue liquidation. The contractor must prepare, and file all required documents within the time frame necessary to protect the Client’s security interest or take other action as requested. The contractor is authorized to represent the Client at hearings when necessary and to execute bankruptcy related documents on behalf of the Client. The COR/PR will provide the contractor with account balances and other information for completing documents. The Client will prepare and file proof of claim. A bankruptcy Phase I action is deemed to be completed when the case is confirmed, dismissed, the debtor is discharged by the bankruptcy court, the automatic stay is lifted, or Client has acquired title to the property. The contractor must provide the COR/PR with a copy of the court order confirming the plan with a letter explaining the payments to be made inside or outside of the plan, a copy of the court order dismissing the case, the notice of discharge or the order vacating the automatic stay before receiving payment for bankruptcy.

iii. The COR will notify the COR/PR when a borrower is delinquent 4 months or more in payments under the terms of a confirmed plan or when any other circumstances exist which provide a basis for a Motion to Vacate the Automatic Stay. The delinquency may arise from a borrower’s failure to make payments inside the plan or outside the plan. The Client reserves the right to assign to the contractor the duty of representing the Client at hearings in the bankruptcy proceeding. If the bankruptcy case is assigned to the Contractor, the COR/PR will advise the contractor when the Client wishes to petition for vacating the automatic stay. The Contractor must complete all bankruptcy documents along with the necessary information being provided by the COR/PR. A bankruptcy action is deemed to be complete when the motion to vacate stay is granted or denied or when the case is closed or dismissed by the bankruptcy court. The Contractor must, within 60 calendar days, provide the COR with a copy of the filed Motion to Vacate Stay, the court order granting or denying the Motion, and the notice of dismissal or closing.

2. Other Case Types and Related Actions.

a) When directed by the COR/PR in writing, the Contractor must recover physical possession of and secure the collateral, arrange for any occupants to be ejected, and deliver possession to the COR/PR in a timely and commercially- reasonable fashion.

b) When directed by the COR/PR in writing, the Contractor must seek a deficiency judgment for unsatisfied principal and interest balances plus all permitted penalties, costs, and attorney's fees, as appropriate. Interest shall be specifically requested at the maximum rate allowed law. The Contractor will take immediate steps to enforce a deficiency judgment.

c) When directed by the COR/PR in writing, The Contractor must ensure that any deficiency judgment entered is promptly recorded and perfected as a lien in the county in which the collateral is located and, in the county, where the borrower currently resides. The COR/PR may also direct that the judgment be recorded in any other jurisdiction where the borrower is known or believed to own property.

d) The Client will only seek a deficiency judgment (in those States where available) when foreclosure is initiated, and the Client determines the borrower has or will have assets from which a deficiency judgment could be recovered. Deficiency judgments will never be sought in the following situations: (1) acceleration is due to an unpaid recapture amount; (2) the borrower was granted a moratorium at any time during the course of the loan and faithfully tried to meet the loan obligations; (3) State law does not permit a personal deficiency; (4) in nonjudicial foreclosure States, the United States Attorney will not accept a referral for the deficiency; or (5) the Client has determined after consultation with OGC that it is not cost effective to seek a deficiency on a particular case.

e) Contractor must employ all reasonable enforcement methods permitted by applicable State and Federal law to affect collection. Collections from execution of judgments (from sale of assets or garnishments) shall be handled in accordance with Section A.6.

f) Foreclosure Mediation Program. Under state mediation programs, homeowners may elect a separate mediation hearing whereby the foreclosure is halted. Contractor will provide all actions required to complete mediation. The Contractor is required to represent the USDA through to the resolution. In many instances, multiple court hearings are required with contractor involvement. For the purposes of this effort the contractor must provide a mediation Firm-Fixed Price (FFP) per session with the stipulation that no more than four (4) sessions per case will be allowed without CO approval

g) North Carolina§ 45‑102. Pre‑foreclosure notice for home loans. Contractor will execute and deliver required notice. Client maintains an account with the North Carolina Housing Financing Agency (NCHFA). Client will provide contractor access to its account to complete required information, print, and deliver notices. Client will pay the fee required by NCHFA.

h) Arkansas Code Title 18. Property § 18-50-103 (AR103 Letter). If required, Contractor will create, draft, and deliver on its letterhead.

i) Pre-Default Information needed for Foreclosure. The contractor shall provide a comprehensive list for each state under this pilot that details all pre-default information needed from the Client to proceed with foreclosure. As identified in A7(d)a, contractor will evaluate case file prior to acceptance. If additional information is required from the Client, contractor will notify Client within three business days.

j) State Specific Documentation Required for Foreclosure. The contractor shall provide the client with a list of all required state-level documentation components required to execute foreclosure and sample copies of the documents in its program management plan (PMP). The PMP must also include a list of underlying data needed from the Client that maps to each identified component. The contractor is responsible for creation, delivery on its letterhead, filing, etc., of these components and associated costs (aside from the NCHFA fee) and shall be included in the foreclosure FFP. For these purposes, contractor responsibility to draft and deliver required notices begins for all actions after the Client has issued the formal notice of default. Unless new requirements are dictated by change in law or policy after contract award, the Client will bear no additional costs above the FFP to meet state-level requirements

k) Evictions. Contractor will perform all services required to complete the eviction, billed FFP per eviction and will be required in support of Foreclosure and REO properties. The contractor must notify the Client 10 business days in advance if a client’s official is needed on site to coordinate the eviction.

The client reserves the right to choose any or all combinations of services.

A.6. BIDDING AND PROCEEDS.

1. Establishing a Bid Amount. The Client’s bid will be the lesser of: Ninety percent (90%) of the Client’s gross investment, or Ninety percent (90%) of the estimated net recovery value of the security property. Gross Investment is the total amount USDA has invested in the loan, calculated as:

a) The unpaid balance: For judicial foreclosures, the judgment amount established by the court.

b) For non-judicial foreclosures, the borrower’s account balance, including secured loans and advances.

c) All outstanding advances and fees charged to the borrower’s account.

d) Any subsidy provided to the borrower.

2. Bidding at the Foreclosure Sale. Procedures for bidding will follow local requirements, and a local presence may be necessary. All proposed bid amounts must be submitted to and approved by the Client prior to the foreclosure sale.

3. The Contractor must properly handle all Client funds, whether obtained through foreclosure sale, enforcement of judgments, or otherwise. Payments to the Contractor made to satisfy obligations owed to the Client shall be made payable to "USDA, Rural Development" unless otherwise directed by the COR in writing. If payments owed to the Client are made payable to the Contractor, then the Contractor must endorse the items to "USDA, Rural Development" before remitting to the COR. The Contractor must make no deductions from such payments.

4. Enforcement of Judgments. The contractor shall take immediate action to ensure that any judgment entered is perfected as a lien in the county in which the security property is located and, in the county, where the borrower currently resides, if different. The Authorized Ordering Official may also direct that the judgment also be recorded in another county or jurisdiction where the borrower is known or believed to own real property. If during the handling of the case the contractor becomes aware of property owned by the borrower other than where the security is located, the contractor shall inform the COR of same and have the judgment recorded in that county or jurisdiction. The contractor shall mail or email a copy of any judgment entered to the COR within five business days after its entry. The contractor shall employ all enforcement methods permitted by applicable State and Federal law to effect collection. Collections from execution of judgments (from sale of assets or garnishments) shall be handled in accordance with Section C.6. In the event a judgment is vacated, written notice shall be mailed or emailed by the contractor to the COR/PR within five business days after its occurrence.

A.7. RECORDS OF CONTRACTOR ACTIVITY AND REVIEWS.

(a) The Contractor must maintain accurate time and cost records of its activities and provide monthly to the COR a status report of each case, including details regarding amendments to complaints, service on defendants, answers filed, and the filing of default and summary judgments. Where a bankruptcy petition has been filed, the report shall include the date the petition was filed, motions filed by the debtor, the date of confirmation or dismissal, and information regarding relief from automatic stay.

(b) Unless otherwise directed by the COR, within 15 business days of final completion of a case or reclaimed file in accordance with A8, the Contractor must transfer a hard copy paper file to the Client for the closed case to the address as instructed by the COR.

(c) The Contractor must make its case file available for inspection by the Client, the Client’s OGC or Government auditing agency(ies) upon request. The Contractor must also participate and cooperate in quality control reviews conducted by the Client, the Client’s Office of General Counsel, or Government auditing agency(ies), which may include interviews and site inspections in addition to records review.

(d) Data Reporting: Real time ad-hoc and monthly reporting for standardized data collection, reporting and analytics supporting pilot evaluation as detailed in A7(f).

(e) Contract management & coordination: Program management, coordination with USDA, ad hoc reporting, monthly program update, and single point of contact responsibilities.

(f) The contractor shall capture, maintain, and provide real-time data to the Client. This includes:

i. Quality of client transferred data to initiate foreclosure

ii. Estimated Property value

iii. Loan value

iv. Length of default by stage

a. Pre-foreclosure notice filings

b. Filing to Judgment

c. Judgment to sale

d. Sale to eviction/possession (if REO)

e. Borrower response behavior (Cure/Short Sale/Bankruptcy)

f. Auction bid strategies and outcomes

g. Status of buyer (corporation vs. individual)

h. Time to sell

i. Sold to 3rd party or Client

A.8. RETURN OF CASES/TERMINATION.

(a) The Client may terminate the representation for any reason or no reason, including, but not limited to, instances when in the Client’s sole judgment, foreclosure process is not being handled satisfactorily.

(1) Removed Cases: If termination is due to Contractor error, the Client will provide the Contractor with written notice of its decision to remove and its reason(s) for removing a case or cases from the Contractor’s representation.

(2) Reclaimed Cases: If termination is not due to Contractor error, the Client will provide the Contractor with written notice of the Client’s decision to reclaim.

(b) Upon removal or reclaiming of a particular case, the Contractor must take steps to the extent reasonably practicable to protect the Client's interests, such as obtaining extensions of time needed to employ other counsel and surrendering the case file.

(c) When a case is reclaimed, removed, or Deed-in-Lieu, the Contractor will bill a percentage of FFP that aligns with the milestone reached in Fannie Mae guidelines (https://servicing-guide.fanniemae.com/svc/e-5-05/reimbursing-law-firmsreimbursement-uncollected-fees-costs-or-advances) plus associated administrative fee. The total cost of the milestone claimed plus administrative fee shall not exceed the cost of the foreclosure FFP in the state. For recalled bankruptcy cases the process at A.13(2)(7) will apply. The Contractor must have no claim against the United States for any action taken by the United States after a case is removed or reclaimed. Return of a case shall not waive the Contractor’s continuing obligations under this agreement or applicable Rules and Regulations.

A.8.1 DEED IN LIEU.

The borrower may submit a Deed in Lieu request to either the Attorney or Client for consideration.

a) Client will determine if it is in the Client’s best interest to approve a Deed in Lieu request.

b) The Attorney may be required to order title work to identify any additional liens against the security.

c) Upon approval, the Attorney may be asked to complete additional title work to ensure the Client has clear title. The Attorney shall prepare, execute, and record a Warranty Deed signing the property over to the Client (submitting all documents to Client).

A.9. MALPRACTICE/INDEMNIFICATION.

The Contractor must maintain commercially reasonable malpractice insurance and promptly provide the Client with proof of such insurance upon request. Also, the Contractor shall indemnify and hold harmless the United States for all damages and defense costs that it might suffer or incur as a result of the Contractor’s professional negligence, intentional misconduct, or violations of law.

A.10. CONFLICT OF INTEREST.

The Contractor will comply with applicable Rules of Professional Conduct relating to Conflict of Interest.

A.11. LEGAL CONSULTATION.

The field staff of Office of General Counsel (OGC) shall be the contact for the COR and Contractor for any legal consultation necessary in connection with cases assigned under this contract. The primary OGC contact person(s) is:

TO BE DETERMINED

Office of General Counsel Regional Attorney, Central Region Email Phone

LEGAL CONSULTATION DOES NOT INCLUDE CONTRACTING AUTHORITY.

OGC contacts do not have contracting authority and are not authorized to request or agree to any contract modifications or change requests. If the Contractor believes that a legal consultation creates a modification or change request, then it must notify the Contracting Officer (CO). The Contractor may not act upon any modification or change request unless and until it receives written authorization from the Contracting Officer. Performing work without such authorization may result in the Contractor not being paid for such work.

A.12. CASES PENDING AT CONTRACT EXPIRATION/TERMINATION.

Cases previously assigned to the Contractor must be completed pursuant to the terms and conditions of the prior assignment. In cases of garnishment or collection of periodic payments, the Contractor must continue to receive and transmit to the Client such payments until full collection have been made unless otherwise instructed by the COR. The Contractor must continue to submit invoices for pending cases until their completion.

A.13. FIXED PRICE DESCRIPTION & INVOICING.

(a) Orders issued will be Fixed Price with rates established for Time and Material (T&M) Contract Line-Item Numbers (CLINs). Reimbursable items attributed to foreclosures services include, but are not limited to, publication services, deed restriction releases, taxes, and HOA fees. These items are reimbursable at cost with no additional overhead, G&A, or profit.

(b) Fixed Price Elements:

(1) Foreclosure Legal Services - All the activities required to accomplish a foreclosure action, including but not limited to attorney fees, normal overhead (e.g., travel, telephone, normal mailing expenses, overtime, fax, copying, and office space), title services, notifications, attorney demand letter, notice of intent, Statutory Pre-Suit Notice and all other tasks necessary to complete a foreclosure under State Law, Federal Laws, and Agency Regulations.

Judicial and Non/Quasi-Judicial Foreclosures: Acceptable file documentation will align with Fannie May standards up to the percentage being billed. (https://servicing-guide.fanniemae.com/svc/e-5-05/reimbursing-law-firmsreimbursement-uncollected-fees-costs-or-advances) For non-judicial foreclosure cases “final completion” is defined at Paragraph A.5 (a)(4).

The Contractor must invoice Foreclosure services as follows:

Judicial:

(i) Deliverable: Review of Title Report, forty percent (40% of fixed price).

(ii) Deliverable: Foreclosure sale held/Documents recorded, sixty percent (60% of fixed price).

Non-Judicial/Quasi-Judicial:

(i) Deliverable: Review of Title Report, sixty-five percent (65% of fixed price).

(iii) Deliverable: Foreclosure sale held/Documents recorded, thirty-five percent (35% of fixed price).

(2) Legal Services outside the Foreclosure: Contractor shall provide all required legal services outside the foreclosure process including but not limited to eviction and mediation, normal overhead (e.g., travel, telephone, normal mailing expenses, overtime, fax, copying, and office space), and title search costs are included in the Contractor's basic fixed price for legal services (the Contractor’s “Rate”).

(a) Over and Above Legal Fees: An hourly billable rate must be provided for over and above legal fees. All requests for over and above (O&A) legal fees must be submitted to the CO in writing before costs are incurred. Over and above legal fees cover extenuating circumstances such as opening estates, process servings, clearing of title issues, and other items that may prevent the foreclosure from moving forward. This includes post-sale legal and administrative services, including trustees, deeds, title documentation, and disposition-related legal services. The attorney must provide an estimate with breakdown of billable hours along with a description of the services to be performed to the COR for approval by the CO. This must be provided before any costs are incurred. All invoices shall be fully documented by including hourly time entries with descriptions of work performed, in 1/10th of an hour increment. All O&As may be invoiced directly upon completion of approved individual action.

(b) Legal Service (outside the foreclosure) Invoices: An hourly billable rate must be provided for all legal services, outside the foreclosure, invoices shall be fully documented including hourly time entries with descriptions of work performed, in 1/10th of an hour increment. Each invoice shall specifically identify relevant borrower and loan account(s), case names and numbers, and all other information required by the invoicing procedures. The available labor rates are fixed. Any invoice shall include increments calculated one-tenth (1/10) of the established hourly rate. All invoices shall be paid on the labor rate established in the contract.

(c) The Contractor must immediately notify the CO if it anticipates that an increase in the number of hours required for legal services outside the foreclosure; hours required for over and above legal fees; advertising; and/or reimbursables. The Contractor shall take no action until the CO has issued a Modification. Failure to obtain such approval will result in the Contractor being denied the additional costs more than the amounts established in the contract for these fees.

(3) Advertising or Publication Expenses: Certified Advertising Expenses for counties covered by the Contractor must be submitted for approval in spreadsheet format for acceptance by the Contracting Officer. Accepted Advertising Expenses shall be considered approved expenses and part of the Reimbursable Elements below. In the event the Contractor cannot provide a spreadsheet for approval of advertising expenses by county, the Contractor must not exceed a cumulative $4,000 per case in advertising or publications expenses. If the advertising or publication expenses exceed $4,000 for any case, submission of estimate and supporting documentation to the CO approval is required prior to incurring any expenses.

(4) Reimbursable Elements: Filing fees; title reports; asset search fees; recording fees; court costs; fees for document service where required by law; sheriffs, marshal's, constable's or other similar officials’ fees; any prior liens, including real estate taxes and assessments, which must be paid under applicable State law prior to the foreclosure sale date; title insurance when required by the COR or CO; the costs of securing the collateral and ejecting occupants; and other customary costs requisite to the action or judgment enforcement are cost reimbursable elements. The Contractor must not exceed $2,500 for cumulative reimbursable costs on a single case without prior written approval from the CO. Failure to obtain such approval will result in the Contractor being denied reimbursement for costs more than the stated not-to exceed limits. All reimbursables may be invoiced directly upon completion of approved individual action.

(5) Mediation: The Contractor shall provide Mediation Services to include performing mediation for homeowners under state specific mediation programs, if applicable, homeowners may elect a separate mediation hearing whereby the foreclosure is halted. The Contractor shall represent the Government through resolution. Mediation is invoiced upon completion.

(6) Eviction: The Contractor shall perform all services required to complete the eviction, in accordance with Agency Regulations; Local, State, and Federal laws; and with HB‐1‐3550. Evictions may be required at any point after the completion of the foreclosure or during the REO sale. Eviction is invoiced upon completion.

(7) Bankruptcy: The contractor shall perform all services required to complete bankruptcy in accordance with Agency Regulations; Loca, State, and Federal laws; and with HB-1-3550. Bankruptcy is invoiced upon completion. Should a bankruptcy referral be closed before completion, contractor will be reimbursed reasonable attorney fees related to the amount of legal work performed. This amount will not exceed the costs of the FFP for chapter 13 or chapter 7 in the state.

(8) The Contractor will be required to use the Client’s SharePoint to submit their monthly invoice and supporting documentation to the CO and COR. The invoice must include all elements identified in Attachment 3: Invoice Template.

A.14. PERFORMANCE REQUIREMENTS SUMMARY.

The reference for performance-based contracting requirements is RFO Subpart 37.1. To ensure that PWS requirements and the Client’s objectives are met, the COR and CO will conduct regular performance surveillance. The items identified in the table below are those that the client will evaluate to quantify Contractors’ performance level(s). The table includes information about the frequency of surveillance and any minimum satisfactory rating the Contractor must meet. If no rating is specified, the minimum requirement is 100% compliance or no unresolved discrepancies. The absence of any contract requirement from the PRS does not detract from its enforceability nor limit the rights or remedies of the Client under any other provision of the contract.

Performance Timeframes

Communication

*First Legal Actions to initial Foreclosure and reasonable diligence timeframes HUD.gov. https://www.hud.gov/sites/default/files/OCHCO/documents/40001-hsgh-Update-17.pdf

A.15. QUALITY CONTROL.

The Contractor must develop and maintain an effective quality control program to ensure services are performed in accordance with this PWS and will be included in the contractor’s Quality Control Plan (QCP). The Contractor must develop and implement procedures to identify, prevent, and ensure non-recurrence of defective services. The Contractor’s quality control program must ensure the quality of the work required and performed under the contract.

A.16. QUALITY ASSURANCE.

The Quality Assurance Surveillance Plan (QASP), attachment 4, specifies the roles, responsibilities, and methods of parties responsible for performance and evaluation of performance requirements listed in the Performance Requirements Summary (PRS).

A.17. CASE TRANSFER.

The Client will establish a file repository to facilitate transfer of loan documentation required for the contractor to initiate foreclosure. This process will require the contractor to use the eAuthentication/Login.gov process to register as a verified identity account.

A.18. ROLES AND RESPONSIBILITIES.

· Contracting Officer (CO): The CO shall appoint qualified people to inspect and accept services under the contract as Contracting Officer’s Representatives (CORs). The CO will resolve any disputes between Contractor and the COR.

· Contracting Officer’s Representative (COR): The COR is appointed by the CO and represents the CO during inspection and acceptance. The Contracting Officer’s Representative (COR) will be appointed to perform this function as specified in this contract.

· Contractor shall assign one individual project manager and one individual attorney to act as the Client’s primary point of contact and contractor’s decision authority for program related and legal related representation. Contractor is required to monitor its own employees and may report to Client regarding its quality control efforts.

A.19. CLIENT SURVEILLANCE ACTIVITIES.

These may include scheduled property and management inspections, audits and reviews of reports and financial records, and interaction with Contractor and Contractor’s employees. RD employees shall not direct Contractor to perform activities not specified in the contract. RD employees shall not direct Contractor’s employees.

A.20. PROVIDING FEEDBACK.

Regular verbal communication is highly encouraged to avoid escalating issues. Written documentation of conversations with Contractor shall be maintained in contract files. Contract performance reporting may be conducted as required by Federal Acquisition Regulations.

A.21. REMEDIES.

These include discussions with Contractor; Program Office servicing letters and/or notices; Negotiated payment decrease, if included in agreement; Contract termination; Government reporting of civil or criminal violation; Claims and appeals.