MCM_Draft_PWS.pdf

Mortgagee Compliance Manager (MCM)

Performance Work Statement (PWS)

US Department of Housing & Urban Development

Office of Single Family Asset Management

Management and Marketing (M&M) Services: Third Generation

Mortgagee Compliance Manager

Performance Work Statement

1 GENERAL INFORMATION

1.1 BACKGROUND

This Performance Work Statement (PWS) describes the services required to assist the

United States Department of Housing and Urban Development (HUD) with ensuring

Lender compliance with property conveyance requirements for its Real-Estate Owned

(REO) portfolio.

The Federal Housing Administration (FHA), an organizational unit within HUD, administers the single-family mortgage insurance program. FHA insures approved lenders against the risk of loss on loans they finance for the purchase, and in some instances rehabilitation, of single-family homes. In the event of a default on an FHA insured loan, the lender acquires title to the property by foreclosure, a deed-in-lieu of foreclosure, or other acquisition method, files a claim for insurance benefits and conveys the property to HUD. As a result of acquisitions through the mortgage insurance program and other programs, HUD has a need to manage and sell a sizable inventory of single-family homes in a manner that promotes home ownership, preserves communities, and maximizes return to the FHA insurance funds. HUD is the largest single seller of real estate in the US.

HUD administers the REO disposition program through four, Homeownership Centers

(HOC) located in Philadelphia, Pennsylvania; Atlanta, Georgia; Denver, Colorado; and

Santa Ana, California. Each HOC is responsible for a designated geographic area.

Since 1999, HUD has been outsourcing the disposition of its REO inventory to

Management and Marketing (M&M) Vendors. This acquisition is part of the third generation of M&M services (M&M III). Under the previous generations of M&M contracts, HUD contracted with a single entity to provide all of the administrative, program support, management and marketing services throughout the United States, the

Caribbean, Guam and the Northern Marianna Islands. To ensure the continued success of its disposition program and to further capitalize on the private sector’s disposition expertise, in 2007 HUD conducted extensive market research on industry best practices surrounding the REO asset disposition process to structure the third generation of the contracting program, herein after referred to as M&M III.

Based on the results of the market research, for M&M III, HUD developed a new disposition structure for the management and marketing of REO inventory that will streamline its operations, capitalize on the expertise of its potential Vendors, and provide flexibility to meet changing market conditions in the real estate owned (REO) industry.

The key elements of the new task order structure include centralization of mortgagee compliance functions under a Mortgagee Compliance Manager (MCM) responsible for pre- and post-property conveyance activity including approval of claims for payment, title reviews, and inspection reviews.

1.2 ADMINISTRATION AND OVERSIGHT

There will be a HUD Contracting Officer (CO) and a HUD Government Technical

Representative (GTR) for MCM. The program area administration will be located at

National Service Center (NSC) in Oklahoma City.

1.3 PURPOSE AND OBJECTIVES FOR THE MORTGAGEE COMPLIANCE

MANAGER

The purpose of this task order is to obtain mortgagee compliance management services as detailed in 5.2. The Vendor shall perform a variety of pre- and post- property conveyance services to ensure that HUD's interests are protected. These services shall include reviewing property inspections to ensure the property is in conveyance condition;

resolving conveyance exceptions; providing guidance to Mortgagees related to pre-conveyance and post-conveyance responsibilities; and leveraging HUD’s software and information systems to execute and complete the tasks within this task order. Vendors shall use this information to propose a technical solution for each of the objectives listed below, and further detailed in 5.2. The technical solution shall consist of, but shall not be limited to, description of the procedures, documents, or reports that will be developed to meet the objectives.

HUD has identified four primary objectives for its mortgagee compliance program. They are to ensure that:

FHA insured properties are maintained in a manner that preserves communities and maintains the value of the property throughout the default and foreclosure phases;

Foreclosed properties are delivered to the Department in ‘conveyance ready’ condition, with good and marketable title, and within prescribed timeframes;

Actions taken by Mortgagees and the Vendor minimize risk and cost to the insurance funds.

The amount of interest HUD pays to Mortgagees is minimized by identifying inefficiencies throughout all aspects of the conveyance process and proposing solutions.

2 ACRONYMS, DEFINITIONS, ACQUISITION TYPES

2.1 ACRONYMS

ACRONYMS DEFINITION(S)

ACA Asset Control Area

ADP Asset Disposition Process

AM Asset Manager

BPO Broker Price Opinion

CFR Code of Federal Regulations

CO Contracting Officer

COOP Continuity of Operations Plan

DOA Delegation of Authority

FHA Federal Housing Administration

FOIA Freedom of Information Act

FSM Field Service Manager

GNND Good Neighbor Next Door

GTM Government Technical Monitor

GTR Government Technical Representative

HECM Home Equity Conversion Mortgage

HOA Homeowners Association

HOC Homeownership Center

HSFDS HUD Single Family Disposition Systems

HUD U.S. Department of Housing and Urban Development

IIR Initial Inspection Report

M&M Management and Marketing

MCM Mortgagee Compliance Manager

MWP Management Work Plan

NSC National Servicing Center

OM Oversight Monitor

P&P Preservation and Protection

PRS Performance Requirement Summary

PWS Performance Work Statement

QC Quality Control

QCD Quitclaim Deed

REO Real Estate Owned

SAMS Single Family Acquired Asset Management System

SFAM Office of Single Family Asset Management

SFIS or A43C Single Family Insurance System

PWS Performance Work Statement

SSA System Security Administrator

2.2 DEFINITIONS

Adverse Occupants – Occupants who are in possession of a HUD owned or

Custodial property without the legal right to be there.

Administrative Contracting Office Staff – The HUD officials authorized to execute and administer contractual documents based on this task order and who are also responsible for the day-to-day administration of this task order and delegating task order administration responsibilities to contracting staffs and Government Technical

Representatives.

Acquisition – The process through which a real property or mortgage note secured by a real property is conveyed to HUD. Properties and mortgage notes are conveyed

(acquired) from a number of sources. See Acquisition Types, 2.3.

Affiliated Entity - (a) As to Vendor, any Entity (i) controlling, controlled by, or under common control with the Vendor, or (ii) whose Management Officials are an

Immediate Family member of a Management Official of the Vendor; or (b) As to

Subcontractor, any Entity (i) controlling, controlled by, or under common control with the Subcontractor, or (ii) whose Management Officials are an Immediate Family member of a Management Official of the Subcontractor, including any agent or broker, licensed under a listing broker, used to list HUD-owned properties; or (c) As to any other Entity, any Entity (i) controlling, controlled by, or under common control with the other Entity, or (ii) whose Management Officials are an Immediate Family member of a Management Official of the other Entity.

Asset Control Area (ACA) Program – A program for the disposition to eligible participants of HUD-owned properties and future HUD acquisitions of properties and/or mortgage loans located within HUD designated revitalization areas.

Asset Manager – A HUD Vendor responsible for the marketing of HUD REO properties.

Broken Window – A pane of glass that has a visible opening that permits entry or exposure to the elements or which is so badly cracked as to constitute a hazard, e.g. a window with a crack that divides a single pane into two or more pieces.

Contracting Officer - The HUD official authorized to execute and administer a task order based on this PWS on behalf of HUD and includes any duly appointed successor or authorized representative.

Vendor – The individual, partnership, corporation or other entity, which is the party subject to the terms and conditions of this task order.

Control - The power to direct or cause the direction of the management and policies of such Entity, whether through the ownership of voting securities, by task order, or otherwise. The term “Controlled” shall have a correlative meaning (As to any

Entity).

Conveyance Condition - The standards a property has to meet to be considered ready for conveyance. This includes basic components for habitability and occupancy such as adequate heating and cooling facilities, electrical supply, cooking facilities, hot and cold water supply, sanitary facilities, and roof covering.

Cracked Window – A pane of glass that is still intact but may have slight imperfections that do not amount to an opening in the glass or do not constitute a hazard, e.g. a pane of glass that has been damaged but not broken and there is no danger of falling glass or weather damage to the property.

Custodial Property – A borrower owned property that serves as security for a secretary-held mortgage (including a HECM), which HUD, through the Vendor, has taken possession of following default and vacancy or abandonment.

Days – Calendar Days, (Unless otherwise specified in the Request for Quotation

(RFQ).

Default – When a mortgagor fails to perform under any covenant of the mortgage and the failure continues for thirty days.

Defective Performance – A service or deliverable that does not meet the performance standard specified in the task order for a specific performance requirement.

Electronic Data Interchange (EDI) -- Software application-to-application communication of data in standard format for business transactions, EDI is a set of standards for structuring information that is to be electronically exchanged between and within businesses, organizations.

Electronic Transmission – A message transmitted electronically in a format displayed on equipment, for example, a personal computer monitor or facsimile machine. The electronic media used to deliver electronic messages displayed on a personal computer monitor includes electronic mail or another method acceptable to

HUD.

Emergency Contact Sign - A visible sign on the property that provides a toll free, 24-hour telephone number to report emergencies.

Entity - Any individual, corporation, partnership, joint venture, Limited Liability

Company, trust, association, or any other entity.

FHA Connection – An Internet-based system that provides FHA business partners and Vendors secure interaction with HUD mainframe systems to perform required reporting and research the origination and servicing history of FHA insured loans.

Field Service Manager – A HUD Vendor responsible for property management, maintenance, and preservation services.

Financial Control Manual – A manual that describes HUD-Single Family Housing

Program's uniform policies and procedures for processing and approving vendor invoices related to Marketing and Management of HUD's properties. It also describes the minimum documentary evidence required of each type of Payment Request

Transmittal.

Government Technical Monitor (GTM) – A HUD employee who assists the GTR and may be delegated some duties of the GTR.

Government Technical Representative (GTR) – A HUD employee who acts as the

Contracting Officer's representative in all matters concerning the technical aspects of a task order. The GTR is responsible for giving Vendors technical advice and guidance related to the work required by the task order. Moreover, the GTR is the principal judge of a Vendor's performance, including the quality and timeliness of services.

Home Equity Conversion Mortgage (HECM) – A specialized mortgage product available only to senior citizens that allows them to receive cash payments from the equity in their home.

HUDCLIPS – A web-based directory of all of HUD’s official policies and directives including notices, Mortgagee Letters, Housing Notices, Handbooks, Code of Federal

Regulations and US Codes Titles 12 and 24. The Internet address for HUDCLIPS is:

http://www.hudclips.org/cgi/index.cgi.

HUD-Owned Properties - Properties that HUD owns by reason of payment of an insurance claim or another acquisition method. Unless otherwise indicated the term includes vacant land and occupied-conveyance properties. HUD-owned properties are also referred to as HUD REO or HUD-homes.

Immediate Family - As to any person and whether by blood, law, or marriage, (i) his or her spouse or registered domestic partner, (ii) his or her children, siblings, or parents, or (iii) the spouses or registered domestic partners of his or her children, siblings, or parents.

Management Official - As to any Entity, its owner, partner, principal, shareholder, director, officer, employee, agent, representative, or any individual who directs its daily operations.

Minimum Property Requirements (MPR) – A minimum quality level acceptable to

HUD for new construction of single-family housing. The requirements can be found in 24 CFR 200.926 through 200.926e.

Minimum Property Standards (MPS) – The minimum level of quality for existing, 1-4 unit properties to be considered technically acceptable for insurance under FHA programs. The standards for MPS are found in HUD Handbook 4905.1 Rev-1.

Mortgagee - An FHA approved mortgage loan holder or mortgage loan servicer.

Mortgagee is also referred to as “Lender”.

Mortgagee Compliance Manager – Vendor responsible for the mortgagee compliance services as defined by HUD.

Mortgagee Neglect – For a mortgage insured on or after January 1, 1977, the failure by a Mortgagee to inspect, or take reasonable action to preserve and protect a property securing an FHA insured mortgage, as required by 24 CFR 203.377.

Reasonable action includes initiating foreclosure within the required time frame pursuant to 24 CFR 203.355(b).

Non-Surchargeable Damage – Damage to the property that is not the responsibility of the Mortgagee because it was not caused by Mortgagee Neglect, fire, flood, earthquake, hurricane, tornado, or for condominiums, boiler explosions.

http://www.hudclips.org/cgi/index.cgi

Notice of Acquisition – The notice provided to the Vendor that a property has been assigned to them. Generally, notice is conveyed through P260. However, in some cases notice is delivered by the GTR.

Occupied-Conveyance - A formal process, as described in 5.2.2, through which a

Mortgagee receives permission to convey an occupied property to HUD. The term may also be used as a noun to refer to a property conveyed in this manner.

Pass Through Expense – An actual, out of pocket expense incurred and paid by the

Vendor that is not deemed a Vendor’s expense and which is listed in Attachment 3 as allowable pass-through expense.

Performance Evaluation – An annual written assessment of Vendor performance, conducted by a GTR or GTM.

Performance Requirement – Level of service/performance that separates acceptable and unacceptable performance of a task.

Performance Requirements Summary (PRS) - A list of contractual performance requirements the Government evaluates on a regular basis. Performance indicators, standards for these requirements, and surveillance methods will be used to determine if the Vendor meets performance standards.

Performance Standard - The Vendors level of performance required by the

Government. This is also known as the Acceptable Quality Level (AQL).

Possession – Upon completion of an eviction or any possessory action.

Proposed Rule - Proposed changes to the regulations governing HUD policy as published in the Federal Register.

Quality Assurance - Actions by the GTR/GTM and Contracting Officer to ensure that products or services provided by the Vendor are within the acceptable quality level for a given performance requirement.

Quality Control (QC) - Actions taken by the Vendor to control the production of supplies and services to ensure that they conform to the performance requirements and standards. Quality control procedures are outlined in the Quality Control Plan

(QCP) developed by the Vendor.

Random Sampling –The quality verification is a selection method, wherein each object in a group, has an equal chance of being selected for quality assurance surveillance.

Real Estate Owned (REO) – An industry term used to describe properties acquired through foreclosure of a mortgage note or deed of trust. Single-family properties owned by HUD may be referred to as HUD REO.

Re-conveyance - The process of returning a property to a Mortgagee by recording a deed in Mortgagee's name and seeking reimbursement for claims paid plus expenses.

Revitalization Area – An area that has been designated by HUD as exhibiting some or all of the following characteristics: a high concentration of HUD homes, low income or low homeownership rates or any other criteria HUD designates. HUD homes within revitalization areas are eligible for discounted sales to certain purchasers.

Revitalization Area Locator (RAL) - A web-based geo-mapping tool utilized as a

HUD’s official source for determining whether a property is located in a revitalization area.

Rework - Corrective action taken, or to be taken by the Vendor at its own expense and at no additional cost to the Government to rectify defects identified either by the

Government GTR or by the Vendor.

Secretary-Held Properties – Borrower owned properties that are the security for mortgage loans held and serviced by HUD either through assignment or origination.

Vacant or abandoned secretary-held properties will become Custodial Properties.

Secured Properties – A property where all windows, doors and openings are locked, boarded (where authorized), or otherwise secured to prevent unauthorized entrance by person or animal into any portion of the dwelling, including exterior entrances to crawl spaces, and any other structures on the property, e.g. garages and sheds.

Single Family Insurance System (SFIS or A-43C) – The Single Family Insurance

System (SFIS) is a HUD system of record used to maintain the insurance-in-force

(IIF) database, which contains accurate and detailed case information on FHA insured single family properties (except HECM). The Contractor shall access SFIS to verify loan information as deemed necessary to determine insurance status and clams information.

Special Property Inspections (SPI) – Quality assurance inspection of HUD properties performed by HUD contract inspectors or by a designated HUD official.

Subcontractor - A person or entity that enters into an oral or written contract or agreement with the Vendor to perform services, including a listing broker used by the

Vendor to list HUD-owned properties.

Surchargeable Damage – Damage to the property (1) by fire, flood, earthquake, hurricane, tornado, or, for condominiums, boiler explosion; or (2) for mortgages insured on or after January 1, 1977, damage caused by a Mortgagee’s failure, as required by 24 CFR 203.377, to inspect or take reasonable action to preserve and protect vacant or abandoned properties.

Targeted Sampling - Use of risk based factors rather than random sampling to select properties, files or other subjects for quality assurance or quality control review.

Task order Award Date - The date upon which HUD and the Vendor have both executed a task order based on this PWS.

Transition In Period – A period of time following task order award when a new

Vendor develops the infrastructure necessary to perform contractual responsibilities and when those contractual responsibilities are transferred from a Former Vendor to a new Vendor.

Transition Out Period – A specific period of time close to the end of the contract term where the incumbent Vendor executes an approved transition plan to assure continuity of service and a seamless transition to the next Vendor in accordance with the terms of the Contract.

Transmittal – Standard form required under HUD’s Financial Control Manual that

Vendors shall use to request payment of expenses associated with mortgagee compliance, management and the marketing of HUD-owned properties.

Utilities - Gas, electricity and water/sewer services.

Vacant Property Registration – State, municipal or local law that requires the registration of a vacant or abandoned property, until such time as the property is sold or otherwise disposed. A registration fee is usually associated with registration.

2.3 ACQUISITION TYPES

The vast majority of acquired properties are conveyed to HUD by a Servicing Lender

(Mortgagee) following foreclosure of an FHA insured mortgage and the filing of a claim for insurance benefits. However, HUD also acquires properties from a variety of other sources. The type of acquisition may impact the method by which the Vendor is informed of the new assignment and the scope of services required. A listing of possible acquisition sources follows.

Conveyance Foreclosures - Properties conveyed to HUD by a Mortgagee following foreclosure, or deed-in-lieu of foreclosure of an FHA insured mortgage, and the filing of a claim for insurance benefits.

Custodial Properties - Properties secured by a Secretary-Held mortgage or HECM, which are in default and upon inspection by HUD’s servicing Vendor determined to be vacant or abandoned. Title is not yet in HUD’s name. Upon receipt of notification from the GTR, the Vendor shall take possession to protect and preserve the property until title is acquired. Custodial properties are not marketable until foreclosure is completed and title is vested in the Secretary of HUD. These properties will be assigned by the GTR. Mortgagee compliance tasks are not required for these

Foreclosed Secretary Held Mortgages (SHMs) - Properties acquired as the result of the foreclosure of a mortgage serviced by HUD including assigned and purchase money mortgages. These properties will be assigned by the GTR. Mortgagee compliance tasks are not required for these properties.

Home Equity Conversion Mortgages (HECM) - A property acquired as the result of foreclosure of a reverse mortgage insured by FHA. These properties will be assigned by the GTR and will not be in SFIS. Mortgagee compliance tasks are not required for these properties.

Legal Settlement - Properties that are not FHA-insured but were acquired as a result of a lawsuit or for other reasons such as to accommodate another Federal agency.

These properties will be assigned by the GTR. Mortgagee compliance tasks are not required for these properties.

Repurchases/ Buy Backs – Properties repurchased by HUD to resolve a post sale claim by the purchaser of a HUD Home. The HUD GTR shall approve all repurchase requests. Mortgagee compliance tasks are not required for these properties.

184s – Properties on Indian or tribal lands acquired as a result of foreclosure of a loan guaranteed by HUD’s Office of Native American Programs under the Section 184, Loan Guarantee for Indian Housing Program of the Housing and Community

Development Act of 1992. These acquisitions may be lease-holds and have tribal specific resale restrictions. Mortgagee compliance tasks are not required for these

312s - Properties acquired as a result of foreclosure of a HUD Community Planning and Development’s Rehabilitation Mortgage. Notification of acquisition is provided by memorandum from the current servicer through the GTR. Mortgagee compliance tasks are not required for these properties.

3 GOVERNMENT PROVIDED GOODS AND SERVICES

3.1 INFORMATION SYSTEMS

The Vendor shall use the systems made available by HUD to perform on-going disposition activities as a source of data for the performance of this task order. These systems include all HUD provided systems that are used by Vendors engaged in the disposition of HUD’s REO portfolio, including any systems used by the MCM, AM and

FSM Vendors. The HUD provided systems/services are as follows:

3.1.1 SINGLE FAMILY INSURANCE SYSTEM (SFIS)

The Single Family Insurance System (SFIS) is HUD’s primary system of record for insurance and claim payment status of all FHA insured single family loans.

SFIS also includes the Single Family Insurance Claims Subsystem, A43C. Upon notification of an acquisition resulting from an insurance claim, the Vendor shall access SFIS to review insurance and claim data to meet the requirements of this

Performance Work Statement.

3.1.2 FHA CONNECTION

The FHA Connection is an Internet based system through which Mortgagees report the status of insured loans. Additionally, the FHA Connection allows HUD to post information of interest to Mortgagees. The Vendor may have to access this information to meet the requirements of the PWS.

3.1.3 P260 (ADAMS) ASSET DISPOSITION AND MONITORING

SYSTEMS

P260 is an Internet based system that will serve as the primary system of record for all REO case management transactions. This system will assign each HUD-owned property for Vendors to track the disposition activity from conveyance to sale. The system will also track pre-conveyance activities. This system integrates data from SFIS, FHA Connection, and SAMS Accounting.

3.1.4 SINGLE FAMILY ACQUIRED ASSET MANAGEMENT SYSTEM

(SAMS)

The Single Family Acquired Asset Management System (SAMS) is HUD’s primary system of record for tracking financial and accounting data for properties acquired by HUD.

3.1.5 COST ESTIMATOR SERVICE

A comprehensive HUD provided cost estimator and valuation service designed to provide repair, replacement or improvement costs to end users to effectively and efficiently estimate the cost of property preservation and repair. The estimator service shall contain precise, validated and localized building cost, with web-based access and real-time communication that is representative of local market costs, conditions and provides for integrated bids. Repair, replacement or improvement cost estimates shall consider labor, material, equipment, productivity rates, mark-up taxes and fringes for repair/maintenance work.

3.2 ACCESS TO HUD INFORMATION SYSTEMS

Vendor employees (including Subcontractors) who need access to HUD information systems shall undergo a background investigation. See Clause HUDAR 2452.239-70.

3.2.1 SECURITY ACCESS

Due to the sensitivity of property and vendor profile data access to HUD systems outlined in 3.1.1, 3.1.2, 3.1.3 and 3.1.4, shall be limited to individuals based upon their specific duties and the security of the system. As a condition of obtaining access, Vendor employees requiring access to HUD systems shall submit to the

GTR an original and one copy of completed Standard Form 85P, Questionnaire for Public Trust Positions, Optional Form 306 and 21-D258 Finger Print Chart within thirty (30) calendar days of task order award. Vendor staff may be required to provide other background information as deemed appropriate for the requested security access level. HUD may grant, deny, or revoke an individual’s access rights to a HUD system based upon the results of the security background check of the individual. The Vendor shall provide written notification to the GTR no later than one (1) business day of termination or resignation of any employee granted HUD systems access or when there is no longer a need for access to HUD systems by any Vendor employee. The Vendor shall maintain an up-to-date list that identifies task order employees with access to each of the information systems described in 3.1.1, 3.1.2, 3.1.3 and 3.1.4, and the justification for each employee’s level of access. The Vendor shall not provide access to individuals until HUD provides written authorization.

3.2.2 SYSTEMS ACCCESS AUTHORIZATION

Subject to any necessary security clearances, HUD will grant the Vendor authorization to access the HUD information systems, including the Single

Family Insurance System (SFIS), Single Family Acquired Asset Management

System (SAMS), FHA Connection, the HUD provided cost estimation service, and the P260.

3.3 HUD PROVIDED TRAINING

During the Implementation Period, HUD will provide training to the Vendor to include its key personnel and staff. The training will be on policy, processes and systems usage.

There will be no cost for the training except that the Vendor will be responsible for travel and lodging expenses incurred by its staff attending the training. The training will be provided during the implementation phase after post award to ensure that the Vendor is familiar with all relevant systems and processes. The training location will be either in the Washington DC Metropolitan area or Oklahoma City, Oklahoma which will be determined after task order award and will involve the following:

P260 Training: High level training on the P260 and system data usage.

SAMs Training: High level training on SAMs and system data usage.

Cost Estimator Service: High level training on service usage

FHA Connection: High level training on system usage.

SFIS: High level training on system usage.

Policies and Procedures: Detailed training on HUD policies and procedures surrounding the asset disposition process.

3.4 APPLICABLE DOCUMENTS

Many of the applicable documents, handbooks, forms, user guides, and other policy documents referenced in this PWS are publicly available on the Internet at the sites identified in Attachment 2 – Applicable Documents.

4 VENDOR PROVIDED GOODS AND SERVICES

4.1 GENERAL

Except as otherwise expressly provided in this PWS, the Vendor shall provide everything required to perform the services under the task order based on this PWS. The

Vendor is responsible for knowing what items to furnish without specific mention.

4.2 VENDOR EXPENSES

All costs of performance under a task order based on this PWS are at the expense of the

Vendor unless otherwise specifically identified in this task order.

4.3 INTERFACE EQUIPMENT AND SOFTWARE

To provide capability for direct data entry and data review from the designated HUD systems, the Vendor shall provide equipment that meets the minimum requirements discussed in this section.

All personal computer configurations shall be in accordance with HUD’s minimum personal computer system configurations in effect at the time of task order award. Also all parties will ensure compatibility with the HUD network. The website link is http://www.hud.gov/offices/cio/sdm/devlife/def/newstand.cfm.

If such configurations change during the term of this task order, HUD must notify the

Vendor by letter of subsequent configurations and the effective date of any such change.

Scanner Hardware Information

Configuration of scanner will automate information capture from scanned paper or imported electronic documents. Based on criteria (HUD will provide) for different documents, the entire document or extracted data is digitized, and then routed to a database. Hardware and or software requirements will be added to statement to provide recognition engines and image enhancement features to ensure accuracy, reducing or eliminating the need for manual entry and oversight.

High Speed Internet Service is required.

4.4 VENDOR PROVIDED TRAINING

The Mortgage Compliance Manager (MCM) shall be responsible for training individuals designated by the GTR or CO on any internal systems, processes, tools and documents that will be used for the management process. The MCM shall also be responsible for providing training to HUD and designated individuals whenever internal systems or process changes occur. The MCM shall bear the cost of the training and materials used.

The MCM shall plan to provide training to approximately 6 people at the vendor’s facility in Oklahoma City, Oklahoma.

4.5 SYSTEMS SECURITY ADMINSTRATOR

The Vendor shall designate a Systems Security Administrator (SSA) no later than ten calendar (10) days of the effective date of the task order and provide this information to the GTR within this timeframe. SSA shall complete the mandatory HUD’s specialized on-line security training course designed for this position. The SSA shall use forms provided by HUD to initiate requests for user access to HUD IT systems and to request access modifications and deletions. The Vendor shall certify, not later than twenty (20) business days from the effective date of the task order and ongoing seven (7) business days from new hire, that all staff has received instruction in system security issues, are familiar with the contents of the current version of HUD Handbook 2400.24 Rev. 2, Information Security Program. The SSA will also be subject to HUD’s IT General

Controls and Monitoring of Vendors security policy. The SSA shall conduct annual security-self assessments and content will be subject to verification by facility inspections to ensure compliance with all HUD’s IT security policies.

5 DESCRIPTION OF SERVICES

5.1 GENERAL REQUIREMENTS

The Vendor shall perform a variety of pre- and post- property conveyance services to ensure that HUD's interests are protected. Such services consist of, but are not limited to, reviewing property inspections to ensure the property is in conveyance condition; verify that good and marketable title is conveyed to HUD; resolving conveyance exceptions;

providing guidance to Mortgagees related to pre-conveyance and post-conveyance responsibilities; and leveraging HUD’s software and information systems to execute and complete the tasks within this task order. The Vendor shall work cooperatively with the

Mortgagees and all other Vendors within the M&M III disposition structure to resolve and/or jointly craft remedies to specific and unique conditions that routinely arise within the purview of mortgagee compliance functions.

5.1.1 INFORMATION MANAGEMENT

The Vendor shall meet the information management and information transfer requirements in this PWS. The Vendor shall have access to HUD owned or HUD designated central information management systems. These system(s) shall be the central and primary sources of information for the execution of the Vendor’s responsibilities.

5.1.1.1 - HUD PROVIDED INFORMATION SYSTEMS

The Vendor shall use the systems made available by HUD (See

3.1) to perform on-going activities related to execution of the tasks within the task order. The Vendor shall provide individuals with security clearances and training, including any requested training materials, required to access the HUD provided systems.

5.1.1.2 - DAILY POSTINGS OF RECORDS

The Vendor shall update P260 with all records of actions taken for Mortgagee compliance promptly upon occurrences. HUD will have the ability to view daily activity associated with mortgagee compliance activities on a real-time basis.

5.1.1.3 - EXTERNAL IMAGE REVIEW

The Vendor shall review and verify receipt of all relevant electronic images and external information related to the verification of mortgagee compliance with property conveyance.

5.1.1.4 - IMAGING

The Vendor shall upload electronic images of all required property related documents that have not been electronically transmitted by other parties to P260 no later than twenty-four

(24) hours following receipt or creation by the Vendor.

5.1.1.5 - DOCUMENT SCANNING

The Vendor shall scan and upload into the HUD provided central data repository system all hard copied documents received or created during the course of processing a property into HUD’s

REO portfolio no later than twenty-four (24) hours following receipt or creation by the Vendor.

5.1.1.6 - DATE STAMP

The Vendor shall date stamp all incoming correspondence with the date the document was received in the Vendor’s office.

5.1.1.7 - PHYSICAL FILE MAINTENANCE AND RETENTION

The Vendor shall establish and maintain a physical property file for pre-conveyance activities including requests for extensions, overallowables and any supporting documentation related to pre-conveyance activities. The Vendor shall adhere to all current

HUD regulations and directives on file retention and storage requirements as described in Handbook 2225.6 Rev.1 Chg 52, HUD Records Disposition Schedules, Appendix 7, “Records

Relating to Property Disposition”, or subsequent policy directive.

On a periodic basis as determined by the GTR, the Vendor shall mail all physical files for those properties that have completed the conveyance process to the RPM Vendor for record retention.

5.1.1.8 - DELIVERY OF FILES UPON REQUEST

Unless otherwise specified, the Vendor shall, no later than five

(5) business days from receipt of a written request from the

Contracting Officer or GTR, deliver to HUD complete, accurate, legible, and accessible copies of the requested electronic or physical files.

5.1.1.9 INFORMATION SECURITY

Neither the Vendor nor any of its employees or affiliates shall disclose or cause to be disseminated any information relating to the services hereunder to any person not entitled to receive it.

Failure to safeguard any sensitive information that may come to the Vendor or any person under his/her control in connection with work under this PWS, may subject the Vendor or its agents or employees to criminal liability or termination for default.

5.1.2 OFFICE FACILITIES

The work shall be performed at the Vendor’s facility which shall be located within 50 miles of the Oklahoma City Federal Building, 301 N.W 6 th

Street, Oklahoma City, Oklahoma 73102.

5.1.3 CUSTOMER SERVICE

The Vendor shall ensure that all contact with the public and HUD employees promote HUD’s objectives under this PWS encourage participation by industry professionals, and result in a high level of customer satisfaction. Customers for the purpose of this PWS include: Mortgagees, designated Mortgagee vendors, HUD employees and HUD Vendors under the M&M III structure. Customer service includes, but is not limited to, answering questions; resolving complaints;

providing property information and status; crafting remedies and solutions, providing guidance, and coordinating with the Mortgagee as appropriate, and providing copies of property related documents in a prompt, professional and courteous manner.

5.1.3.1 - BUSINESS HOURS

The Vendor shall be open for business during normal business hours, 7 AM to 7 PM Central Standard Time.

5.1.3.2 - RESPONSE TIME

The Vendor shall provide prompt, courteous and accurate response to all inquiries. The Vendor shall respond to telephone inquiries no later than one (1) business day of the date the call was placed to the

Vendor’s office or the expiration of such shorter or longer period of time expressly authorized or required by this PWS. The Vendor shall respond to written and electronic inquiries no later than two

(2) business days following receipt of the inquiry or the expiration of such shorter or longer period of time expressly authorized or required by this PWS.

5.1.3.3 - COMMUNICATION LOG

The Vendor shall utilize the P260 communication log to track, monitor and resolve the internal and external communications for each REO property during the disposition program. This case number specific log will also include automated entries and will be a central repository but not limited to complaints, requests, approvals and the corresponding resolutions.

5.1.3.4 - FREEDOM OF INFORMATION ACT

The Vendor shall be familiar with the Freedom of Information Act

(FOIA) (Title 5 U.S.C. § 552) and the Privacy Act (5 U.S.C. §

552a) and shall assist HUD in responding to requests for information. The Vendor shall forward all requests for information that are subject to FOIA or the Privacy Act to the NSC GTR, within twenty-four (24) hours of receipt. In the case of a FOIA request that involves costs to the requestor, the Vendor concurrently shall provide a cost breakdown to the GTR.

5.1.3.5 - GOVERNMENTAL INQUIRIES

The Vendor shall notify the GTR within twenty-four (24) hours following receipt of any request for information from an elected or public official and shall, no later than two (2) business days of said request, provide written information to assist HUD in preparing a response.

5.1.3.6 - OTHER CORRESPONDENCE

The Vendor shall provide written information to the GTR or other designated HUD representative no later than five (5) business days of HUD's request for information required to respond to correspondence related to mortgage compliance issues.

5.1.3.7 - LITIGATION

The Vendor shall not represent that it is authorized to accept service of process on behalf of HUD. However, if the Vendor receives any pleading naming HUD as a party, the Vendor shall provide the GTR or other designated HUD representative with a copy of such pleading no later than one (1) business day after receipt of the pleading.

5.1.4 DELEGATION OF AUTHORITY

Authority to execute documents on behalf of the Secretary of HUD will be delegated to specific individuals identified by the Vendor and approved in writing by the NSC Director, subject to a Delegation of Authority (DOA) executed on behalf of the Secretary by the Assistant Secretary for Housing, Federal Housing

Commissioner. To provide public notice of the delegation, HUD will publish the

DOA in the Federal Register. Additionally, HUD will maintain a web page on which a copy of the DOA and the names of authorized individuals will be listed.

HUD staff will continually update the web page as OA’s are added and deleted.

Only those individuals whose names appear on the website are authorized to execute documents on behalf of the Secretary of HUD.

Within five (5) calendar days of receipt of a request of the GTR, the Vendor shall provide a spreadsheet that identifies those employees who require the DOA, including their job title and social security number. Following receipt of the spreadsheet, HUD staff will draft a letter of delegation; forward the executed letter with a copy of the Federal Register Notice to the Vendor and post the names on the website.

The Vendor shall notify HUD in writing within two (2) calendar days of termination, departure, death, or reassignment of any individual who has been granted a DOA, and will take every measure necessary to ensure that unauthorized persons do not utilize the DOA. Should it be necessary to add individuals to the delegation, the Vendor shall provide written notice to the GTR.

Upon receipt of an amended delegation letter and concurrent with posting the individuals name on the website, the DOA will be effective.

DOAs expire only upon revocation by HUD or at expiration/termination of the task order. It is not necessary to reissue DOA’s annually as task order options are exercised, however from time to time; the GTR may require that the Vendor recertify the list of individuals to whom DOA has been granted.

5.1.5 QUALITY CONTROL PLAN (QC)

5.1.5.1- QUALITY CONTROL PLAN

The Vendor shall develop, maintain and implement a comprehensive Quality Control (QC) Plan consistent with the

Quality Control Plan submitted during the bid process. The Vendor shall submit the Quality Control Plan to the CO and GTR within ten (10) business days after Post-Award conference. Upon receipt of comments from the GTR, the Vendor shall submit to the GTR revised QC Plans incorporating all comments within five (5) business days. The QC Plan shall be revised as circumstances dictate, to reflect necessary changes throughout the term of the task order. Prior to implementing changes, the GTR shall receive all changes to the QC Plan in writing for review and comment and shall respond to any and all changes to the QC Plan within five (5) business days of receipt. The Vendor shall maintain the QC Plan throughout the contractual term or as otherwise required in transfer to HUD or another Vendor, if needed.

The Vendor’s QC Plan shall ensure that all aspects of this PWS, in accordance with the performance standards listed herein, are performed completely and appropriately, and shall contain a plan for corrective action when deficiencies or insufficient performance are identified. The QC Plan shall be designed and implemented to result in quality and timely task order performance.

The QC Plan shall, at a minimum, include a detailed inspection oversight program covering all general and specific tasks; specify tasks or areas to be inspected on either a scheduled or unscheduled basis including the manner in which inspection is to be conducted;

a description of the techniques to be employed for producing and validating services and deliverables that conform to the acceptable quality standards in the task order; a description of the “checks and balances” that shall be used to ensure an acceptable level of quality; provisions for responding to technical directions and comments; and provisions that will be used to prevent and eliminate the potential for fraud, waste and abuse of HUD funds or other funds and resources received in the performance of this task order.

5.1.5.2 - QUALITY CONTROL REVIEWS

The Vendor shall conduct regular quality control reviews in accordance with its QC plan and, no later than the tenth (10) calendar day of each month; provide the GTR with a monthly report summarizing the results of its QC actions and findings including any policy, procedural, personnel or system changes or corrective actions taken as a result of the QC findings.

5.1.5.3 - QUALITY ASSURANCE REVIEWS

When defective performance is noted through HUD’s quality assurance activities, HUD may request that the Vendor correct the defective performance in writing. The Vendor shall, no later than five (5) business days following receipt of HUD’s notice of defective performance, respond in writing to this request, describing the corrective actions taken, or to be taken, and when any outstanding corrective actions shall be completed. If corrective action is not possible, HUD reserves the right to take other remedies permitted by the task order.

5.1.6 COMPLIANCE WITH LEGISLATIVE, REGULATORY AND

POLICY REQUIREMENTS

The Vendor shall comply with all Federal, state or local laws or regulations pertaining to the activities described in this PWS. When local laws and regulations conflict with HUD requirements, the Vendor shall notify the GTR and the Contracting Officer.

5.1.7 HUD’S APPROVAL AND ACCEPTANCE RIGHTS

5.1.7.1 - WRITTEN APPROVAL

The GTR or CO will provide electronic approval through HUD systems by the expiration of such period of time expressly authorized by this PWS. Where approvals are not provided through the system, the GTR will provide approval in writing unless otherwise stated in this PWS. Unless the PWS specifically authorizes oral communications, the Vendor acknowledges that oral communications do not constitute approval, consent or authorization, and if it proceeds without written approval, consent or authorization, it accepts the risk of proceeding.

5.1.7.2 - EFFECT OF APPROVAL

Notwithstanding the rights of approval and acceptance reserved to

HUD, the Vendor shall be solely and primarily responsible for the performance of every requirement in this PWS. Neither the reservation nor the exercise of HUD’s approval or acceptance rights shall be deemed to relieve the Vendor from its responsibility or to create any liability by HUD to the Vendor or third parties, with respect to the performance of the PWS requirements.

5.1.8 CONTINGENCY PLAN

The Vendor shall develop, maintain and implement, a Contingency Plan that addresses the gravest as well as the most likely problems that might arise and the

Vendor’s planned response to the adverse events. At a minimum, the plan shall cover: Subcontractor default; recovery from natural disaster as it affects the

Vendor’s operation; employee strike; and civil disorder. The Vendor shall provide the GTR and Contracting Officer with the Contingency Plan no later than forty-five (45) days after Task Order award for review and acceptance. After review, the GTR and/or CO shall accept the CP or provide review comments to the

Vendor’s CP, within fifteen (15) business days of receipt. Changes to the

Contingency Plan shall be accepted in writing, within fifteen business days by the

GTR prior to implementation.

5.1.9 LIEN RELEASES

The Vendor shall not, in connection with any work done or claimed to have been done by or on behalf of the Vendor, create, place, permit to be created or placed, or allow to remain any mechanic’s, laborer’s, or material man’s lien (collectively, a mechanic’s lien) against any property.

5.1.10 WRITTEN NOTICE

Except as otherwise provided herein, all references to delivery or receipt of written notice between the Vendor and Third Parties shall, subject to the listed exceptions, include notice delivered or received by electronic transmission. If

HUD permits electronic transmissions between the Vendor and a Third Party other than HUD, the transmissions shall comply with any standards HUD issues.

5.1.11 CONFLICTS OF INTEREST

5.1.11.1 - GENERAL RULE

The Vendor shall not engage in or permit any conflicts of interest prohibited under applicable law.

5.1.11.2 - NOTICES

The Vendor shall notify the GTR of any actual or suspected conflict of interest or the attempted purchase or lease by any

Entity under task order with HUD who prepared reports used as the basis for the List Price or to accept a bid.

5.1.12 ELECTRONIC DISCLOSURES, RECORDS, AND SIGNATURES

With respect to Federal law, the Vendor shall comply with the Electronic

Signatures in Global and National Commerce Act, 15 USC §§ 7001-7006, (ESIGN), including the requirements to, prior to electronically delivering information to a consumer, provide the consumer with certain disclosures and obtain the consumer’s consent to electronically receive information. The Vendor shall provide consumers with the option of requesting a paper copy of an electronic record and shall not charge any fee for such copy. The Vendor shall not use 15 USC § 7001(c) (3) to evade compliance with 15 USC § 7001(c) (1) (C)

(ii). With respect to State law, the Vendor shall comply with ESIGN or, if a State has enacted a statute, regulation, or other rule of law preempting ESIGN pursuant to 15 USC § 7002, the State statute, regulation, or other rule of law governing the use or acceptance of electronic…