QASP-Secretary_Held.doc

Attachment 5

Quality Assurance Surveillance Plan (QASP)

Secretary Held Loan Servicing

12/28/2016

Version 1.0

31 Vision

1 INTRODUCTION

1.1 Purpose

1.2 Performance Management Approach

1.3 Performance Management Strategy

2 ROLES AND RESPONSIBILITIES

2.1 The Contracting Officer

2.2 The Government Technical Representative

3 IDENTIFICATION OF REQUIRED PERFORMANCE STANDARDS/QUALITY LEVELS

4 METHODOLOGIES TO MONITOR PERFORMANCE

4.1 Surveillance Techniques

4.2 Customer Feedback

4.3 Acceptable Quality Levels

5 QUALITY ASSURANCE DOCUMENTATION

5.1 The Performance Management Feedback Loop

5.2 Monitoring Forms

6 ANALYSIS OF QUALITY ASSURANCE ASSESSEMENT

6.1 Determining Performance

6.2 Reporting

6.3 Reviews and Resolution

6.4 Surveillance Matrix

Appendix 1 - Surveillance Matrix Appendix 2 - Corrective Action Report (CAR) Appendix 3 - Customer Complaint Record Appendix 4 - Performance Assessment Report (PAR)

Quality Assurance Surveillance Plan (QASP) Secretary Held Loan Servicing

1 Vision

Provide professional, effective, and comprehensive loan servicing for a variety of HUD held mortgage loans, notes, and security instruments while maintaining a high standard of customer service

1 INTRODUCTION

This Quality Assurance Surveillance Plan (QASP) is pursuant to the requirements listed in the Performance Work Statement (PWS) entitled Secretary Held Loan Servicing. This plan sets forth the procedures and guidelines the National Servicing Center will use in ensuring the required performance standards or service levels are achieved by the Contractor.

1.1 Purpose

1.1.1 The purpose of the QASP is to describe the systematic methods used to monitor performance and to identify the required documentation and the resources to be employed. The QASP provides a means for evaluating whether the Contractor is meeting the performance standards/quality levels identified in the PWS and the Contractor's Quality Control Plan (QCP), and to ensure that the Government pays only for the level of services received.

1.1.2 This QASP defines the roles and responsibilities of all members of the Integrated Project Team (IPT), identifies the performance objectives, defines the methodologies used to monitor and evaluate the Contractor's performance, describes quality assurance documentation requirements, and describes the analysis of quality assurance monitoring results.

1.2 Performance Management Approach

1.2.1 The PWS structures the acquisition around "what service or quality level is required", as opposed to "how the Contractor should perform the work" (i.e., results, not compliance). This QASP will define the performance management approach taken by National Servicing Center to monitor and manage the Contractor's performance to ensure the expected outcomes or performance objectives communicated in the PWS are achieved. Performance management rests on developing a capability to review and analyze information generated through performance assessment. The ability to make decisions based on the analysis of performance data is the cornerstone of performance management; this analysis yields information that indicates whether expected outcomes for the project are being achieved by the Contractor.

1.2.2 Performance management represents a significant shift from the more traditional Quality Assurance (QA) concepts in several ways. Performance management focuses on assessing whether outcomes are being achieved and to what extent. This approach migrates away from scrutiny of compliance with the processes and practices used to achieve the outcome. A performance-based approach enables the Contractor to play a large role in how the work is performed, as long as the proposed processes are within the stated constraints. The only exceptions to process reviews are those required by law (federal, state, and local) and compelling business situations, such as safety and health. A "results focus" provides the Contractor flexibility to continuously improve and innovate over the course of the contract as long as the critical outcomes expected are being achieved and/or the desired performance levels are being met.

1.3 Performance Management Strategy

1.3.1 The Contractor is responsible for the quality of all work performed. The Contractor measures that quality through the Contractor's own Quality Control (QC) program. QC is work output, not workers, and therefore includes all work performed under this contract regardless of whether the work is performed by Contractor employees or by subcontractors. The Contractor's QCP will set forth the staffing and procedures for self-inspecting the quality, timeliness, responsiveness, customer satisfaction, and other performance requirements in the PWS. The Contractor will develop and implement a performance management system with processes to assess and report its performance to the designated government representative. This QASP enables the Government to take advantage of the Contractor's QC program.

1.3.2 The Government representative(s) will monitor performance and review performance reports furnished by the Contractor to determine how the Contractor is performing against communicated performance objectives. The Contractor will be responsible for making required changes in processes and practices to ensure performance is managed effectively.

2 ROLES AND RESPONSIBILITIES

The following personnel shall oversee and coordinate surveillance activities.

2.1 The Contracting Officer

The Contracting Officer (CO) is responsible for monitoring contract compliance, contract administration, and cost control and for resolving any differences between the observations documented by the Government Technical Representative (GTR) and the Contractor. The CO will designate one full-time GTR as the government authority for performance management. The number of additional representatives serving as technical inspectors depends on the complexity of the services measured, as well as the Contractor's performance, and must be identified and designated by the CO.

2.2 The Government Technical Representative

The GTR is designated in writing by the CO to act as his or her authorized representative to assist in administering a contract. GTR limitations are contained in the written appointment letter. The GTR is responsible for technical administration of the project and ensures proper government surveillance of the Contractor's performance. The GTR is not empowered to make any contractual commitments or to authorize any contractual changes on the Government's behalf. Any changes that the Contractor deems may affect contract price, terms, or conditions, shall be referred to the CO for action. The GTR will have the responsibility for completing QA monitoring forms used to document the inspection and evaluation of the Contractor's work performance. Government surveillance may occur under the inspection of services clause for any service relating to the contract.

3 IDENTIFICATION OF REQUIRED PERFORMANCE STANDARDS/QUALITY LEVELS

The required performance standards and/or quality levels are included in the PWS and in Appendix 1, "Surveillance Matrix". If the Contractor meets the required service or performance level, it will be paid the monthly amount agreed on in the contract.

4 METHODOLOGIES TO MONITOR PERFORMANCE

HUD will develop a quality assurance plan to be used to provide contract oversight. The plan will include various methods of assessing performance, including 100% review of some documents and partial sampling of others. HUD also performs on-site or desk reviews based upon the risk category assigned to the Contractor. Quarterly on-site desk reviews will be conducted. However, HUD reserves the right to perform an on-site review at any time on any performance requirement in the contract without notice.

4.1 Surveillance Techniques

In an effort to minimize the performance management burden, simplified surveillance methods shall be used by the Government to evaluate Contractor performance when appropriate. The primary methods of surveillance are

· 100% Inspection - Each month, the GTR, shall review the generated documentation and enter summary results into the Surveillance Activity Checklist.

· Periodic Inspection - The GTR typically performs the periodic inspection on a monthly basis.

· Customer Feedback

4.2 Customer Feedback

The Contractor is expected to establish and maintain professional communication between its employees and customers. The primary objective of this communication is customer satisfaction. Customer satisfaction is the most significant external indicator of the success and effectiveness of all services provided and can be measured through customer complaints.

Performance management drives the Contractor to be customer focused through initially and internally addressing customer complaints and investigating the issues and/or problems. The customer always has the option to communicate complaints to the CO and/or GTR, as opposed to the Contractor.

Customer complaints, to be considered valid, must set forth clearly and in writing the detailed nature of the complaint, must be signed, and must be forwarded to the GTR.

Customer feedback may also be obtained either from the results of formal customer satisfaction surveys or from random customer complaints.

4.3 Acceptable Quality Levels

The Acceptable Quality Levels (AQLs) included in Appendix 1, "Surveillance Matrix", for Contractor performance are structured to allow the Contractor to manage how the work is performed. For certain critical activities such as those involving the desired performance level is established at 100 percent. Other levels of performance are keyed to the relative importance of the task to the overall mission performance.

5 QUALITY ASSURANCE DOCUMENTATION

5.1 The Performance Management Feedback Loop

The performance management feedback loop begins with the communication of expected outcomes. Performance standards are expressed in the PWS and are assessed using the performance monitoring techniques shown in Appendix 1.

5.2 Monitoring Forms

The Government's QA surveillance, accomplished by the GTR, may be reported using the following monitoring forms: Appendix 2 - "Corrective Action Report (CAR)", Appendix 3 - "Customer Complaint Record", and Appendix 4 "Performance Assessment Report" (PAR). The forms, when completed, will document the Government's assessment of the Contractor's performance under the contract to ensure that the required results are being achieved. The GTR will retain a copy of all completed QA surveillance forms.

6 ANALYSIS OF QUALITY ASSURANCE ASSESSEMENT

6.1 Determining Performance

The Government will use the monitoring methods cited to determine whether the performance standards/service levels/AQLs have been met. If the Contractor has not met the minimum requirements, it may be asked to develop a corrective action plan to show how and by what date it intends to bring performance up to the required levels.

6.2 Reporting

At the end of each month, the GTR/GTM will prepare a written report for the GTR summarizing the overall results of the quality assurance surveillance of the Contractor's performance. This written report, which includes the Contractor's submitted monthly report and the completed quality assurance monitoring forms, will become part of the QA documentation. It will enable the Government to demonstrate whether the Contractor is meeting the stated objectives and/or performance standards, including cost/technical/scheduling objectives.

6.3 Reviews and Resolution

6.3.1 The GTR may require the Contractor's project manager, or a designated alternate, to meet with the CO, GTM and/or other Government IPT personnel as deemed necessary to discuss performance evaluation. The GTR will define a frequency of in-depth reviews with the Contractor, including appropriate self-assessments by the Contractor; however, if the need arises, the Contractor will meet with the GTR as often as required or per the Contractor's request. The agenda of the reviews may include:

· Monthly performance assessment data and trend analysis,

· Issues and concerns of both parties,

· Projected outlook for upcoming months and progress against expected trends, including a corrective action plan analysis,

· Recommendations for improved efficiency and/or effectiveness,

6.3.2 The CO and GTR must coordinate and communicate with the Contractor to resolve issues and concerns regarding marginal or unacceptable performance.

6.3.3 The GTR and Contractor should jointly formulate tactical and long-term courses of action. Decisions regarding changes to metrics, thresholds, or service levels should be clearly documented. Changes to service levels, procedures, and metrics will be incorporated as a contract modification at the discretion of the CO.

6.4 Surveillance Matrix

The Surveillance Matrix (Appendix 1) is the list of performance objectives and standards that must be performed by the Contractor. This matrix details the method of surveillance the GTR will use to validate and inspect these performance elements. Inspection of each element will be documented in the GTR file.

Performance objectives define the desired outcomes. Performance standards define the level of service required under the contract to successfully meet the performance objective. The inspection methodology defines how, when, and what will be assessed in measuring performance. The Government performs surveillance, using this QASP, to determine the quality of the Contractor's performance as it relates to the performance element standards. The PRS should be used to form the foundation of the GTR's inspection checklist.

In evaluating the quality of contractor’s performance, the following performance ratings may be used.

Performance

Rating Criteria

Appendix 1 - Surveillance Matrix

PWS

AQL: 97% of all servicing correspondence is date stamped, imaged and attached at a loan level within 10 business days of receipt.

What: Servicing Files

How: Servicing files will be pulled by random sample from tasks completed in the month for loan level inspection. The servicing files will be compared to the system for validation.

Frequency: Monthly

Who: Monitoring Team

Standard(s): Inspection applies to all standards

N/A

AQL: No deviation to the standard.

What: Escalated Correspondence Log Report How: Monthly report to be reviewed Frequency: Monthly

Who: Monitoring Team

Standard(s): Inspection applies to all standards N/A

AQL: No deviation to the standard.

What: Governmental Inquiries Log Report How: Monthly report to be reviewed Frequency: Monthly

Who: Monitoring Team

Standard(s): Inspection applies to all standards N/A

AQL: No deviation to the standard.

What: COIs Completed How: Random Sample of Completed COIs for the month Frequency: Monthly

Who: Monitoring Team

Standard(s): Inspection applies to all standards N/A

AQL: 97% of the proof of claims were prepared accurately and within five business days from notification of the bankruptcy filing.

b) Standard: The Contractor shall image the proof of claims both prior to filing and upon receipt of recorded claim.

AQL: 97% of the proof of claims were imaged as required.

What: Bankruptcy Monitoring Report How: Report vs System of Record

Frequency: Monthly

Who: Monitoring Team

N/A

AQL: 97% of all new loans were boarded no later than two (2) business days from receipt.

What: New Loans Boarded How: System of record to SFDW Frequency: Monthly

N/A

AQL: 97% of the payoff requests were processed within two business days from receipt of request.

What: Payoff requests Report

How: Report review vs System of Record

Frequency: Monthly

Standard(s): Inspection applies to all standards.

For each percentage point below the standard, the disincentive is 1% of the Contractor's Invoice amount and applied to the quarter tested. In no event shall the disincentive exceed a maximum of 6% per quarter for applicable CLIN.

AQL: 97% of all payments were processed not later than the next business day after receipt.

What: Monthly Log of payments received How: Monthly Log vs OTCNet and Deposit Only Bank Reconciliation Frequency: Monthly

For each percentage point below the standard, the disincentive is 1% of the Contractor's Invoice amount and applied to the quarter tested. In no event shall the disincentive exceed a maximum of 6% per quarter for applicable CLIN.

b) Standard: Variance correction shall be corrected/cleared within fifteen (15) calendar days of identification.

AQL: No deviation to the standard.

What: Cash Reconciliation Report How: Review report vs OTCNET Deposit ticket and Cash Report Frequency: Monthly

N/A

AQL: No deviation to the standard.

What: Bank Statements and Reconciliation

How: Statement Review Frequency: Monthly

N/A

AQL: 97% of all releases shall be prepared, executed and submitted for recordation within fifteen (15) business days of notification that a release is needed.

What: Monthly Release Report How: Report review vs System of Record

Frequency: Monthly

For each percentage point below the standard, the disincentive is 1% of the Contractor's Invoice amount and applied to the quarter tested. In no event shall the disincentive exceed a maximum of 6% per quarter for applicable CLIN.

AQL: 97% of all release activity was documented at a loan level, in the appropriate servicing system within five (5) business days.

b) The Contractor shall correct and send rejected releases for recording with two (2) business days of receipt of reject.

AQL: 97% of all rejected releases shall be corrected and sent for recordation within two (2) business days of notification of reject.

What: Release report

How: Report review vs System of Record Frequency: Monthly

N/A

AQL: 97% submit write-off package within five (5) business days of notification.

b) Contractor shall correct complete the appropriate transaction within two (2) business days of receipt of approval.

AQL: 97% of all write-off transactions are completed within two (2) business days of receipt of approval.

What: Notification of Write-off needed

How: Review notifications vs approval and review System of Record Frequency: Monthly

N/A

AQL: 97% of all subordinations were processed within five business days of receipt.

b) Standard: The Contractor shall issue a notice of expiration to the requestor within five (5) business days of expiration date.

AQL: 97% of all notices were issued within five business days if applicable..

What: Subordination Request Report

How: Report vs System of Record Frequency: Monthly

Who: Monitoring Team Standard(s): Inspection applies to all standards

N/A

AQL: 97% of all occupancy letters were sent at least thirty calendar days prior to the anniversary of the occupancy certification due date.

What: Query Annual Occupancy Servicing Step How: System notes vs certifications sent Frequency: Monthly

N/A

AQL: No deviation to standard.

b) Standard: The Contractor shall generate a Good Bye Letter and send to borrower within 10 days of file transfer.

AQL: 97% of all Good Bye Letters are sent to the borrower within 10 days of file transfer completion.

What: Asset Sales PC List How: System of record vs List Frequency: Monthly

N/A

AQL: 97% of the violations were reported to the GTR/GTM within two (2) business days of the anniversary date.

What: Lien Search Report

How: Lien Search Report Vs System of Record

Frequency: Monthly

N/A

AQL: 97% of the 61-day notice letters and spreadsheets were accurately delivered by the tenth (10) business day of the month.

What: 61 Day Letters and Spreadsheets

How: Review Sampling Frequency: Monthly

N/A

AQL: 97% of the reimbursement request letters and spreadsheets were accurately delivered by the seventh (7) business day of the month.

b) Standard: Following expiration of Reimbursement Letter one (1) deliver accurate individual Reimbursement Request Letter two (2) and spreadsheets to the Servicer/Holder within seven (7) business days after expiration of the first letter.

AQL: 97% of the reimbursement request letter 2 and spreadsheets were accurately delivered within seven (7) business days after expiration of the first letter.

What: Reimbursement Requests

How: Review sampling Frequency: Monthly

N/A

AQL: 97% of all terminations were noted in the system within five business days of receiving the termination report.

b) Standard: Transfer due and payable terminations to FOC within fifteen (15) business days of receiving the termination report AQL: 97% of all terminations were correctly transferred to the FOC within fifteen (15) business days of receiving the termination report.

What: Termination Report How: Termination Report Vs System of Record

Frequency: Monthly

Who: Monitoring Team

Any deviation of the standard shall result in a disincentive of 1% of the Contractor's invoice amount for the CLIN and applied to the quarter reviewed. In no event shall the disincentive exceed a maximum of 6% per quarter for applicable CLIN.

*Standards A and B will be reviewed individually. If the performance is less than the standard on both elements, the Contractor’s invoice shall be charged for two (2) elements.

AQL: No deviation from standard.

b) Standard: The average wait time for all callers to speak to a Loss Mitigation specialist (warm transfer) shall be no more than two (2) minutes for 90% of all calls received for the quarter.

AQL: No deviation from standard.

c) Standard: All calls received outside of normal business hours where a voicemail was received shall be returned not later than 12 noon the next business day.

AQL: No deviation from standard.

What: Month End Report Review

How: Report Review

Frequency: Monthly

Who: Monitoring Team Standard(s): Inspection applies to all standards Any deviation of the standard shall result in a disincentive of 1% of the Contractor's invoice amount for the CLIN and applied to the quarter reviewed and the contractor shall bear the cost of the penalty and interest paid to the mortgagor. In no event shall the disincentive exceed a maximum of 6% per quarter for applicable CLIN.

Disincentive applies to Standard A only

AQL: For each validated complaint after the first five complaints, the Contractor shall be assessed a $200 disincentive for each complaint validated greater than five.

What: Complaints Received

How: Complaints Vs Disputes Frequency: Monthly

Who: Monitoring Team Standard(s): Inspection applies to all standards For each validated complaint after the first five complaints, the Contractor shall be assessed a $200 disincentive for each complaint validated greater than five.

AQL: No deviation to the standard.

What: Month End Report Review

How: Report Review Vs Documented Downtime

Frequency: Monthly

Who: Monitoring Team

Standard(s): Inspection applies to all standards The contract payment will be reduced by a percentage that is directly proportional to the percentage of time that the Contractor's telecommunications system was inoperable during the quarter. For example, if the system were down for any reason for 2 hours (120 minutes) during a quarter, the Contractors invoice would be reduced by 1% on the applicable CLIN as calculated as follows:

Operational Hours in Quarter = 750 [(3000 business hours for 2017 = 750 business hours or 45,000 business minutes per quarter)]

Downtime = 2 hours (120 Minutes)

Percentage of downtime = .003% (120 divided by 45,000 equals 1% rounded to nearest whole percentage). Reduction to Contractors monthly invoice = 1%.

Disincentive provisions relating to maintaining continuous telecommunications systems shall not be applied to specific events arising solely from Force Majeure conditions.

Appendix 2 - Corrective Action Report (CAR)

CORRECTIVE ACTION REPORT (CAR)

(If more space is needed, use reverse and identify by number)

1. CONTRACTOR

2. CONTRACT NUMBER

3. TYPE OF SERVICES

4. FUNCTIONAL AREA

5. SUSPENSE DATE

6. CONTROL NUMBER

7. DEFICIENCY FORMCHECKBOX

MAJOR FORMCHECKBOX

MINOR

FINDING:

FINDING IMPACT:

Please respond with a written corrective action plan that details the corrective action of the cited deficiency, the cause of the deficiency, and actions taken to prevent recurrence by Suspense Date in Block 5. If date was not entered in Block 5, the contractor is not required to provide a response.

8. QUALITY ASSURANCE PERSONNEL (COR)

TYPED NAME AND GRADE

SIGNATURE AND DATE

9. ISSUING AUTHORITY

TYPED NAME AND GRADE

SIGNATURE AND DATE

10. COR RESPONSE TO CONTRACTOR CORRECTIVE ACTION AND ACTION TAKEN TO PREVENT RECURRENCE

11. COR DETERMINATION

FORMCHECKBOX

ACCEPTED FORMCHECKBOX

REJECTED

12. CLOSE DATE

Appendix 3 - Customer Complaint Record

SOURCE OF COMPLAINT

ORGANIZATION

BUILDING NUMBER

INDIVIDUAL

PHONE NUMBER

NATURE OF COMPLAINT

CONTRACT REFERENCE

VALIDATION

DATE/TIME CONTRACTOR INFORMED OF COMPLAINT

ACTION TAKEN BY CONTRACTOR

RECEIVED/VALIDATED BY

Appendix 4 - Performance Assessment Report (PAR)

PERFORMANCE ASSESSMENT REPORT (PAR)

(If more space is needed, use reverse and identify by number)

4. QUALITY ASSURANCE PERSONNEL (COR) SIGNATURE AND DATE

I. PERFORMANCE

7. FORMCHECKBOX

DEFICIENCY (CHECK ALL BOXES THAT APPLY)

FORMCHECKBOX

NEW

FORMCHECKBOX

REPEAT

FORMCHECKBOX

NO DEFICIENCY NOTED

8. SERVICES SUMMARY or PWS PARAGRAPH ITEM REVIEWED

II. CONTRACTOR VALIDATION

11. CONTRACTOR REPRESENTATIVE FORMCHECKBOX

CONCUR FORMCHECKBOX

NON-CONCUR

12. CORRECTIVE ACTION ESTIMATED COMPLETION DATE

13. CONTRACTOR REPRESENTATIVE CORRECTIVE ACTION AND PREVENTION OF RECURRENCE OR REASON FOR NON-CONCURRENCE OF COR CITED DEFICIENCY

III. ACTION CORRECTED

14. FORMCHECKBOX

CONCUR FORMCHECKBOX

NON-CONCUR COR SIGNATURE AND DATE

15. COR REMARKS (REQUIRED)

6. CONTRACTOR REPRESENTATIVE REMARKS