PWS 1.4.2023 SAM.docx

1. CLIN 0001 SERVICE PRICE (and corresponding CLINS for each option period) The Contractor shall be paid a fixed unit price per loan serviced during the month invoiced. For example:

Month 1: 175,000 Assigned Loans serviced x $1.00 unit price per loan = total monthly invoiced $175,000.00 Month 2: 180,000 Loans serviced x $1.00 unit price per loan = total monthly invoiced $180,000.00 The monthly service price shall be compensation for all requirements not elsewhere specified including but not limited to all labor and other costs related to servicing all loans in the portfolio, tasks completed on uninsured loans, updating the service to accommodate policy, legislative or regulatory changes required to service all loans in the portfolio and relating to any of the tasks in this PWS.

3. REIMBURSEABLES

HUD will reimburse the Contractor for only the following expenses upon presentation of an approved invoice and adequate supporting documentation without prior approval by the COR. Any dispute as to whether an expense is to be reimbursed will be forwarded to the Contracting Officer for resolution.

· Actual recording fees associated with filing release documents are reimbursable and must be approved monthly by the COR.

· Actual cost of title search, abstracting fees, and recording fees associated with Deed-in Lieu (DIL).

· Actual cost of title search or title records report, as requested by the COR.

· Actual costs of appraisals that are requested by the COR.

· With authorization from the Contracting Officer, boxes used for archiving files at the Federal Records Center can be purchased from approved suppliers at the government price.

· Reimbursement of other disbursements must be pre-approved by the COR prior to incurring the expense.

· One Time Reimbursable are those expenses that occur only once and are necessary at the beginning of the contract or paid as Transition n costs. They include the following: Initial contractor employee training but not recurring training after the transition period is over; Contractor employee travel to initial training but not travel after the transition period is over; Office set-up expenses such as space build out, IT installation, etc. but not recurring monthly lease or phone bills; Moving of all the fireproof file cabinets from the former contractor's office site to the new contractor's office site; it does not include: Computer equipment, phones, or furniture; lump sum insurance, employee bonuses, or other similar expenses

4. Pricing Schedule 3 Month Base Period

Estimated Quantity

(HUD estimates that an average of 205,000 loans will be serviced during base period but the # of loans could range from 1 to 300,000 loans 1-300,000

Estimated NTE

Government Provided

TOTAL ESTIMATED PRICE FOR BASE PERIOD

· *For the purposes of calculating the Total Annual Price please use the estimated monthly quantity of 205,000 loans serviced.

9 Month Option Period 1

Estimated Quantity

(HUD estimates that an average of 220,000 loans will be serviced during option period 1 but the # of loans could range from 1 to 300,000 loans serviced per month during option period 1)

1 – 300,000

Estimated NTE

Government Provided

TOTAL ESTIMATED PRICE FOR OPTION PERIOD 1

Transition Out

Estimated Quantity

1. BUSINESS NEED

The National Servicing Center (NSC), a Headquarters' Division of the Office of Single Family Housing Asset Management (OSFAM), in the U.S. Department of Housing and Urban Development (HUD), is seeking to obtain professional loan servicing support services to perform a wide range of FHA Insured and Secretary-held HECM Assigned note and mortgage loan servicing functions. The servicing functions support the following loan programs: Home Equity Conversion Mortgage (HECM) Insured and HECM Assigned mortgages.

Under this Contract, customer service is a high priority and critical to the successful performance of mortgage loan servicing functions. As such, the NSC requires not only mortgage servicing support for the HECM Insured and Assigned portfolios, but also excellent customer service for HUD's FHA Insured borrowers, FHA lenders/servicers, home ownership counseling organizations, the general public and other HUD divisions whose issues are escalated from the NSC to the Contractor.

2. STATEMENT OF OBJECTIVES

The objectives sought from this contract are:

· Professional, effective, and comprehensive loan servicing for HECM mortgage loans, notes and security instruments while maintaining a high standard of customer service.

· Maximum recoveries from the loan portfolio at the earliest possibility.

· Demonstrated effective risk management that identifies opportunities for reducing the primary or secondary portfolio.

2. STATEMENT OF OBJECTIVES

The objectives sought from this contract are:

· Professional, effective, and comprehensive loan servicing for a HECM mortgage loans, notes and security instruments while maintaining a high standard of customer service.

· Maximum recoveries from the loan portfolio at the earliest possibility.

· Demonstrated effective risk management that identifies opportunities for reducing the primary or secondary portfolio.

3. BACKGROUND

The Federal Housing Administration (FHA) is an agency within U.S. Department of Housing and Urban Development (HUD) that provides homeownership opportunities for first time homebuyers as well as borrowers who, because of limited income or impaired credit history, are under-served by conventional mortgage markets. FHA insures approved lenders against the risk of loss on loans they finance for the purchase, and in some instance’s rehabilitation, of single-family homes.

Although primarily a mortgage insurer, FHA has occasion to become the holder of primary and subordinate mortgages as a result of its loss mitigation program, in conjunction with the discounted sale of foreclosed real estate, through assignment of HECM mortgages as well as other specialized loan programs. These loans and notes are serviced for HUD by a private sector Contractor. HECM loans are serviced using the Home Equity Reverse Mortgage Information Technology (HERMIT) system. Additionally, HUD's Contractor interfaces with several HUD information management systems, described throughout this statement of work.

Currently, the NSC utilizes a centralized customer service call support operation for the Office of Single Family via the FHA Resource Center. This Customer Service support operation primarily responds and resolves contacts related to FHA-Insured Loan Servicing, Loss Mitigation, and other miscellaneous loan servicing issues.

4. LOAN TYPES — REGULATORY AND PROGRAM DIRECTIVES

The following information provides a description and reference for regulatory guidance of the specific programs.

4.1. Home Equity Conversion Mortgage (HECM)-Insured: FHA Insured HECM loans, commonly referred to as reverse mortgages, are designed to enable elderly homeowners to convert the equity in their homes to monthly streams of income and/or lines of credit. To guarantee continued payments to the borrower, should the lender fail to make the required payments, a second mortgage in HUD's name is executed and recorded subsequent to the first mortgage. Minimal servicing is required except in the event of lender failure, which has not occurred since origination of the HECM program in 1985.

4.2. Home Equity Conversion Mortgage (HECM)-Assigned: First mortgage loans in good standing, upon reaching a specified threshold, may be assigned to HUD for continued loan servicing for the life of the loan. Before acceptance of assignment of the first mortgage, HUD ensures that there is clear title from the lender to HUD. Following assignment, monthly or periodic payments are made by HUD's Contractor to the borrower. The Contractor also monitors the status of tax and hazard insurance payments and initiates foreclosure of the loan upon the death or non-compliance of the borrower.

4.2.1. The Housing and Community Development Act of 1987 (P.L. 100-242, February 5, 1988) established and subsequent legislation has amended, a Federal mortgage insurance program, Section 255 of the National Housing Act, 12 USC §1715z-20, to insure home equity conversion mortgages (HECM).

The Contractor shall furnish all necessary services, equipment, materials, licenses, supplies, facilities, personnel, and supervision to accomplish the tasks as specified in this Contract unless otherwise directed.

The following task requirements support the regulatory and program directives to ensure that the stated contract objectives are met. The tasks that follow define the contract requirements and activities to support loan servicing of the HUD mortgage portfolio. Also, included are loan servicing task requirements and activities for HUD's mortgage portfolio that need program specific instructions.

5.1. Professional, effective, and comprehensive loan servicing for a variety of mortgage loans, notes and security instruments while maintaining a high standard of customer service.

5.1.1. The Contractor shall perform comprehensive loan servicing activities per mortgage industry loan servicing standards as well as meet the specific needs of the Department and its customers. The Contractor shall utilize industry standard tools, manual preparation and/or interfaces with HUD’s business service providers in performing the requirements of this PWS. In the event that any interface is not operational, it is the Contractor’s responsibility to utilize other available resources as the requirements must still be met. Loan servicing activities include those financial and non-financial actions necessary to make sure that the portfolio of loans is managed and serviced in accordance with all applicable governing laws and in accordance with departmental policies, procedures, and regulations. The major activities include acceptance of assignment and title review, initial loan and escrow setup, accounting functions, payment collection, disbursement of payments, annual recertification, foreclosure activities, bankruptcy activities, compliance monitoring, enforcement monitoring, preparation and recording of releases and or satisfaction of mortgages.

5.1.2. The Contractor shall not utilize any tools, methods or processes that are standard industry loan servicing practices which conflict with any government requirements or laws.

5.1.3. The Contractor shall ensure compliance with HUD regulations, references, outstanding policy memoranda, sound mortgage banking practices, accounting principles, state law, and other Federal requirements as they are implemented.

5.1.4. The Contractor shall, for mortgages accepted under an assignment program or received under any other loan program, establish accounts in the appropriate computerized HUD business service provider system not later than two (2) business days after receipt, including loans that require manual establishment.

5.1.5. The Contractor shall process and disburse all payments of escrow items on all mortgages as well as for payments made to HECM mortgagors as monthly mortgage payments and/or line of credit payments. All payments shall be funded through Treasury as required.

5.1.6. The Contractor shall maintain complete and accurate physical and electronic servicing files. The electronic files must include computerized notes documenting all servicing actions relating to the loan (loan history), electronically imaged copies of all documents generated by or relating to any servicing actions, and electronically imaged copies of all correspondence sent or received relating to the loan. All correspondence received shall be date stamped upon receipt, imaged, and attached at loan level, including the envelope on HECM loans, within ten (10) business days of receipt. Exception, all requests for funds from a borrower must be imaged within five (5) business days of receipt. Disbursement requests for any property charge must be imaged prior to approval of such requests. The Contractor shall track the receipt of legal instruments, verify that these legal instruments are completed in compliance with program requirements and retain this collateral in physical files . The Contractor shall notify the sending parties and the COR of non-receipt of legal instruments not later than specified in the most current HUD guidance or as specified by the COR.

All original notes must be filed in the appropriate servicing file. All shall be made available to HUD upon request.

5.1.6.1. If the Contractor does not have the required documents necessary for a release or satisfaction of lien, the Contractor shall have thirty (30) business days to secure the missing documents or a longer time, if an extension of time has been granted. Any extension of time must be obtained in writing from the COR or alternate designee. Retrieval of said documents are to be at the expense of the Contractor and are not reimbursable. The Contractor shall make all documents available for review at the request of the COR.

5.1.6.2. All files and data shall remain the property of HUD. The Contractor holds these loan documents and permanent records in custody for HUD. Electronically imaged documents shall be produced in hard copy when requested by HUD. The Contractor shall retain original legal documents. The Contractor shall account for all files placed in its custody by HUD, HUD's Former Contractor, or a mortgage lender. If a file is lost, the Contractor shall be responsible and financially liable for reconstructing the file.

5.1.6.3. The Contractor shall box closed files as they become appropriate for archiving. With authorization from the Contracting Officer, boxes used for archiving files at the Federal Records Center may be purchased from approved suppliers at the government price. The archived boxes shall be delivered, at the cost of the Contractor, to the National Servicing Center in Tulsa, Oklahoma for processing to the Federal Records Center in Ft. Worth, TX, in accordance with HUD Handbook 2225.6 Rev-1.

5.1.7. Correspondence received by the COR may be forwarded to the Contractor for response preparation. The timeframe for response shall be determined by the COR but will not be later than five (5) business days from receipt of the correspondence. Routine correspondence will normally require a response not later than five (5) business days, but more urgent inquiries may require a faster turnaround, including one (1) business day requirements.

5.1.8. Reserved

5.1.9. Asset Sale activities - Mortgage Note Sale Processing - Future Asset Sales - The Contractor shall review the Funding Schedules/Sales Lists in preparation of an asset sale and reconcile to ensure all files are in transferrable condition upon notification of sale funding date. The Contractor shall make all documentation available for review at the request of the COR.

5.1.9.1. Technical Assistance to Mortgage Note Sale Purchasers - Past and Future Asset Sales – The Contractor shall handle case level questions; resolve missing payments; process application of payments; research taxes due and/or paid; explain case level adjustments as reflected in the loan history; prepare spreadsheets and provide copies of annual loan statements and/or history screen prints for loans sold; and maintain a log of calls for preparation of monthly reports submitted to the COR. As required, the Contractor may provide assistance with due diligence activities such as providing loan files for review in a secure, controlled environment as well as packaging loan files for shipment and shipping to the new servicer following the purchase. The shipping fees shall be at the contractor’s expense and not reimbursable. The Contractor shall make all documentation available for review at the request of the COR.

5.1.9.1.1. The Contractor shall take phone calls from mortgagors, as escalated by the NSC, concerning the sale of their loans, answer HUD-related questions or direct them to the appropriate purchaser and provide written responses addressing the delinquent status of the loans sold. The written responses, in some cases, shall require the Contractor to prepare and send a letter of explanation and payment history on the account, which shall include an explanation and payment history on the account. This shall include an explanation of the transaction field codes to assist in interpreting the payment history. The Contractor shall make all documentation available for review at the request of the COR.

5.1.9.1.2. The Contractor shall investigate mortgagor complaints to determine if the purchaser is servicing the mortgage according to the loan sale agreement, notify the COR in writing of any instances of loan sale agreement violations, and maintain a log of complaint calls received. The log of calls shall contain the mortgagor’s last name, account number and type of complaint indicating referral to COR for resolution for preparation of monthly reports to the COR. The Contractor shall make all documentation available for review at the request of the COR.

5.1.9.1.3. The Contractor shall prepare spreadsheets of the payment application as requested by the COR in special circumstances such as payment application for bankruptcies or in the event of a lawsuit. The Contractor shall make all documentation available for review at the request of the COR.

5.1.9.2. The Contractor shall forward misdirected payments to loan purchaser not later than two (2) business days after receipt.

5.1.9.3. Processing Buybacks - Past and Future Asset Sales: The Contractor shall reconcile accounting information provided by the purchaser, adjust the accounts, and record assignment to HUD, and resume servicing of the loans, or if instructed, prepare loans to be included in a subsequent asset sale.

5.1.10. Program Specific Task Requirements to support Loan Servicing HECM Insured HUD regulations governing the program are contained in 24 CFR 206. Handbooks guidelines are in 4235.1 REV-1; 4330.2 REV-1&2; 4330.1 REV-5, Chapter 13; 4335.2; and 4310.5 REV-2. Other guidance is contained in applicable Housing Notices, Mortgagee Letters, subsequent publications regarding HECM loans, as well as in the verbiage in the Note, Mortgage, and the Home Equity Conversion Loan Agreement.

5.1.10.1. Upon notification that HUD has issued Preliminary Title Approval, the Contractor shall issue a Preliminary Title Approval Letter. The Preliminary Title Approval letter must be issued within two (2) business days of notification of HUD’s approval.

Upon notification that HUD has denied the request, the Contractor shall issue a denial letter. The denial letter must be sent to the servicer within two (2) business days of HUD’s denial. If an assignment request is placed into a pending status due to the loan balance having not yet reached 98 percent of the maximum claim amount, the preliminary title approval letter or denial letter shall be issued to the servicer within fifteen (15) business days of the loan balance reaching 98 percent of the maximum claim amount. The Contractor shall make available for review all response letters and any relevant supporting documentation upon request by the COR.

5.1.10.1.1. Routine Lender Requests – Upon notification that HUD has issued a decision, the Contractor shall provide written notification to the servicing lender within five (5) business days of receipt. The Contractor shall make available for review all notifications and any relevant supporting documentation upon request by the COR. Routine requests received from lenders investors include, but are not limited to:

· Approval to call a loan due and payable and to begin foreclosure action

· Approval to allow investor short sale

· Approval to execute a subordination agreement

· Extensions

5.1.10.1.2. Partial Releases - Requests received to execute a partial release of mortgage shall be reviewed by the Contractor and a recommendation submitted to the COR for final approval/disapproval not later than five (5) business days from receipt of the complete package from the servicing lender.

5.1.10.2. HECM Assigned

HUD regulations governing the program are contained in 24 CFR 206. Handbooks guidelines are in 4235.1 REV-1; 4330.2 REV-1&2; 4330.1 REV-5, Chapter 13; 4335.2; and 4310.5 REV-2. Other guidance is contained in applicable Housing Notices, Mortgagee Letters, subsequent publications regarding HECM loans, as well as in the verbiage in the Note, Mortgage, and the Home Equity Conversion Loan Agreement.

5.1.10.2.1. The Contractor shall send Annual Certification Letters to mortgagors at least thirty (30) calendar days prior to the anniversary of the occupancy certification due date. If the mortgagor does not respond no later than thirty (30) calendar days from the date of the initial letter, the Contractor shall send a follow up Certification Letter marked "Second Request." If the mortgagor fails to respond to the second request, the Contractor shall order an occupancy inspection not later than two (2) business days after the expiration of the second request to verify the occupant of the property. The Contractor shall make all documentation available for review at the request of the COR.

5.1.10.2.1.1. If at any time mail is returned or there is other indication that the property is no longer owner occupied, such as a code violation or neighbor notification, the Contractor shall attempt to contact the borrower within two (2) business days. If unsuccessful, the Contractor shall have two (2) business days to order an occupancy inspection. HUD approval is not needed to order the inspection.

5.1.10.2.2. Within five (5) business days of receipt of a Letter of Intent to sell the mortgaged property, the Contractor shall obtain documented communication from an authorized party that the property is actively being marketed. If marketing attempts are unsuccessful after six (6) months and no extension has been granted, the Contractor shall recommend foreclosure to the COR within five (5) business days of the expiration of the six (6) month period.

5.1.10.2.3. After a repayment letter sent to the borrower estate has expired with no response from an authorized party with an intention to sell the property or complete a deed-in-lieu of foreclosure, the Contractor shall recommend for foreclosure to the COR within five (5) business days.

5.1.10.2.4. Title Review Post Foreclosure or Deed in Lieu – The Contractor shall review the title work received from the foreclosure attorney within ten (10) business days of receipt of package after foreclosure, or deed-in-lieu of foreclosure and advise COR of any title defects found.

5.1.11. Reporting - The Contractor shall develop Standard and Ad Hoc reports per the requirements set forth in this PWS. Standard reports including but not limited to, those reports described below. The Contractor shall deliver all reports to the COR accordingly but, not later than the fifth (5th) business day after the end of each month unless otherwise noted, except for Ad Hoc Reports and Accounting Reports.

5.1.11.1. Trend Report-The Contractor shall provide a monthly trend report showing trends of increasing or decreasing portfolio during the month.

5.1.11.2. Contractor Accomplishments and Issues Report-The Contractor shall report accomplishments, such as efficiency improvements for the previous month, and any issues requiring COR attention. The report shall be in a format acceptable to the COR.

5.1.11.3. Information Status Report-The Contractor shall provide a summarized status report on delinquency servicing, foreclosure status, portfolio collection, new loans established, tax payment activity, portfolio reconciliation, disbursements, mortgage release activity, custodial, and portfolio loss.

5.1.11.4. CRM Ticket Resolution Report-The Contractor shall provide via email, a report listing all CRM ticker escalations received and resolved during the prior month. The report shall be generated in an Excel file or other format acceptable to the COR. The report shall include the following information:

5.1.11.5. Performance Requirements Report - The Contractor shall provide a monthly report showing the actual date and target date that each performance requirement was met. These performance requirements are further outlined in paragraph 15 of this Contract.

5.1.11.6. Death Notices and Taxes - The Contractor shall provide a report of evidence of monthly death notices and tax records being reviewed monthly.

5.1.11.7. Special Reports - The Contractor shall develop Special Reports as requested by the COR. These Special Reports shall be created in a format accessible by HUD. All Special Reports shall be delivered within three (3) business days of request, unless otherwise agreed to by the COR or their designee.

5.1.12. Accounting Reports

5.1.12.1. The Contractor shall prepare and submit the accounting reports not later than the close of business on the 2nd business day of the month to a secured site as directed by the General Ledger Division.

5.1.12.2 The following accounting reports identified in 5.1.12.1. are as listed:

5.1.12.2.4. Check Register for Outstanding and Voided Checks (All Accounting Areas), if applicable

5.1.12.2.5. OTCnet Check Summary and Details (All Accounting Areas)

5.1.12.2.6. Daily Disbursement Report (All Accounting Areas), if applicable

5.1.12.2.7. 215 Debit Deposit Ticket (All Accounting Areas)

5.2. Maximized recoveries from the loan portfolio at the earliest possibility.

5.2.1. The Contractor shall maximize payment collections every month and shall make recommendations to HUD regarding solutions to resolve outstanding collections. The Contractor shall make all documentation available for review at the request of the COR.

5.2.2. The Contractor shall determine where bankruptcy has been filed or notices received. The Contractor shall make all documentation available for review at the request of the COR.

5.2.2.1. If a mortgagor files bankruptcy, the Contractor shall utilize any tools or processes used in standard industry practices of loan servicing that are in the best interest of the Government.

5.2.3. Where late payment of escrow items, including payment of taxes, is the fault of the Contractor, the penalty or fee assessed for late payment shall be at the expense of the Contractor. The Contractor shall make all documentation available for review at the request of the COR.

5.2.4. The Contractor shall not charge fees or assess late charges on Secretary-Held HECM mortgages.

5.2.4.1. For providing statements of account to mortgagors.

5.2.4.2. Reserved.

5.2.4.3. For processing payment plan change on a HECM loan.

5.2.5. The Contractor shall process any non-sufficient fund (NSF) check twice before assessing a $10.00 NSF charge to the homeowner's account. The Contractor shall make all documentation available for review at the request of the COR.

5.2.5.1. The Contractor shall issue an NSF letter not later than two (2) business days of the assessment, advising the homeowner of charges added to the account.

5.2.6. Upon notification that a property may be vacant, the Contractor shall order an on-site inspection within two (2) business days. If the Contractor determines a property is vacant (no longer occupied), the Contractor shall notify the COR via HERMIT not later than two (2) business days of determination. COR confirms vacancy and places property into custodial care. The Contractor shall verify HUD's systems to ensure the property is coded as a non-HUD owned custodial.

5.2.7. The Contractor shall monitor the non-judicial foreclosures (NJF) assigned to NJF Commissioners to ensure the foreclosure sale is completed no later than one hundred twenty (120) calendar days from referral to the Commissioner The Contractor shall request the current status of the foreclosure from the Commissioner monthly and shall note HUD’s system of record accordingly. If the Contractor determines that the Commissioner is not proceeding with timely foreclosure actions, the COR is to be notified for further direction. Deed in Lieu requests shall be completed no later than ninety (90) calendar days from receipt of the Letter of Intent to execute a Deed In Lieu of Foreclosure.

5.2.8. The Contractor shall notify the COR or designee of the acceptance of a third-party bid not later than two (2) business days after a foreclosure sale. The Contractor shall notify the COR or designee of the receipt of payoff funds from a third-party foreclosure sale not later than two (2) business days after payoff funds are received. The Contractor shall make all documentation available for review at the request of the COR.

5.2.8.1. The Contractor shall notify the COR or designee of the receipt of payoff funds not later than two (2) business days after payoff funds are received where the property is in custodial care.

5.2.9. The Contractor shall convey foreclosed, vacant properties to REO not later than five (5) business days from receipt of deed (if HECM, deed copy must have the recorded information to convey). Occupied properties requiring eviction shall be conveyed not later than ninety (90) calendar days from sale date unless an extension request is submitted and approved by the COR or designee. Eviction proceedings are reimbursable and shall be charged to the loan. The Contractor shall make all documentation available for review at the request of the COR.

5.2.10. The Contractor shall process payoff requests not later than two (2) business days from receipt of a request. The Contractor shall submit complete compromise packages to the COR or designee not later than five (5) business days from determining eligibility or notification from the COR or designee.

5.2.11. The Contractor shall process all payments through Treasury not later than the next business day after receipt.

5.2.12. The Contractor shall accept cash payments. The Contractor shall give the remitter a receipt and convert the cash to a bank draft or money order and identify the draft or money order with the FHA case number and the loan program to which it relates.

5.2.13. The Contractor shall ensure complete documentation of all disbursements and other accounting related functions is maintained. All information relative to disbursements and accounting shall be readily accessible and filed in the loan level servicing file. All accounting files shall be the property of HUD and available to HUD upon demand during the Contractor's regular business hours. The files shall be forwarded to the COR not later than five (5) business days from request.

5.2.14. The Contractor shall perform payee and code file maintenance as instructed by the COR, using adequate internal controls and separation of duties. At a minimum, disbursement-processing duties shall be segregated from global processing duties.

5.2.17. The Contractor shall prepare, execute, and record releases and/or satisfactions including any ancillary documents required to effectuate the releases, or facilitate the recordation, not later than fifteen (15) business days from receipt of a request that a release is required. The Contractor shall utilize industry standard tools, manual preparation and/or interfaces to prepare and execute releases and or satisfactions. The actual cost of recording fees paid to the county will be reimbursable. Recording fees on HECM Assigned loans shall be charged to the loan. In the event that any interface is not operational, it is the Contractor’s responsibility to utilize other available sources as the requirement must still be met. If an extension of time is needed to retrieve ancillary documents to exceed this timeframe, a request with justification must be submitted to the COR. The costs of the retrieval of any ancillary documents are not reimbursable. Upon receipt of the Original recorded release, the contractor shall image the recorded release or satisfaction and mail the original to the mortgagor. The Contractor shall make all documentation available for review at the request of the COR.

5.2.17.1. The Contractor shall document release activity, including the receipt of rejected releases, at a loan level in the appropriate servicing system within five (5) business days of receipt. All rejected releases must have necessary corrections made and sent for recording within two (2) business days of receipt, unless correction is related to a document that is unavailable in HERMIT.

5.3. Demonstrated effective risk management that identifies opportunities for reducing the primary or secondary portfolio.

5.3.1. Reserved.

5.3.2. The Contractor shall perform a monthly reconciliation of the portfolio to identify anomalies, recommend innovative options to resolve the anomalies to the COR, and upon COR approval, process the recommendation. (Also, see paragraph 5.1.11).

6. AWARD

The Contractor shall obtain all required licenses, permits, bonds and legal permissions required to transact business within the contract area.

6.1. Post Award Conference: Not later than seven (7) business days following the award date of the contract, the COR or CO will notify the Contractor of the date and location of the post award conference. The Contractor and key staff shall attend the post award conference.

6.2. Reserved.

6.2.1.

6.2.1.1. Systems Security: HUD's system clearance procedures require that the SSA shall use forms provided by HUD to initiate requests for user access to HERMIT, SMART, and other HUD systems. The SSA shall certify, not later than twenty (20) business days from the effective date of the contract 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, and have completed the HUD's Computer Based Training program or Rules of Behaviors.

6.2.1.1.1. Reserved.

6.2.1.2. Reserved.

6.2. Complete Infrastructure: The Contractor shall notify the COR that the tax scrub described in the Contractors proposal has been completed and provide final results of same.

6.3. Staffing: The Contractor shall employ a sufficient number of experienced staff dedicated to this contract with technical capabilities to complete all deliverables in a timely, accurate, and concise manner as set forth in the scope of work. The Contractor’s staff shall demonstrate knowledge of servicing and loss mitigation and interpreting as well as implementing HUD regulations governing home mortgage programs. They must also have a wide range of knowledge in lending institutions, mortgage servicing activities, workout solutions and foreclosure relief alternatives.

6.3.1 Key Personnel: The personnel specified below are considered to be essential to the work being performed under this contract and are considered key personnel. Prior to diverting any of the specified individuals to other projects, the contractor shall notify the Contracting Officer reasonably in advance and shall submit a resume (including proposed substitutions) in sufficient detail to permit evaluation of the impact on the program. No diversion shall be made by the contractor without the written consent of the Contracting Officer. Key personnel shall meet the following minimum qualifications:

· Contract Manager – Qualifications based on past work history commensurate with the service, complexity, magnitude, and responsibilities of a contract manager to ensure compliance with the contract.

· Alternate Contract Manager – Qualifications based on past work history commensurate with the service, complexity, magnitude, and responsibilities of a contract manager to ensure compliance with the contract.

· Cash Manager – Qualifications based on past work history. Certified Public Account (CPA) License and experience with U.S. Treasury Cash Management Regulations is required. Note: This is a mandatory licensing requirement and shall not be waived.

6.4. Reserved.

7. CONTRACTOR FURNISHED ITEMS WITH GENERAL REQUIREMENTS

7.1. Hours of Operation: The hours of operation shall be from 7:00 am to 7:00 pm, local time in the geographic area, Monday through Friday, with the exception of recognized Federal holidays or days when the Department has closed due to unforeseen circumstances such as inclement weather subject to the COR approval. The Contractor is responsible for ensuring that there is adequate Servicing staff, including the Contract Manager, alternate, or designee, to perform all tasks as specified in this PWS during these hours of operation.

7.2. Personnel: Contract Manager, Alternate Contract Manager, and Cash Manager- the Contract Manager shall have full authority to act for the Contractor on all matters relating to daily operations, and for the performance of the contract. The designated Alternate Contract Manager shall act in the absence of the Contract Manager, with the same authority and responsibilities as the Contract Manager. The Contract Manager or Alternate Contract Manager or designee shall be on-site during normal duty hours. The names of the Contract Manager, Alternate Contract Manager and Cash shall be included in the personnel named in HUDAR 2452.237-70 Key Personnel Clause. Any changes in Key Personnel must be approved by the Contracting Officer and COR prior to assuming the position.

7.2.1. Qualifications of Key Personnel: The following minimum qualifications are desired unless stated otherwise:

7.3. Customer Service- In as much as the Contractor's performance reflects directly on the Department, customer service is a high priority under this contract. The Contactor shall work to perform the highest level of customer service to HUD's clients. The Contractor shall ensure that all contacts with the public and HUD employees promote HUD's objectives under this PWS, encourage participation by industry professionals and mortgagors that will result in a high level of customer satisfaction. Customers, for the purpose of this PWS include mortgagors, nonprofit organizations, government entities, real estate brokers and agents, title companies, attorneys, Mortgagees and HUD employees. Customer service includes, but is not limited to, answering questions; resolving complaints; providing loan information and status; referring customers to appropriate service agencies; assisting all customers in a prompt, professional and courteous manner and ensuring that mortgagors are satisfied with their experience.

7.4. Telecommunications Hook-Ups, Etc. -The Contractor shall maintain the HUD-owned toll- free telephone number available for use by HUD employees and customers. The Contractor shall provide telecommunications hook-ups, including equipment to communicate with hearing-impaired clients, and a sufficient number of toll-free lines to meet the performance requirements. The telephone system for the toll-free lines shall include an option for Spanish language communication and TDD for the hearing impaired. The Contractor shall have the capability of growth to support ongoing HUD programs and initiatives that may need separate toll-free numbers. The equipment shall have the ability to transfer calls through an Interactive Voice Response (IVR) prompt which will require connectivity from the Contractor's office to the NSC and the FHA Resource Center.

The Contractor shall ensure that the telecommunication system maintain an operational capability 100% of the time, except during periods of approved documented scheduled maintenance or circumstances outside of the Contractor's control (Scheduled maintenance shall be approved by the COR no later than 48 hours prior to downtime). The Contractor's telecommunications equipment shall be operational and maintain continuous telecommunication operation (defined as that equipment necessary to receive and route calls to the NSC or FHA Resource Center, offer customers the opportunity to listen to prerecorded messages and to accept voice mail).

7.4.1. Response Time -The Contractor shall provide prompt, courteous and accurate response to all telephonic inquiries regarding requests for loan information in general. The Contractor shall respond to inquiries not later than 12 noon or one (1) business day of the date the inquiry was received by the Contractor's office or the expiration of such shorter or longer period as expressly authorized or required by this PWS. The Contractor shall respond to written and electronic inquiries no later than four (4) 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. This applies to all areas of service in the contract and is not just related to Customer Service.

7.4.2. Governmental Inquiries -The Contractor shall notify the COR not later than twenty-four (24) hours following receipt of any request for information from an elected or public official and shall, not later than two (2) business days of said request, provide written information to assist HUD in preparing a response.

7.4.3. Freedom of Information Act -The Contractor shall be familiar with the Freedom of Information Act (FOIA) (Title 5 V.S.C. Section 552) and the Privacy Act (5 V.S.C. § 552a) and shall assist HUD in responding to requests for information. The Contractor shall forward all requests for information that are subject to FOIA or the Privacy Act to the FOIA Officer as determined by the COR. In the case of a FOIA request that involves costs to the requestor, the Contractor shall provide a cost breakdown to the COR.

7.4.4. Litigation -The Contractor shall not represent that it is authorized to accept service of process on behalf of HUD. However, if the Contractor receives any pleading naming HUD as a party, the Contractor shall provide the COR and the Office of General Counsel in the jurisdiction specified and any other designated HUD representative with a copy of such pleading not later than one (1) business day after receipt of the pleading. COR will provide contact information.

7.5. Document Pick-Up and Delivery: The Contractor shall pick up and deliver documents daily, as needed, except for holidays, to and from the Tulsa, Oklahoma HUD office. In the event the Contractor is unable to pick up documents, documents will be sent daily to and from the Tulsa, Oklahoma HUD office via the same courier or overnight delivery at the Contractor's expense.

7.6. Equipment and Supplies: All tools, supplies, and items of equipment necessary to the performance of the contract and the deliverables herein are the responsibility of the Contractor. The Contractor shall ensure that all systems shall be compatible with HUD's operating environment. HUD's environment operates by Windows 7 currently and Internet Explorer 11 (IE 11) and any subsequent changes. The Contractor shall ensure the hardware and software being used is compatible with HUD's computer systems.

7.7. Check Printing Equipment: The Contractor shall provide check-printing equipment and an associated router. This equipment must be approved by the COR.

7.8. Electronic Communication with HUD: The Contractor shall procure access through a commercial on-line application to electronically communicate with HUD users and to access HUD's Internet web site and Wide Area Network (WAN). The Department currently uses MS Outlook for internal and external e-mail.

8. BUSINESS PROCESSES

8.1. Internal Controls and Compliance — The contractor shall establish, document, and maintain internal controls appropriate to the services performed under the contract, including separation of duties, audit logs, quality assurance procedures for data integrity, protection of personally identifiable information, authentication of personal identity in transactions with the public, system security, and continuity of operations. The contractor shall answer inquiries, provide documentation, and give access to facilities in support of HUD's audits and internal control and compliance reviews, including the annual audit of FHA's financial statements, annual reviews of internal controls under OMB Circular A-123 and annual reviews of financial system compliance under OMB Circular A-127.

8.1.1. Federal standards and requirements applicable to the contractor are identified in Table 1.0. The contractor is responsible for maintaining compliance with these standards as they are updated by Congress and the issuing Federal agencies. Corresponding and related standards and requirements for HUD are identified in Table 2.0.

8.1.2. Personally, Identifiable Information — The Contractor shall establish, document, and maintain technical and procedural protections against the release of personally identifiable information.

8.1.3. Authentication of Personal Identity — The Contractor shall establish, document, and maintain technical and procedural methods to authenticate personal identify in all transactions with the public in accordance with Federal e-Authentication regulations. The contractor shall complete an e-Authentication Risk Assessment report annually.

8.2. Data Transfer – The Contractor shall transfer the data according to HUD's approved IT policies and procedures on data transfer protocol. Any such data transfer shall be coordinated with HUD to ensure adequate safeguards are taken to protect HUD's system integrity. Transfer may take place as frequently as needed. The Contractor shall be responsible to work with designated HUD vendors to place a copy of its data or images at the HUD vendor's site.

8.2.1. The Contractor shall have on staff the necessary technical personnel and resources to transfer data to and from each business service provider according to HUD's approved IT policies and procedures. The contractor shall coordinate with the COR to ensure adequate safeguards are followed.

9. PHYSICAL SECURITY AND SAFEGUARDS

The Contractor shall establish and maintain a physical loan file that contains all original promissory notes, that pertain to each loan in the portfolio, as directed by the COR. The Contractor shall adhere to all current HUD regulations and directives on file retention and storage requirements as described in Handbook 2225.6 Rev. 1 Chg. 44 or subsequent policy directive.