MD Closing Agent.docx

February 10, 2012

THIS IS A 100% TOTAL SMALL BUSINESS SET-ASIDE

Dear Prospective Offeror:

The enclosed Request for Proposal (RFP) R-PHI-00024 is for the purpose of acquiring Closing Agent Services for the State of Maryland under the jurisdiction of the Philadelphia Homeownership Center.

The solicitation consists of four parts, Parts I, II and III will constitute the contract document(s) anticipated as being awarded as a result of this solicitation. Part IV contains instructions and forms for submission of proposals: Section K provides provisions to be completed and submitted with your proposal; Section L provides instructions concerning submission of proposals; and Section M describes the basis for proposal evaluation and contract award.

If you would like to compete for this contract, please submit an ELECTRONIC proposal in accordance with Section L of the RFP. Submit your proposal to the email address specified in Block 8 of the enclosed SF-33 by the deadline set forth in Block 9 of the SF-33. HUD will not accept proposals by any means other than electronic submission via email; no faxes or mailed hard copies will be accepted.

Please do not submit any unnecessarily elaborate proposals. If you have any questions, please contact Bridgette Anderson at (215) 430-6722 no later than February 23, 2012.

Sincerely,

Error! Main Document Only.

U.S. Department of Housing and Urban Development Office of the Chief Procurement Officer The Wanamaker Building

Visit our web page at http://www.hud.gov/offices/cpo/contract.cfm

SOLICITATION, OFFER AND AWARD

OF

U.S. Department of HUD The Wanamaker Building Contracting Operations Branch 100 Penn Square East, 10th floor Philadelphia, PA 19107 Bridgette Anderson at Bridgette.m.anderson@hud.gov

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

SOLICITATION

(Hour)

(Date)

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

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

11. TABLE OF CONTENTS

OTHER STATEMENTS OF OFFERORS

OFFER (Must be fully completed by offeror)

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

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

20 CALENDAR DAYS

30 CALENDAR DAYS

CALENDAR DAYS

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

15A. NAME

CODE

FACILITY

16. NAME AND TITLE OF PERSON AUTHORIZED TO SIGN

OFFER (Type or print)

15B. TELEPHONE NO. (Include area code)

ADDRESS IS DIFFERENT FROM ABOVE - ENTER SUCH ADDRESS IN SCHEDULE

AWARD (To be completed by Government)

19. ACCEPTED AS TO ITEMS NUMBERED

20. AMOUNT

21. ACCOUNTING AND APPROPRIATION

10 U.S.C.2304 ( c ) ( )

(Signature of Contracting Officer)

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

NSN 7540-01-152-8064

PREVIOUS EDITION NOT USABLE

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

PART I – THE SCHEDULE

SECTION B – SUPPLIES OR SERVICES AND PRICE/COSTS

B-1. SERVICES

This contract shall provide real estate property sales closing services for single-family (one to four units) properties owned by the U.S. Department of Housing and Urban Development (HUD) located in the state of Maryland.

HUD reserves the right to selectively assign properties to be closed, or to administratively revise the geographic boundaries of the area in accordance with the changes clause of the contract, if such action is determined to be in the best interest of HUD.

B-2. TYPE OF CONTRACT

This is a Fixed Unit Rate Indefinite Delivery Indefinite Quantity (IDIQ) contract; there will be no cost reimbursements.

B-3. HUDAR 2452.216-76 MINIMUM & MAXIMUM QUANTITIES AND AMOUNTS FOR ORDER (FEB 2006)

The minimum quantity and/or amount to be ordered under this contract shall not be less than 10% of the estimated CLIN 0001 value. Actual dollar value will be determined at time of contract award.

The maximum quantity and/or amount to be ordered under this contract shall not be more than 150% of the estimated CLIN 0001 value. Actual dollar value will be determined at time of contract award.

B-4. PRICING SCHEDULE

As total compensation for all services performed in accordance with the terms and conditions of this contract, the Contractor shall be paid according to the fixed unit price listed below for closings conducted by the Contractor:

(a) Property Closing Services (Tasks 1, 2, 3, 5 and 6). The unit price for Property Closing Services specified herein shall be a flat fee. Unless otherwise specified herein, this flat fee shall include the cost of all services and the preparation of documents required by any party to the closing, including any loan documents required by any lender. The flat fee shall include, without limitation, the cost of phones, postage, shipping, delivery, courier service, express mail, faxing, scanning, document reproduction, postage prepaid envelopes, transportation, wire transfer fees incurred by the Contractor, title search costs, any and all licenses, insurance, certificates or permits as stated in Section C.3 (a) (2), attorney fees, costs related to deed preparation and all office requirements as referenced in this contract.

(b) Next Door Programs (Task 4). For closings assigned under one of the Next Door programs, the Contractor shall be paid a fee in addition to the flat fee for Property Closing Services. This additional fee shall be reflected as a separate line item on the HUD–1 as a charge to the Seller with the notation “*ND 2nd Mortgage Fee and Note Fee” for Next Door program closings (* using the acronym “OND” for the Officer Next Door program, “TND” for the Teacher Next Door program, “FFND” for the Firefighter Next Door program or “EMTND” for the Emergency Medical Technician Next Door program).

(c) Special Services (Task 7). The Contractor shall be paid a flat fee for Special Title Search Services and Special Recordation Services that may be ordered by the GTR. The unit prices for the CLINS entitled Special Recordation Services and Special Title Search Services specified herein shall be inclusive of all costs specific to those services. These Special Services are in no way associated with title search services and recordation services required as part of the Property Closing Services. The Contractor shall not receive compensation under the CLINS titled Special Title Search Services and Special Recordation Services for title search services and recordation services performed as part of the Property Closing Services.

(d) Third Party Closings. For third party closings at which the Contractor physically represents HUD, the Contractor shall be paid 100% of the fixed unit price per closing. Such closings shall be conducted during normal business hours at the location of the third party closer chosen by the purchaser.

(e) Cancelled Closings and Expired Contracts: Should a sale not close despite good faith efforts by the Contractor, the Contractor shall be paid 25% of the fixed unit price per closing. Closings that are delayed are not considered cancelled closings. This is the only fee that will be paid to the contractor in connection with a closing that is cancelled.

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

The purchase of a title policy is strictly at the purchaser’s discretion and is not required to close a HUD property. The Contractor shall not influence the purchaser to purchase a title policy from any particular company. The choice of the title company issuing the title policy shall be left to the purchaser.

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

Base Period

Requirement

Option Year 1

Requirement

Option Year 2

Requirement

Option Year 3

Requirement

Option Year 4

Requirement

ESTIMATED TOTAL VALUE OF

ALL CONTRACT PERFORMANCE PERIODS

· Estimated quantities are based on data from previous years; they are provided for evaluation purposes only and shall not obligate HUD to any quantities other than the minimum stated under Section B-3.

· You must have the capability to complete the entire estimated quantity within each 1 year contract period. Failure to have this capability may render you non-responsible.

(End of Section B)

SECTION C - DESCRIPTION/SPECIFICATIONS/STATEMENT OF WORK

STATEMENT OF WORK (SOW)

FOR

CLOSING AGENT SERVICES

C.1 BACKGROUND

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

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

C.2 SCOPE OF REQUIREMENTS

(a) Purpose. This is a fixed unit rate contract with a single unit price per completed closing. The Contractor shall proactively work with HUD’s AM, any successor contractors, the GTR and the GTM to ensure that closings are performed in a timely manner. The Contractor shall perform to meet or exceed the performance standards specified in this contract.

(b) Objectives. The primary objectives of this contract are to:

(1) Proactively represent HUD’s interests at the sales closing;

(2) Close on the sales contract as soon as possible after the contract is signed;

(3) Ensure that HUD funds received are accurately and timely provided to U.S. Treasury (Treasury); and

(4) Accomplish the closings with error-free closing documents.

(c) Results and Outputs. The Contractor’s performance under this contract shall ensure that:

(1) Closings are fully completed and reconciled in the shortest time frame possible but no later than the date specified in the sales contract (unless an extension of time to close has been approved);

(2) HUD funds are transferred to the Treasury; with few or no assessments of liquidated damages for untimely processing;

(3) The Contractor’s internal quality management includes identifying and correcting errors in processing requirements.

C.3 TASKS AND DELIVERABLES

(a) Task 1: General Requirements. The primary objective is to perform closings of HUD-owned properties as quickly as possible. Typically, a purchaser is provided up to 45 calendar days to close the transaction. However, from time to time, HUD may offer special incentive programs to homebuyers to close in a shorter period of time, such as 30 days after contract execution. The Contractor shall coordinate with the AM to affect the closing within the time frame specified in the sales contract unless an extension is necessary due to circumstances outside of the Contractor’s control.

(1) Office and Contract Manager.

(i) The Contractor shall establish and maintain a fully staffed, equipped, and supplied main office within the identified geographic area so as to provide convenient service to HUD and its clients as further outlined in Task 3. The Contractor shall have a toll free number through which HUD’s clients can contact the main office without incurring long distance charges. The Contractor shall take proper health and safety precautions to protect workers, the public and the property of others. The Contractor shall maintain the office(s) to manage assigned closings and provide service from 8:00 AM to 5:00 PM, local time in the geographic area, Monday through Friday, with the exception of recognized federal holidays and other industry-accepted days to be closed (e.g. Friday after Thanksgiving).

Note: Although only one office is strictly required under this contract, the Contractor is responsible for performing tasks throughout the state in a timely manner. The Contractor may establish other offices that it believes are necessary to facilitate the provision of services in a timely manner throughout the geographic area.

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

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

(3) Escrow Account.

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

(ii) As soon as possible following termination or expiration of this contract, but no later than 90 days following such termination or expiration, the Contractor shall close the escrow account and provide the GTR with a cashier’s check for the balance in the account. Within 30 days following closing of the account, but no later than 120 days following the termination or expiration of the contract, the Contractor shall provide the GTR with an appropriate reconciliation of all funds covered by said cashier’s check, including a copy of the final bank statement showing a zero balance in the account.

(iii) The Contractor shall provide monthly bank statements to the GTR no later than ten (10) business days following the statement ending date and a letter affirming that the statement has been reconciled. The letter shall also include the number and amount of each check that has been outstanding for more than sixty (60) calendar days and the efforts put forth by the Contractor to clear these checks.

(4) Quality Control (QC) Plan. The Contractor shall establish and maintain a complete QC plan to ensure the requirements of the contract are performed as specified. Two copies of the Contractor’s final QC plan shall be provided to the Contracting Officer not later than the post-award conference. The Contractor shall provide two complete copies to the Contracting Officer as any updates/changes occur. The plan shall include:

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

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

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

(iv) Adequate internal control measures to ensure that:

(A) Case files and file documents are managed and controlled to prevent any loss of documents or disclosure of purchasers’ personal information to unauthorized third parties; and

(B) Funds received and paid out are properly and timely managed and cases are timely reconciled.

(5) Customer Service. Because the Contractor’s performance reflects directly on the Department, customer service is a priority under this contract. The Contractor shall work to perform the highest level of customer service to HUD’s homebuyers and real estate brokers.

(6) Records Maintenance and Safeguarding of Personally Identifiable Information (“PII”).

(i) Throughout the entire life of the contract the Contractor shall maintain a system of record keeping which will ensure that physical and electronic documents are:

(A) Properly and promptly filed upon receipt;

(B) Not lost or misplaced;

(C) Easily and promptly retrieved upon request by the GTR or GTM, Contracting Officer, or any other authorized person; and

(D) Maintained securely and with complete confidentiality.

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

(iii) PII includes, but is not limited to any information about an individual, including financial transactions, employment history and information which can be used to distinguish or trace an individual’s identity, such as their name, social security number, date and place of birth, mother’s maiden name, etc., or any other personal information that is linked or is linkable to an individual.

(iv) The Contractor is responsible for implementing adequate safeguards to ensure that such PII is not made available, whether intentionally or unintentionally, to parties not involved in the sale of property to the purchaser.

(vii) Any documents containing PII that are not subject to the records retention requirements set for in subsection iii herein below shall also be shredded. With respect to electronic records that contain PII, the Contractor shall, at its own expense, destroy such records in a manner that ensures that PII is properly safeguarded.

(viii) The Contractor must at all times comply with applicable requirements of HUD Information Technology Security Policy, Handbook 2400.25 Rev. 1.

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

(x) Minimum records to be maintained include:

(E) Bank Statements and proof of deposits for the required escrow account;

(F) Proof of wire transfers of proceeds;

(G) Canceled checks for disbursements (including the property address and notation of types of expenses);

(H) A log of all payments received, recorded separately showing the FHA case number, date, amount, purpose, and if payment was made at closing or outside of closing; and

(I) Copies of each document related to the closing performed.

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

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

(1) Open Closing File: The Contractor shall establish a closing file upon receipt of the contract package from the AM. The contract package shall include:

(i) A signed sales contract (HUD 9548) with any addenda and amendments;

(ii) Title Evidence (when available);

(iii) Documentation regarding status of rents due to HUD (when purchaser is HUD’s tenant); and

(iv) Bulk Sales listing (if applicable).

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

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

(4) Written Notification. The Contractor shall provide written notifications as required.

(i) Not less than fifteen calendar days prior to the latest possible closing date, the Contractor shall provide the broker a written warning if a firm closing date has not been established that the contract may expire.

(ii) The next business day after the closing date stated on the contract, if no closing has occurred, the Contractor shall notify the broker in writing that the sale did not close and that the AM has been notified that the sale has been canceled. The deed shall be voided and returned to the AM if closing does not take place within 7 calendar days of the Special Warranty Deed.

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

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

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

(ii) Deed: When preparing the required deed for a sale under a Special Discount program, Contractor shall ensure that the appropriate “deed restriction” clause is included, in accordance with the instructions provided as an attachment at Section J.1 and referenced HUD guidance. Please note that no deed restriction is required for $1 Home Sales closings.

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

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

(i) Not more than one business day after receipt of the request, the Contractor shall fax the request and all supporting documentation (including a copy of the check) to the AM.

(ii) If the request is approved by the AM, the Contractor shall deposit the extension funds into the escrow account and notify the broker no more than one business day after approval.

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

(iv) If the request is denied by the AM, the Contractor shall refund the extension fee to the broker no later than one business day after denial with instructions to close by the scheduled closing date.

(v) If an extended sale fails to close, the Contractor shall, no more than one business day after the failed closing, telephonically or electronically notify the AM, and forward the extension fee and a copy of the extension approval to the AM with the notation “FAILED TO CLOSE.”

(vi) For each case where a closing is delayed due to title-related issues, and a closing cannot take place within the required time frames due to such delays, the Contractor shall prepare an Extension Request form, documenting the reason(s) for the delay and the length of the delay, and forward the request to the AM as outlined above for approval. Under such circumstances, it would not be the responsibility of the purchaser to request an extension.

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

(10) Preparation of the HUD-1.

(i) Accurate preparation of the HUD-1 is critical to timely processing. The Contractor shall use an automated closing process software package as identified in the technical proposal to complete the HUD-1 and to minimize errors. The Contractor shall prepare the HUD-1 so as to facilitate a full and complete closing, including all required disbursements, collections, and deposits. For all closings, the Contractor shall scan and upload a copy of the prepared HUD-1 into P260 for the Asset Manager’s review/approval, twenty-four (24) hours prior to the scheduled closing date.

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

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

(11) Third Party Closings: The Contractor or a subcontractor shall physically represent HUD at all closings that are conducted by a third party. Although the Contractor is permitted to work out a mutually agreed upon closing location, the purchaser ultimately decides and controls the location of the third party closing. The Contractor shall receive the full fixed unit price per closing as set forth in Section B.4 for all third party closings. For such closings, the Contractor’s responsibilities are as follows:

(i) Forward letter to third party closer outlining HUD’s requirements and time frames. Contractor shall clearly inform the third party closing agent that HUD requires the submission of the HUD-1 for review and approval by the AM at least 24 hours before closing.

(ii) Perform title search on HUD’s behalf (as outlined under C.3(b)(2)).

(iii) Prepare deed and forward for signature (as outlined under C.3(b)(5)).

(iv) Ensure that the HUD-1 is accurate.

(v) Inform the third party closer that HUD requires certified funds or receipt of a wire transfer of the sales proceeds on the day of closing. Upon receipt of sales proceeds from the third party, deposit funds into HUD’s escrow account and wire transfer the funds to HUD’s Treasury account on the day of closing or the next banking day. Submit original wire receipt to the AM with the closing package.

(vi) Ensure that the deed is recorded. Obtain recording information/receipt from the third party for submission with the closing package OR submit within 24 hours of receipt from the third party.

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

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

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

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

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

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

(4) Sales Proceeds: Accept a certified or cashiers check made payable to the Contractor. Electronic transfer of funds is also acceptable.

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

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

(i) The Contractor shall pay only those costs listed as closing costs automatically paid by HUD as reflected in current notice (Notice 2011-33) or subsequent official guidance that may be issued. The Contractor shall pay the expenditures listed therein, as herein qualified, at the time of closing from HUD’s sales proceeds. In the event that sales proceeds are insufficient to pay all allowable expenses, the Contractor shall advance payment for any excess expenses and request reimbursement from HUD through the submission of an invoice (see Section G.1).

Also in accordance with the current notice (Notice 2011-33) or subsequent official guidance regarding allowable closing costs, for cases where the executed HUD-9548, Sales Contract, reflects approved closing costs on Line 5, the Contractor shall charge allowable closing costs to HUD, not to exceed the amount reflected in the Sales Contract. Note: Wire transfer fees for sales proceeds wired to the Contractor is the buyer’s expense and is not paid by HUD. Wire transfer fees for sales proceeds wired by the contractor to HUD’s Treasury account are at the contractor’s expense.

(ii) If there are reasonable and customary closing costs that are paid by the seller in the local real estate market(s) covered by this contract that are not included in current notice (Notice 2011-33) or subsequent official HUD guidelines, the Contractor may submit a request to the GTR for approval of such additional costs as allowable closing costs. The Contractor shall identify all such additional closing costs and submit them with complete explanation/justification to the GTR for “blanket” approval of these items as allowable closing costs.

(7) Surveys: Contractor shall provide the Homeowner Satisfaction Survey and a postage pre-paid envelope to the purchaser and shall provide the Real Estate Broker Satisfaction Survey and postage pre-paid envelope to the broker.

(d) Task 4. Next Door Programs. Next Door programs include sales under the Officer Next Door, Teacher Next Door, Firefighter Next Door and Emergency Medical Technician Next Door programs.

(1) Assignment: Upon assignment of a sale under a Next Door program, the Contractor will receive from the AM contractor, in addition to basic closing documents, a completed HUD-9548-A, “Certification of Law Enforcement Officer/Teacher/Firefighter/Emergency Medical Technician,” HUD-9548-B, “Land Use Restriction Addendum” and, where applicable, HUD-9548-C, “Assignment of Sales Contract.” The Contractor shall ensure that a sale pursuant to a Next Door program does not take place unless properly completed and executed original forms are present and shall ensure that the original copies are made a part of the closing file.

(2) Deed: When preparing the required deed, the Contractor shall ensure that the appropriate “deed restriction” clause is included, in accordance with the instructions provided as an attachment in Section J.2 and referenced HUD guidance.

(3) Second Mortgage and Subordinate Note. The Contractor shall ensure that a properly completed and executed second mortgage and subordinate note in an amount equal to exactly fifty percent (50%) of the list price are signed by the purchaser(s) under a Next Door program and are made a part of the closing file. The Contractor shall prepare the necessary second mortgage and subordinate note using the sample formats provided in HUD Notice H 99-30 at Exhibit E or subsequent guidelines with the modifications outlined in the attachment provided in Section J.2. The contractor will receive from the AM the date of first occupancy to be used in the Second Mortgage and Second Lien Mortgage Note. Requests for extension of occupancy dates must be submitted in writing to the AM and must be supported by appropriate documentation. The AM will then submit the extension request to the GTR for review and action, as appropriate.

(4) At closing. Contractor shall:

(i) Review the signed HUD Form 9548-A and HUD Form 9548-B with the purchaser(s). Emphasize to the purchaser(s) under the Next Door program that they have signed a document requiring them to own no other residential real estate for three years and to occupy the dwelling as their sole residence for that required term. Read aloud to the purchaser(s) the Warning contained on the form, which outlines possible criminal penalties for failure to comply with these requirements or for falsification of the form.

(ii) Inform purchaser(s) that any delay in occupancy as agreed and specified in the second mortgage documents will be considered a breach of contract terms. Contractor shall provide purchaser(s) with the required Fact Sheet (Exhibit I for the Officer Next Door program and Exhibit J for the Teacher Next Door program of HUD Notice H 99-30) and shall insert into the Fact Sheet, the statement that any delay in occupancy as agreed and specified in the second mortgage documents will be considered a breach of contract terms. In addition, Contractor shall obtain written acknowledgement of receipt by the purchaser(s) of the required Fact Sheet by inserting an acknowledgement of receipt signature line, including the date, at the bottom of page 2 of the Fact Sheet for this purpose. The original acknowledgement is to be submitted to the AM as part of the closing package.

(5) Recording Fees. The Contractor shall ensure that the recording fees for the second mortgage and the subordinate note are charged to the buyer on the HUD-1.

(6) Recordation. The Contractor shall file the second mortgage and the subordinate note for record no later than one business day after the closing and provide the AM with a copy of the second mortgage and subordinate note and the original recordation receipt as part of the closing package.

(7) Original Documents: Upon receipt of the recorded second mortgage and the subordinate note, the Contractor shall forward the original documents to the AM no later than one business day after the closing.

The Contractor shall report all suspected cases of fraud/abuse to its assigned GTR at the appropriate HOC.

(e) Task 5. Post-closing Activities. The Contractor shall perform all necessary post-closing activities, including those below, to ensure that HUD is able to accurately and timely reconcile the closing.

(1) Verification of Closing. The same day that the closing takes place, electronically notify the AM of the closing.

(2) Wire of Proceeds. Not later than one banking day after the closing takes place, the Contractor shall wire the net sales proceeds to the U.S. Treasury via FEDWIRE using the form SAMS-1103, Request to Transfer Funds. Delays in the remittance of net sales proceeds shall be subject to liquidated damages as outlined in Section F-3. As stated in C.3 (e) (4) (vi), the contractor’s certification shall contain any potential mitigating factors for the GTR’s consideration.

(3) Delivery of the Deed for recordation. Not later than one business day after the closing has taken place, the Contractor shall deliver the deed for legal recordation in the correct county and provide written notification to the AM and the Homeowners or Condo Association (if applicable).

(4) Scanning and Delivery of the Closing Package. The Closing Agent shall scan and upload the documents to be included in the closing package into P260 not more than 2 business days after the closing is completed. A Closing Package shall include:

(i) The original HUD-1 and, if applicable, an invoice for any amounts advanced by the Contractor on HUD’s behalf

(ii) Original dated wire transfer confirmation

(iii) A copy of the tax certificate or locally acceptable proof that taxes were paid;

(iv) A copy of the deed and evidence that the deed was delivered for recordation

(v) A copy of all applicable invoices or receipts of disbursements.

(vi) The Contractor’s certification that all payments and deductions from the closing (including the Contractor’s fee) have been paid from the funds deposited in the escrow account containing the closing proceeds, and a statement that all actions have occurred on time and no liquidated damages should be assessed or an estimation by the Contractor of liquidated damages that…