ATTACHMENT_K_Answers_to_RPSC_Questions.docx

ATTACHMENT K – Answers Industry RPSC Questions.

1. Q: General: Has VA considered making the solicitation more accessible to small firms by unbundling the requirements. There is precedence which has been set by agencies like HUD, which not only has separated the contracts to allow small firms to compete but has also made the contract regional instead of national. I understand that this might cause the agency more work on the front end but would reduce VA's risk in terms of vendor compliance. Where there is only one firm responsible for providing all of the required services, VA is subject to additional risk and cost if the awarded firm fails to comply with the terms of the contract. I look forward to hearing your feedback and hope that you will seriously consider an alternate solicitation strategy.

A: This is not bundled requirement; it is a re-compete of a contract for the same services. VA has thoroughly considered splitting the requirements; however, VA has chosen to ameliorate the risk by managing a single contract. In order to provide opportunities, there is a socio economic factor included in the solicitation and there are small business goals.

2. Q: General: Is this contract currently being managed by Ocwen?

A: No. The current RPSC Contractor is Vendor Resource Management (VRM).

3. Q: General: Can you advise what the current contract price is being paid for each property?

A: Unfortunately, the Government cannot provide the current contract price being paid for each property.

4. Q: General: When will the RFP be released?

A: The final RFP will be released to www.fbo.gov, estimated January 2017.

5. Q: General: Is there an initial inspection fee per house?

A: No, the property preservation fee includes such costs. B.6 Price Cost Schedule CLIN 0001 provides a field for the offerors to complete for property preservation. What is included in property preservation can be found in Attachment F Property Preservation Flat Fee.

6. Q: General: What is the number of properties nationwide? (Estimate) A: For an estimate of active properties, please see charts under 1.5 REO and Portfolio Servicing Profile and Data, Table 2: Number of VA Acquired Properties Being Managed by State. As of 6/30/16 there were 6,994 active properties in the inventory. Please also see Question 88 below which provides updated loan counts for all loan types, by state, as of 12/1/16.

7. Q: General: How many regional offices are there and what states does each cover. (ex. Cleveland covers Indiana, Michigan, Ohio etc.) Is there a schematic that shows this information?

A: There are 9 VA Regional Loan Centers. Please visit http://www.benefits.va.gov/HOMELOANS/contact_rlc_info.asp for more information.

8. Q: The following functions are listed in section 1.2: escrow management, loan servicing, custodial duties, loan sale processing, document procurement and approval and completion of loan terminations. Please detail any other servicing functions expected of the Service Provider under Nation Portfolio Servicing.

A: VA is unclear on the specific question. All servicing functions required are stipulated and detailed in the RFP.

9. Q: Please define expectations for the following:

a. Custodial Duties

b. Document procurement and approval A: The Contractor will be responsible for the storage, maintenance and retrieval of all hard copy and imaged copies of custodial documents associated with all loan and property assets managed under this contract in accordance with VA’s Record Control Schedule (RCS). The Contractor shall image and store all documentation in electronic format that is indexed to simplify searches. This has been updated in the solicitation paragraph 5.6.3(8)

10. Q: According to Table 5, VA provides supplemental servicing on defaulted (Native American Direct Loans) NADL. Does this mean that servicer transfers NADL loans delinquent loans back to VA or will the VA be using the vendors servicing system to service and thus requires access?

A: No, there is no transfer of loans between VA and the Contractor. The Contractor’s servicing system will store all NADL information regardless of loan status (i.e. performing, delinquent, foreclosure, bankruptcy, etc). The Contractor and VA will continually and regularly update loan data/information in the vendors system throughout the life of the loan. In the event that a NADL foreclosure is being processed by The Department of Justice, updates provided will be manually copied into the awardee’s system by VA staff and/or awardee staff. The Service Provider shall provide read/write access to that servicing system for up to 20 VA employees.

11. Q: How many NADL loans are in the population?

A: Please see “Table 3: Number of Loans Currently Being Serviced & UPB by Loan Type”; charts under 1.5 REO and Portfolio Servicing Profile and Data. In the table where it lists Direct loans those are the NADL loans in the portfolio. Per that table, the portfolio contains 509 NADL loans as of 6/30/2016. Please also see Question 88 below which provides updated loan counts for all loan types, by state, as of 12/1/16. Please note that as of 12/1/16 there are 504 NADL loans in inventory.

12. Q: General: Does the VA handle loss mitigation and [Foreclosure] (FC) negotiations on NADL loans?

A: VA currently facilitates default servicing for NADL loans, but may elect to transfer this responsibility to the Contractor leveraging the terms established in the contract with the Contractor. With VA pre-approval, the Contractor is responsible for coordinating with the Department of Justice Intake Center to initiate foreclosure actions on NADL loans.

13. Q: Section 1.6.4. Please clarify “improve reporting”?

A: The Contractor shall take a proactive posture in assisting VA improve its reporting capabilities. The Contractor shall continually evaluate and improve reports produced under this award. VA will partner with the Contractor to review their recommendations concerning the consolidation of reports, improvement of formats, reliability, consistency, standardization, availability, provision of pivot tables, filters, etc, and ease of use. Over time, VA anticipates that additional data and technology advancements will become available. The Contractor shall incorporate industry standards and best practices throughout the period of performance. Recently, and at the recommendation of the Contractor, VA approved the consolidation of reports and redefined the logic used to generate a specific report based on a recommendation from the vendor.

14. Q: Section 5.0. Does the contract require separate dedicated supervisors for FC, LIT and Loss Mitigation?

A: Yes, the Contractor and the Contractor’s fee Attorneys at a minimum must provide full-time resources tasked with this program working within the following functions/departments. Section 5.c states “Supervisory staff for all foreclosure, litigation, and loss mitigation activities.” Therefore, the contract requires separate dedicated supervisors for FC, Litigation (LIT) and Loss Mitigation.

15. Q: Section 5.3.1. Does the 30 million collect interest for the contractor? When does this get returned?

A: These funds are not collected by the VA. These funds substantiate contractor liquidity necessary to fund property management activities since the contractor will not be reimbursed for costs incurred until after sale of the property. The contractor will be reimbursed throughout contract performance.

16. Q: Section 5.3.2. iii. What kind of penalties have been charged in the past and for how much?

A: To date VA has not levied penalties in connection with this section. However, VA reserves the right to levy the penalties as described in the solicitation should VA determine such are warranted.

17. Q: Section 5.3.2. iii. Who sets the initial list price that the 10% penalty is based off of? Why would this not be the actual list price at time of penalty?

A: The Contractor sets the initial list price. The initial list price establishes the Contractor self-determined opinion of the initial price of the property. VA considers the initial list price a valid bench mark for this penalty because it does not change, whereas there may be a series of subsequent list prices which could lead to conflict over which was the appropriate choice.

18. Q: Section 5.6.3 # 7. Requires transferable life of loan flood service contracts within 45 calendar days of assignment. To whom is the assignment being made?

A: The Contractor.

19. Q: Section 5.6.2 indicates data received for boarding. Is this list inclusive of the data we will receive? For example, property address is missing from the list in the RFP.

A: The list is not inclusive. The Contractor will receive everything they need to board a loan upon contract award. The data previously collected, and that will be subsequently boarded, by the Contractor, will include data and standards that are commonplace in the industry.

20. Q: Section 5.6.2. Is the 7 day boarding requirement as of the date of the final data received?

A: The 7 day boarding requirement is as of the date of the initial data feed from VA.

21. Q: Section 5.6.3 requires full tax search within 30 days of board. Our vendor performs searches within 45 days. Does this present a problem?

A: Yes, that would fail to comply with the requirements of the PWS. VA has determined that a 30-day window to complete tax searches is in the best interest of the Government to ensure that tax issues are addressed timely and in order to prevent any subsequent penalties, delinquencies, etc.

22. Q: Section 5.8. Why does the VA require administrator access and access to production environment to the vendor’s system?

A: VA has removed the requirement to have administrative access to administer VA-Access and replaced it with the following: The contractor shall implement changes to VA-access, such as the addition, modification or termination of access, within 1 business day of receipt.

23. Q: Section 5.8. Provide VA employees with capability to create on demand, ad hoc reports for any data element. Can VA provide a list of data elements?

A: Please refer to Attachment D, Reporting Library for a list of data elements for specified reports. These data elements should also be available for ad hoc reports. However, VA cannot provide a complete report of data elements as new elements may become necessary.

24. Q: Section 5.8. Is the VA seeking full system access to production environment in order to provide loan servicing on certain VA loans within the vendor’s loan servicing system? If so, what triggers a loan to be serviced by the VA?

A: VA requires access to the Contractors system of record so that the record can be updated to reflect any action VA took on the loan. VA makes every effort to enable the Contractor to service loans, however escalated cases, NADL delinquencies, politically sensitive cases and any/all borrower contact must be recorded directly into the system. VA will not accept a solution whereby updates are emailed, or otherwise transmitted, to the system. VA shall have direct access to the system. The “trigger” for the servicing of a VA loan is instruction from VA to the Contractor to board a loan.

25. Q: General: Do customer service reps need special training on VA suicide prevention?

A: Yes, the Contractor will need to train their customer service reps in regard to crisis escalation situations and/or suicide prevention. VA does provide access to certain network sites to facilitate support in these situations. Please review the following site: VeteransCrisisLine.net.

26. Q: General: What is the average duration of time a loan is serviced?

A: The National Portfolio is comprised of four different loan types. VA originates Vendee loans, which are the overwhelming majority of the portfolio, and holds those loans until they are securitized, so duration is dependent upon the timing of that transaction. (Note: VA suspended the origination of Vendee loans in 2012, but expects origination to resume in 2017. Similarly, VA suspended the securitization of Vendee product. The last Vendee securitization transaction occurred in 2011.) VA also originates NADL loans, but holds those until termination. VA acquires Repurchased loans, which are seasoned. Refunded loans are also acquired by VA, are at varying stages of seasoning, and are held to termination.

27. Q: On an average, outside of attachment F (Property Preservation Flat Fee), what was the annual and per asset cost charged to the VA for repairs (ie: environmental, structural repairs, capital improvements) A: VA does not track the environmental and structural repairs separately, however the capital improvements and reimbursable are provided.

Reimbursable cost for FY 2016 (including utilities): Annual cost = $66,267,017; per property = $4,663.

Capital Improvement cost for FY 2016: Annual cost = $3,983,729; per property = $280

28. Q: Given this is a best value award; is there a weighted percentage allocation for Technical, Past Performance, Socio-economic and price?

A: No, there is no weighted percentage that provides a numeric value for each rating factor. Rating factors, listed in descending order of importance, will be used to evaluate offers: Technical Approach, Past Performance, Socioeconomic Considerations, and Price. The non-price factors when combined are significantly more important than the Price Factor. Please reference Section E Instructions to Offers.

29. Q: What type of title package is required and how is timing determined?

A: VA periodically reviews and updates evidentiary requirements. Currently title packages include all documents specified in VA Circular 26-16-14 and Exhibit A. The circular can be found at http://www.benefits.va.gov/homeloans/resources_circulars.asp.

30. Q: General: What are the breakdowns by asset type - in particular mobile home properties?

A: The breakdown by asset type may be found in Table 3: Number of Loans Currently Being Serviced & UPB by Loan Type; please see charts under 1.5 REO and Portfolio Servicing Profile and Data. Mobile homes are not considered an asset type.

31. Q: General: What percentage of the assets are BIA (Bureau of Indian Affairs) properties?

A: As of December 1, 2016, there are 504 NADL loans in the National Portfolio. VA makes every effort to ensure home retention, often partnering with the Tribe, VA’s Office of Tribal Relations, BIA and other agencies. The Department of Justice processes foreclosures of NADL loans.

32. Q: On page 4, section B.1 (Contract Administration Data) Invoicing Instructions, does each team utilize the same invoicing platform or are they separate and distinct invoicing platforms?

A: Invoicing teams, invoicing processes and invoicing platforms used to approve invoices are different. Generally, Property Management invoices are more automated while Loan Servicing Invoices are manual and paper-based. VA may implement and deploy new invoicing processes and platforms at any time. During contract performance contractor will be notified via contract modification.

33. Q: Does the VA have an estimated time of the re-establishment of the Vendee loan program?

A: VA anticipates Vendee originations will resume in 2017, but cannot guarantee, or provide an estimated time when the Vendee loan program will be re-established.

34. Q: Page 20 & 68. Reference Section 5.3 General Requirements & Section C.5 52.228 PERFORMANCE AND PAYMENT BONDS - Can the VA provide more clarify on the payment and performance bond expectations? On Page 20 (Section 5.3 General Requirements #13), cites 60% / 60% and section C.5 52.228-16 PERFORMANCE AND PAYMENT BONDS—(b) references "TBD" on the payment bond.

A: The Contractor shall furnish a performance bond (Standard Form 1418) for the protection of the Government in an amount equal to 10 percent of the original contract price and a payment bond (Standard Form 17416) in an amount equal to 10 percent for the original contract price. The RFP reflects this in clause 52.228-16.

35. Q: Page 20. Will VA allow e-Signed Closing/Settlement Statements where states allow?

A: Yes, VA will allow for e-Signed Closing/Settlement Statements where states allow.

36. Q: Attachment A. Page 129. Reference Section 12.M & 12.N Roles and Responsibilities for the Requesting Agency and Servicing Agency - It is clear there are differences in USDA vs VA processes in various services. Is there any expectation that the processes will align?

A: VA and USDA requirements may be expected to remain distinct as described in Section 12. M and Section 12.N (Attachment A).

37. Q: Page 8 & 36. Reference Section 5.9 Customer Service to VA, VA Customers, and Constituents - cites offshore customer service is prohibited, however in Section 1.4 Contract Administration Oversight cites "No VA sensitive personal information (SPI), Personally Identifiable Information (PII), or Protected Health Information (PHI) may be stored, sent to, or accessed from outside the Continental United States. A breach of this condition shall be considered a material breach that may warrant a termination for default." These two sections seem to indicate that no segment can be performed offshore, however there are areas of the portfolio (e.g. Alaska, Hawaii, Guam, and Virgin Islands) that are not within the Continental United States and could be prohibited for work being perform there. Can VA offer more clarity around these expectations?

A: Upon further review, VA has revised Section 5.9. With VA prior approval, operations not within the Continental United States and its territories may be allowed. Proposals shall include detailed information concerning what operations will be offshored, if applicable, include control plans to mitigate risks associated with that model.

38. Q: Page 26. Reference Section 5.5 Vendee Origination - Within the Vendee program, will buyers be required to obtain an owners title policy?

A: No, VA does not require the purchaser to obtain an owners title policy.

39. Q: Page 26. Reference Section 5.5 Vendee Origination - Within the Vendee program, will the program follow standard borrower origination fee schedules in accordance to Consumer Financial Protection Board ( CFPB ) guidelines?

A: On October 26, 2016, VA published its proposal to implement certain vendee loan origination fees in Volume 81, No. 207 of the Federal Register. See 81 FR 74382. These origination fees are necessary to meet the vendee loan requirements set forth by 38 U.S.C. § 3733. Offerors should consult their legal counsel as to the applicability of other statutes and regulations to VA’s vendee loan program. VA notes that 38 U.S.C. § 3720(a) states that the Secretary of VA can sell or otherwise deal with any property acquired under Chapter 37 of title 38 “…notwithstanding the provisions of any other law…”

40. Q: Page 26. Reference Section 5.5 Vendee Origination - Within the Vendee program, how will the VA pay the originator on vendee loans?

A: The contractor shall invoice VA for the origination fee agreed upon in this contract as a line item on the After Sale Invoice. Refer to B.1 Contract Administration Data.

41. Q: Page 26. Reference Section 5.5 Vendee Origination - Within the Vendee program, does VA approve vendee loan applications?

A: No. The approval or disapproval of the loan application is part of the origination process that the contractor must perform.

42. Q: Page 26. Reference Section 5.5. Vendee Origination - Within the Vendee program and assuming VA must approve Vendee loan applicants what type of access will be needed to the originator's (Loan Origination System) LOS?

A: The approval or disapproval of the loan application is part of the origination process that the contractor must perform. VA will need access to the LOS in order to audit a percentage of the loans originated.

43. Q: Page 26. Reference Section 5.6.2 Boarding - Will VA be able to meet the requirements CFPB is mandating for new loan boarding’s of providing preliminary data 30 days in advance as well as providing loan documents at or before loan transfer for the servicer to review and recent loss mitigation activity performed or in flight with the previous servicer?

A: VA addressed this matter with CFPB in early 2016. Because of VA’s statutory mandate to acquire re-purchased loans and the authority to acquire Refunded loans, the 30-day requirement is not always possible. VA and CFPB have documented this matter and have the necessary agreements and contacts in place should this issue arise in the future.

44. Q: Page 30. Reference Section 5.6.6 Loan Termination - cites “Upload conveyance data to VA within five calendar days of final termination, when VA retains title to the security. Can VA define considerations for "Final Termination"? Does the servicer need to wait for redemption, ratification, and confirmation timeframes to expire?

A: VA has clarified this requirement in the PWS to state: “Upload conveyance data to within five calendar days of loan termination when VA retains title to the security. The conveyance period is subject to the official terminating event in the state for which the property is located be it foreclosure, ratification or confirmation.”

45. Page 39. Reference Section 11 Security, sub-section "VA Information Custodial Requirements" cites "all data shall be transferred to VBA upon contract completion". Can VA offer clarity if this includes all inactive loans or sold properties?

A: Upon contract completion, all data, including inactive loans and previously sold properties, will be delivered to VA.

46. Q: Page 39. Reference Section 11 Security, sub-section "VA Information Custodial Requirements" cites "The contractor shall not use technologies banned in VA meeting the requirements of the contract (e.g. Bluetooth-enabled devices)". Can VA provide a full list of banned technologies?

A: VA uses FIPS 140-2 encryption for all approved data transfers. Please refer to VA’s Technical Reference Manual (TRM) and the Prohibited Report available at http://trm.oit.va.gov/TRMHomePage.asp concerning “banned technologies”.

47. Q: Page 85. In Table 2 & 3, REO inventory & loan service is in conflict with Section "Volume IV-Price) (page 85 document #2) of the inventory standing at 10,000 of REO inventory and 10,000 Serving inventory. Which is the accurate current volume?

A: The 10,000 REO and 10,000 Servicing inventory counts is for evaluation purposes only and will only be used to evaluate price proposals. The amounts in Table 2 and 3 is the inventory as of the date specified.

48. Q: Page 138. Reference Section “CONVEYANCE OF VA’S INTERESTS” (page 138 on document #3), Can VA confirm that this section applies to loans sold under the Vendee Trust Sale process?

A: Yes, VA confirms that Reference Section “CONVEYANCE OF VA’S INTERESTS” (page 138 on document #3 found in Attachment A RPSC Related Documents), applies to loans sold under the Vendee Trust Sale process.

49. Q: Page 142. Reference Section "Exceptions" (page 142 on document #3), citing "All VA NADLs and loans of any type under the jurisdiction of the Hawaii Regional Office shall be excluded from all processes described herein". This exception was lifted under the current contract. Is the intent by VA to restore this exception?

A: This requirement will be removed from the contract. The Hawaii Regional Office will be subject to these requirements.

50. Q: Page 27. Reference Section 5.6.3 Non-Default Servicing - Are the loans in this portfolio handled through [VA Loan Electronic Reporting Interface] VALERI using the same systems and process (except as noted) or are these loans handled differently?

A: Yes, these loans are handled differently. VALERI is not used in the servicing of National Portfolio Loans. Please refer to the solicitation documentation for policies, processes and procedures.

51. Q: Page 31. Does the Service Provider need to remit all suspense funds (partial payments) received to VA daily or can the servicer hold the funds to await a full payment?

A: The contractor shall remit all suspense funds, funds cannot be held.

52. Q: Page 20. Reference Section 5.3 General Requirements - In the event that a state or local government agency will not accept the VA’s CFR signing authority, is the VA open to establishing a POA?

A: No, VA is not aware of any exceptions to the VA’s signing authority.

53. Q: Page 45. Reference Section B.6 Price/Cost Schedule - Please explain the use of the terms “Legacy REO” and “Legacy PS” and/or describe the differences between a legacy REO versus any other type of REO as well as Legacy PS versus any other type of servicing that would be received. Upon conversion of the portfolio from the prior service provider, will all fees be paid to the new service provider in full or will the VA require a discounted fee on the conversion inventory?

A: VA has removed references to Legacy REO and Legacy PS from the solicitation. Fees collected for loan servicing functions will be prorated on a daily basis. For example, if the loan transfer is completed on 5/1/17, then the awardee will be entitled to bill, and receive payment for, servicing the portfolio during the entire month of May. However, if the loan transfer is completed on 5/16/17, then the awardee will only be entitled to collect 15 days of fees.

54. Q: Page 25. Reference Section 5.4.6 Marketing and Selling Property - Does the Service Provider pay a fee for the use of the CoreLogic Loan Safe Appraisal Management tool and what are the requirements for this tool's usage within the market value processes?

A: VA will remove the reference to the Core Logic Loan Safe Appraisal Management Tool. Section 5.4.6.2 will be changed to read as follows: “Conduct market analysis for each property and obtain an initial market value property appraisal upon assignment, conducted by a licensed or certified appraiser from the property’s local market which meets the requirements of federally related transactions. Provide to the VA evidence that appraisals are reviewed for consistency and accuracy.”

55. Q: Page 26. Reference Section 5.5 Vendee Origination - Within the Vendee Program, how is the interest rate established?

A: VA unilaterally sets the Vendee and NADL interest rates. Historically, rate adjustments have trailed the market in 25bps increments.

56. Page 26. Reference Section 5.5 Vendee Origination - Within the Vendee Program, does VA fund at the closing table?

A: Yes, within the Vendee Program, VA funds at the closing table.

57. Q: Page 26. Reference Section 5.5 Vendee Origination - Within the Vendee Program, who owns the pipeline hedging/fallout risk?

A: The contractor assumes all pipeline hedging and fallout risk prior to closing. The Contractor is paid post-closing and only if the loan closes. If the loan does not close, the Contractor will not collect a fee or be reimbursed for any expenses incurred to initiate or process the failed origination.

58. Q: Page 15. Reference Section 3 Scope of Work - Is the current technology platform used for VA REO asset management eligible to be licensed to the service provider selected for this contract award?

A: No, the current technology platform is a proprietary system that is owned by the current contractor.

59. Q: Page 14; 2. Applicable Documents. The solicitation requires the incorporation of several documents. We could not access some of the applicable documents. Could VA please provide alternate links or the associated documentation for the following subsections:

B. VA Directive 6500H.

VA Information and Information System Security/Privacy Requirements for IT Contracts A: VA 6500 is located at: www1.va.gov/vapubs/viewPublication.asp?Pub_ID=56.

Appendix A of 6500.6 provides additional Contract Security requirements.

60. Q: Page 11; 1.6 Program Objectives. VA requires that the Service Provider must make prudent and appropriate business decisions that serve the interests of VA and adhere to the constraints of this procurement and all appropriate laws and regulations. Could VA provide some more information on what constitutes an ideal service provider? Are there any aspects about the incumbent provider that could be improved upon?

A: VA will not disclose information concerning the incumbents’ performance. The offeror should propose in accordance with the criteria set forth and will be rated based on the evaluation criteria.

61. Q: Attachment E. Provide authorized VA personnel and systems with real time, 24 hours a day, 7 days a week, secured internet, and direct connection access to all production data and records. The system shall be compatible with Internet Explorer 7 and also provide response times acceptable to VA. Could VA please clarify what is deemed as an acceptable response time? Would this response time change or vary based on the data sets being processed?

A: Response times should be in accordance with industry standards. VA acknowledges that large requests requiring large amounts of processing will result in slower response times.

62. Page 19; 5.3.1. $30 million in corporate funds/line of credit to perform contract tasks. Could VA please clarify this requirement: for example, would VA prefer balance sheet or dedicated escrow cash?

A: The contractor is required to provide a document from a creditable financial institution demonstrating they have corporate funds or an existing line of credit no less than $30 million available to manage their operation without requiring any financing from VA in advance of the sale of the properties. Pre-approval or contingent approvals of this line of credit will NOT be accepted.

63. Q: Page 20; 5.3.13. Performance and Payment bond equal to 60% of base year award value: SF 1418 and 1416. How much is base year award value? How is this value calculated? Is this in addition to the 30M fund requirement?

A: The base year award amount will be based on the proposed amount. The Contractor shall furnish a performance bond (Standard Form 1418) for the protection of the Government in an amount equal to 10 percent of the original contract price and a payment bond (Standard Form 1416) in an amount equal to 10 percent of the original contract price. They are separate from the $30 million.

64. Q: Page 9; 1.5 Table 1. Property Sales Table. Can VA please provide a breakdown by Property Type? # of Mobile Home Properties? # of BIA Properties?

A: VA does not track this type of breakdown of our property sales.

65. Q: Page 23; 5.4.2. Acquiring title: submit complete title package to VA Regional Counsel and obtain VA Counsel approval to gain marketable title. Could VA please confirm that the service provided can utilize affiliates for title, property preservation, inspection, valuations, brokerage, auction, eviction, etc.? In which cases are the use of affiliated companies prohibited?

A: VA does not prohibit the use of affiliates, but all affiliates must be disclosed in the Contractors offer.

66. Q: Page 38; 11. All Contractor and subcontractor personnel requiring access to VA info and systems must complete training on National Rules of Behavior, VA Privacy Awareness, VA Information Security Awareness, and Cybersecurity and privacy training. Could VA confirm if service provider is required to re-certify vendors or can prior reviews satisfy the requirements?

A: All users are required to complete stated training (National Rules of Behavior, VA Privacy Awareness, VA Information Security Awareness, and Cybersecurity and privacy training) and it is to be completed annually.

67. Q: General: Does the data provided by VA include loans referred to VA from the USDA? Can auction be used? What is the USDA volume?

A: No the data does not include the loans from USDA. VA does not prohibit auctions, but VA expects to approve any auction protocol implemented by the contractor. The annual volume of USDA properties for 2016 was 1202.

68. Q: General: Can VA provide clarity regarding future inflow of assets from the USDA to VA? Can auction be used?

A: Currently monthly inflow approximately ranges from 50 – 80 of new assets. Yes auctions can be used if the contractor proposes using auctions. VA written prior approval is required for any auction protocol implemented by the contractor.

69. Q: General: Can VA provide loan level details for USDA Assets?

A: VA handles a portion of USDA properties, not USDA loans. The average sales price per property is $54,759. The volume by state is provided below:

70. Q: Page 23; 5.4.1. 3. Obtain flood hazard determination for each property for sales disclosure. Can VA provide clarification at what point in the process is the flood determination obtained?

A: VA requires the flood hazard determination to be obtained prior to the sales disclosures being sent to the buyer.

71. Q: Unclear Page or document. #35. VA Scorecard FCL sales report. Can VA please provide any additional information related to current contractor's performance and scorecard?

A: No, VA cannot disclose to current contractor's performance.

72. Q: Unclear Page or document. #35. VA Scorecard FCL sales report. Can VA provide a current sample of the scorecard that is used for Mortgage Servicing?

A: VA unclear on the question.

73. Q: Unclear Page or document. #35. VA Scorecard FCL sales report. Can VA provide a current sample of the scorecard that is used for all Real Estate related activities?

A: VA is unclear on the question.

74. Q: Unclear Page or document. #3. VA Equator Reconciliation. Can VA please confirm what system of record is required for this opportunity? EQUATOR is mentioned. Are other systems applicable? Can VA please confirm that MSP or FISERV is allowed as the system of record for Mortgage Servicing? Can VA please confirm what system / technology integrations are necessary for this opportunity?

A: Equator was the system of record previously, but is not required to meet the requirements of this PWS. VA does not dictate any mandatory system only that the system used shall meet industry standards.

75. Q: Page 43; Acronym List. Can VA confirm whether NIST certification (or other applicable certifications) are needed for eligibility as it relates to this opportunity?

A: Please refer to requirements in the solicitation and all attached documentation.

76. Q: Page 24; 5.4.6. Sell to VA-approved homeless providers at discounts. Can VA confirm if there is a goal or requirement to sell assets to homeless shelter programs or similar? Can VA please confirm what title fees are allowable under this contract?

A: At this time, there is no goal (volume, dollar amount or otherwise) but there is a requirement as stipulated in the solicitation to accommodate sales to homeless providers. Please refer to VA Handbook 2602, which can be found in Part 3, Attachment A, RPSC Related Documents. Title fees are not allowable fees except as specified for vendee origination which are described in the link below. https://www.federalregister.gov/documents/2016/10/26/2016-25738/loan-guaranty-vendee-loan-fees

77. Q: General: Can VA confirm it allows CWCOT as part of the default management process?

A: No, VA does not allow Claims without Conveyance of Title (CWCOT).

78. Q: Page 31; 5.6.8. Provide financial records in a format that fully complies with the Credit Reform Act. Loan modifications shall be recorded in proper fund/cohort year with interfund reimbursements as required. Can VA provide clarity regarding reimbursements / servicing advances?

A: Reimbursements of expenses (Mostly related to Foreclosure) are billed monthly to VA. (National Portfolio Reimbursable, Not including Taxes). Servicing is billed monthly to VA separated by Performing and Non-Performing.

79. Q: Page 31; 5.6.8. Provide financial records in a format that fully complies with the Credit Reform Act. Loan modifications shall be recorded in proper fund/cohort year with interfund reimbursements as required. Can VA please confirm when are reimbursements / servicing advancements paid? At liquidation?

A: Reimbursements of expenses are billed monthly to VA.

80. Q: Page 7; 1.3. Direct Loans (Loan Type 1) - Typically created when VA issues loans directly to Veterans on Native American Trust Land under the Native American Direct Loans (NADL) Program. Can VA confirm it is possible to liquidate NADL properties?

A: VA retains the authority to foreclose on NADL loans and has previously executed that authority, although every effort is made to avoid this outcome. The Department of Justice processes these foreclosures on behalf of the VA.

81. Q: Page 26; 5.5. Vendee Origination. Can VA please share why at this time the Vendee Loan program is non-operational and what is the probability of this program becoming active?

A: The Vendee loan program is pending the outcome of the proposed Vendee regulations in 38 U.S.C. § 3733. VA intends to resume the Vendee program in 2017.

82. Q: Page 26; 5.5. General: Vendee Origination. Can VA please confirm the licensing requirements needed for origination of VA Loans? Is it required for the contractor to be licensed in EVERY state and US Territory? Is the use of correspondent lending relationships permitted?

A: The Contractor shall have the capability and legal authority to originate loans in all U.S. states and territories. The proposal submission must include evidence that demonstrates that the awardee is fully licensed and permitted, by any and all relevant regulatory authorities, as necessary to perform all the duties and responsibilities set forth herein. All licenses and permits shall be current, active, and valid for the entire period of performance. The awardee shall produce evidence of current, active, and valid licenses and permits, upon VA request, at any time during the period of performance. Lapses in current, active, and valid licensure or permits, or the awardee’s failure to provide timely evidence of such current, active, and valid licensure or permits, may constitute a breach of the awardee’s contract with VA, to be determined at VA’s sole discretion.

If the awardee subcontracts any work or contractual duty prior to its contract with VA or within forty five days (45) of its contract with VA, the awardee shall include in its proposal submission evidence of the binding relationship between the awardee and all of its subcontractors. If any work or contractual duty is subcontracted at any point during the period of performance, the awardee shall provide to VA evidence of the contractual relationship between the awardee and the subcontractor. Any and all subcontractors must have the legal authority to carry out all the duties and responsibilities for which the awardee has subcontracted in any jurisdiction covered by the subcontract. If the awardee subcontracts any work or contractual duty prior to its contract with VA or within forty five days (45) of its contract with VA, the awardee shall include in its proposal submission evidence that demonstrates that all subcontractors are fully licensed and permitted, by any and all relevant regulatory authorities, as necessary to perform any subcontracted duties and responsibilities set forth herein. All licenses and permits shall be current, active, and valid for the entire period of performance. The awardee shall produce evidence of current, active, and valid licenses and permits of all subcontractors, upon VA request, at any time during the period of performance. Lapses in any subcontractor’s current, active, and valid licensure or permits, or the awardee’s failure to provide timely to VA, evidence of such current, active, and valid licensure or permits, may constitute a breach of the awardee’s contract with VA, to be determined at VA’s sole discretion.

83. Q: Page 26; 5.5. Vendee Origination. Can VA confirm a sole and separate Vendee advertising plan (above and beyond an already in place Veteran advertising plan) is needed for the Vendee Program?

A: Yes, VA confirms that is a requirement. See deliverable 5.4.6(b)

84. Q: Page 30; 5.6.7. Loan Sale Assistance. Can VA clarify additional details regarding loan sales? Is this similar to the DASP / HUD SFLS Program?

A: The contractor’s role in loan sales is limited to data extracts, data transfer, reports and assignments as described in the PWS. Currently, the Vendee securitization program is suspended pending the promulgation of new regulations that will enable the origination of Vendee product to resume and VA to revisit the authority to bring these loans to market.

85. Q: Page 78; C. Proposal Submission. Does VA anticipate the final RFP being released during the 2016 Calendar year?

A: No. It is anticipated January 2017.

86. Q: Page 78; C. Proposal Submission. Does VA anticipate final delivery / due date of this RFP being in January, 2017? February 2017?

A: It is anticipated proposals will be due 30 days after final solicitation release.

87. Q: Page 78; C. Proposal Submission. Does VA anticipate that 30 days will be given to complete the RFP Process?

A: Yes.

88. Q: Page 9; 1.5 (Table 1). Property Sales Table. Can VA please provide loan level data or a breakdown of specific loan types serviced in each state?

A: See table:

89. Q: Pages 32 & 45; 5.7 & B.6. Invoice Process Price / Cost Schedule. Can VA clarify advances as a service provider as it relates to REO and other Real Estate Services? Do providers get paid / reimbursed by the prime contractor or directly from VA?

A: VA makes payments/reimburses the prime contractor. The prime contractor is responsible for paying/reimbursing their sub-contractors. The Government does not have privity of contract with subcontractors.

90. Q: Attachment H; Separate Line Item for REO Asset Management Fee and Incentive. Can VA clarify the parameters to qualify for the additional incentive referenced in attachment H? Please see the Incentive/Disincentive schedule in the PWS.

A: This is addressed in the chart in Attachment E labeled Performance Criteria, which provides columns. The column labeled Surveillance Method provides the methodology used to determine performance for that incentive. The Exceptional column describes the percentage rate that the contractor must exceed to qualify for the incentive. Not all categories are eligible for an incentive. Those which are have an entry under the column marked Incentive.

91. Q: Attachment E; LOAN GUARANTY SERVICE (LGY) REAL ESTATE OWNED PORTFOLIO SERVICING CONTRACT (RPSC). Can VA please provide clarity as to the discrepancy in numbers between the DRAFT RFP Document and the numbers stated in the QASP Document? The QASP document states 20,000 loans to be serviced and 15,000 REO Properties. The RFP states 6,994 REO Properties and 5,662 loans to be serviced.

A: The counts provided in the QASP were corrected to reflect the current inventory counts as stated in the RFP.

92. Q: Attachment E; LOAN GUARANTY SERVICE (LGY) REAL ESTATE OWNED PORTFOLIO SERVICING CONTRACT (RPSC). Can VA please provide additional information regarding the QASP Plan as it relates to the Incentive Plan? Can VA clarify the parameters needed to qualify for the additional incentive referenced in attachment E.

A: The chart in Attachment E labeled Performance Criteria provides columns. The column labeled Surveillance Method provides the methodology used to determine performance for that incentive. The Exceptional column describes the percentage rate that the contractor must exceed to qualify for the incentive. Not all categories are eligible for an incentive. Those which are eligible have an entry under the column marked Incentive.

93. Q: Page 26; Portfolio Loan Servicing. What is the Servicing System of record used by VA?

A: The contractor maintains all loan servicing data on behalf of VA.

94. Real-Estate Owned (REO) management and asset disposition;

a. Q: What types of organizations are conveying the REO back to the VA (banks, independent mortgage companies, etc.)?

A: Loan and mortgage servicers.

b. Q: Is there any geographic concentration in the portfolio?

A: VA has illustrated the geographic concentration in PWS 1.5 Table 2.

c. Q: Is the REO manager expected to follow up on custody and acquire the title?

A: VA expectation for the contractor is specified in 5.4.2 of the draft PWS.

d. Q: Does [contractor] pay the taxes and acquire the insurance on the REOs?

A: The contractor pays taxes as described in section 5.4.2 of the draft PWS and is reimbursed. The contractor is not responsible for insuring REO; VA self-insures its REO inventory.

e. Q: Would managing these properties include any follow ups to the former servicers of record to obtain the documents required to sell the property?

A: Yes see section 5.4.2 of the draft PWS.

f. Q: Would these properties have final claims paid and [Transfer of Custody] TOC’s completed?

A: VA accpets conveyance (TOC) from the Mortgage Servicer or holder. The TOC is the action that moves the property to the REO portfolio. Mortgage Servicers or holders have 365 days after the terminating event to submit their claim against the guaranty to VA.

g. Q: Is [contractor] required to complete VALERI maintenance?

A: No, REO and portfolio properties are not part of the VALERI contract.

h. Q: Who will handle claims inquiries and rebuttals from prior servicers while the property is in REO?

A: VA’s Loan Administration group will perform these activities.

95. Loan Servicing

a. Q: How did VA acquire the loans? What kind of institutions originated and previously serviced the loans?

A: VA has originated all loans in the National Portfolio and is the sole investor. Vendee loans are serviced by VA’s RPSC contractor until they are included in a securitization transaction. NADL loans are serviced through termination by the RPSC contractor. Repurchased loans were originated by VA, sold in a whole loan transaction to a third party, serviced by various mortgage servicers and then VA required the loans per regulation 36 CFR 4600. Refunded loans are normal VA Guaranteed loans, originated and serviced by industry and later acquired by VA.

b. Q: If contractor is servicing directly on behalf of VA, would we have delegated authority to make decisions on Loss mitigation products?

A: No. The contractor makes recommendations to VA which are approved, modified or rejected. While the VA has considered establishing guidelines that would set parameters around what actions could be automatically taken, this has not yet come to fruition. Any change in this process would require a modification to the PWS.

c. Q: Are reporting requirements different since these are VA owned loans?

A: Yes, reporting requirements are unique to this contract. For example, VALERI is not used to report on National Portfolio loans.