Loan Servicing Support Services

THIS IS A SOURCES SOUGHT NOTICE ONLY This is not a solicitation or a request for proposal (RFP). It is not to be construed as a commitment by the government to issue a solicitation or ultimately award a contract. Any cost incurred as a result of this announcement shall be borne by the interested party and will not be charged to the government for reimbursement. This is a sources sought notice to determine the availability of interested, capable and qualified businesses and agencies that can provide these services. The Department of Housing and Urban Development (HUD) seeks to establish a contract under NAICS Code(s) 522390 Other Activities Related to Credit Intermediation. Small Business Standard is $5 Million, PSC Code R408 PROGRAM MANAGEMENT/SUPPORT SERVICES, for Loan Servicing Support Services. This contract will support HUD's National Servicing Center, Office of Single Family Asset Management which is issuing this Request For Information (RFI) in order to solicit responses from capable sources and capability statements to ensure sufficient competition exists to meet the government's requirements. Teaming arrangements and joint ventures will be considered for any subsequent procurement based on the Government's market research, provided that the prime contract is awarded to an applicable small business and that small businesses provide fifty-one percent or more of the support. Please review the General Scope of Work and provide your feedback to Christopher Stuart at [email protected]. BACKGROUND The services contemplated in this sources sought are required to assist the United States Department of Housing and Urban Development (HUD) in performing professional loan servicing support services for a wide range of FHA Insured and Secretary-held second and subordinate note and mortgage loans. The servicing functions support the following loan programs: Partial Claim mortgages, 235 Recapture and Nehemiah mortgages, Assignment Program mortgages, Asset Control Area (ACA) compliance and Enforcement mortgages, Purchase Money mortgages, Good Neighbor Next Door (GNND), Hope for Homeowners (H4H), Emergency Home Loan Program (EHLP), Department of Hawaiian Home Lands (DHHL) loans and other mortgage programs as implemented and assigned excluding HECM or Reverse Mortgage. 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 instances rehabilitation, of single-family homes. Although primarily a mortgage insurer, FHA also holds holder primary and subordinate mortgages as a result of its loss mitigation program, and other specialized loan programs. LOAN TYPES The following information provides a description of the loan types held and serviced by HUD's National Servicing Center, Office of Single Family Housing Asset Management Partial Claim (PC) Subordinate Mortgage: A Partial Claim is a loss mitigation tool available to delinquent eligible borrowers whereby HUD advances funds to the servicing lender to cover the delinquent arrearage for the borrower. In exchange, the borrower signs a subordinate note promising to pay HUD upon payoff or sale of the property. The note is held in the Secretary of HUD. This loan type is the majority of the Secretary Held Portfolio. There are approximately 400,000 subordinate partial claims in the portfolio with approximately 10,000 new Partial Claims per month added to the portfolio with about the same amount of loans terminated each month. The unpaid principle balance of the portfolio is $10 Billion. Assigned First Mortgages (Forward): First mortgages transferred to HUD through the former Assignment Program, which provided forbearance relief for delinquent borrowers. Assigned mortgages are serviced as traditional whole loans. Currently HUD holds 11 assigned loans No assigned loans are added. Purchase Money Mortgage (PMM): PMMs and Ferrell PMMs are direct loans from HUD to certain eligible borrowers and/or non-profit corporations. Approximately 10 loans. 235 Recapture Program: The former 235 Mortgage Subsidy program provided monthly assistance payments to help low income borrowers afford homeownership. The Housing and Community Development Acts of 1980 and 1981 that changed Section 235 of the National Housing Act requires the Secretary of HUD to recapture all or a portion of the subsidy assistance payments when the mortgage is terminated through payoff or sale of the property. There are approximately 6,715 loans. Nehemiah Program: The Nehemiah Program, which has been terminated by HUD, was a down payment assistance program. These loans carry a second mortgage requiring repayment of all or a portion of the subsidized amount paid by HUD on behalf of the borrower. Payment of these mortgages is due upon sale or payoff of the first mortgage. There are approximately 1200 loans Good Neighbor Next Door Program (GNND): As part of its commitment to preserve neighborhoods, HUD sells foreclosed homes in designated revitalization areas at a 50% discount to police offices, teachers, fire fighters and emergency medical personnel. Program participants must agree to occupy the subject properties for a period of three years. Program requirements call for second mortgages on these loans as a means to secure compliance with the occupancy requirement. There are approximately 2,000 loans. Asset Control Area Program (ACA): This program provides for the discounted sale of HUD owned properties in designated revitalization areas to local government agencies or non-profit groups willing to rehabilitate the properties and resell them to income eligible borrowers who must agree to occupy the property for a defined period of time. The ACA program requires placement of two different second mortgages in a sequential order as a means to secure program compliance. There are approximately 66 loans. Hope for Homeowners (H4H): This program was introduced as part of The Housing and Economic Recovery Act of 2008 (HERA). Under this program, a borrower facing difficulty with his or her mortgage will be eligible to refinance into an affordable FHA-insured mortgage. At origination of an H4H mortgage prior to January 1, 2010, the borrower executed a Shared Equity note and mortgage (SEM) in favor of HUD with a fixed dollar amount inserted for initial equity. Initial equity is calculated as the difference between the HOPE mortgage balance and the appraised value at the time of HOPE loan origination. Based on the date of sale, disposition or refinance, HUD is entitled to a percentage of the initial equity pursuant to the schedule stated in the Shared Equity Mortgage. The SEM should be recorded as a second priority lien against the property. There are approximately 700 loans. Emergency Home Loan Program (EHLP): The Dodd-Frank Wall Street Reform and Consumer Protection Act provided $1 billion to the U.S. Department of Housing and Urban Development (HUD) to implement the Emergency Homeowners' Loan Program (EHLP). The program offers a declining balance, deferred payment loan (non-recourse, subordinate loan with zero interest) for up to $50,000 to assist eligible homeowners with payments of arrearages, Lender inspection fees, when required under FHA regulations (24 CFR 203.377) for properties with FHA-insured mortgages that are in default. In addition to payment of arrearages, EHLP funds will also be used to assist eligible borrowers to make payments of principal, interest, taxes and insurance (PITI) owed on their first mortgage. After the first payment is made on behalf of the borrower, the fiscal agent will create an open-ended "HUD Note" and mortgage in the name of the Secretary of the HUD of sufficient size to accommodate the expected amount of the assistance to be provided to homeowner. There are approximately 8,000 loans. Department of Hawaiian Homelands (DHHL) Loans: FHA insures loans made to Native Hawaiians to purchase one- to four-family dwellings located on Hawaiian Home Lands. Regulations pertaining to these loans are the same as Section 203(b) loans except that the Section 247 loans are only available to Native Hawaiians on Hawaiian Home Lands. The land is leased from the State of Hawaii. Once a DHHL loan reaches 180 days of delinquency and loss mitigations options have been exhausted then the mortgage and note are assigned to HUD and a claim is paid to the Servicer. The mortgage and note are then assigned to DHHL for more flexible and individualized loss mitigation. There are approximately 3,000 loans. GENERAL SCOPE OF WORK The Contractor shall furnish all necessary services, equipment, materials, licenses, supplies, facilities, personnel, and supervision to accomplish the tasks as specified unless otherwise directed. Provide a centralized customer service call support operation to support approximately 8,000 calls per month. This Customer Service support operation is to provide customer service, technical assistance, and assistance to mortgagors and lenders in a consultative manner, specifically in the area of Loss Mitigation and Loan Servicing issues and support services to HUD's National Servicing Center. Advanced telephone and telecommunication equipment supported with customer service call center software provides computer and telephone routing and transfer services, sophisticated data gathering and reporting capabilities, workload routing capabilities and essential IT support. Perform comprehensive loan servicing activities according to 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. Loan servicing activities include those financial and non-financial actions necessary to make sure that the portfolio of loans are 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 according to the Fair Debt Collection Practices Act, disbursement of payments, annual recertification, foreclosure activities, bankruptcy activities, compliance monitoring, enforcement monitoring, preparation and recording of releases /and or satisfaction of mortgages, and providing payoffs, proof of claims, certificate of indebtedness, subordination approvals, along with processing assignments and re-conveyances. Maintain complete and accurate physical and electronic servicing files. Track the receipt of legal instruments and verify that these legal instruments are completed in compliance with program requirements. Retain original legal documents and security instruments. The Servicing lender is required to send the original subordinate note and recorded subordinate partial claim mortgage/deed of trust to the contractor within 6 months of the date of execution, unless there is an approved extension. If the documents are not received within the proper timeframe, the contractor shall perform research to determine if the lender should be billed for any Incentive Fee and/or for the full amount of the Partial Claim. Generate and distribute a partial claim notes and mortgage missing document report to Servicing Lenders each month (approximately 20,000 loans) Prepare demand letters and bill the servicing lender for re-payment of incentive fees and the full amount of the subordinate partial claims (if applicable) in accordance with HUD's standard operating procedures. Draft and record releases for approximately 1,500 subordinate partial claim mortgages a month. Additionally prepare and file Proof of Claims for bankruptcies, Certificate of Indebtedness in foreclosures, and Payoff Statement requests when received. Develop standard reports including but not limited to trends, accomplishments, issues, status, customer service, timeliness, abandoned, voicemail, telecommunication, and summary reports. CONTEMPLATED PLACE OF PERFORMANCE Performance will be at the contractor's location within 50 miles of the Oklahoma City HUD Field Office. RESPONSE REQUESTED Small Businesses are encouraged to respond. This synopsis is a market research tool being used to determine the availability and capability of potential sources prior to determining the method of acquisition and whether the government will proceed with this acquisition. The Government will not pay for any information solicited. If a contract is ultimately pursued, responses to this synopsis will be used to aid in determining whether the acquisition is set-aside for small business or in establishing small business subcontracting goals. All qualified firms are encouraged to respond. The capability statement shall address, at a minimum, the following for the past three years: 1. Name and address of company and or companies (if there is a teaming arrangement or joint venture); 2. Technical expertise relevant to the requirement; 3. Technical approach relevant of the requirement (1 to 2 paragraphs); 4. Management approach relevant to the requirement (1 to 2 paragraph); 5. Corporate experience relevant to the requirement (1 to 2 paragraph); 6. Indicate if you are a small business or any other socio-economic categories that apply to your firm under the designated NAICS code; 7. Relevant past performance. Your capability statement needs to include a list of three customers (Government/non-Government) within the past three (3) years highlighting similar work in nature, scope, complexity, and difficulty and a brief description of the scope of work. Your submission for relevant past performance must include for each customer: • Contract name; • Contracting Agency or Department, POC and contact information; • Yearly contract value (in $); • Whether your firm was the prime or a subcontractor; • Period of performance; • Description of work and how it relates to the requirements. Interested firms responding to this market survey must provide a capability statement demonstrating their experience, skills and capability to fulfill the Governments requirements for the above. The capability statement shall be in sufficient enough detail, but not exceed 3 pages TOTAL, so that the Government can determine the experience and capability of your firm to provide the requirements above. Please specify one primary and one alternate Point of Contact (POC) within your firm, including telephone numbers and email addresses in case clarifications of your submission are needed. Only electronic copies of capability statements will be accepted and should be emailed to: [email protected]. The e-mail shall contain the following subject line: Response to Sources Sought Notice -Loan Servicing Support Services Requirement. The Government may use the responses received to determine whether to proceed with the acquisition as a set-aside, or in the absence of a least two small business responses to this notice, may determine to proceed with a full and open competition. This decision and whether to proceed with the acquisition is at the sole discretion of the Government. All interested contractors should submit their capability statements by 4:00 pm Mountain Standard Time on April 15, 2016, attention POC Christopher Stuart. Late responses will not be considered.