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HUD Reply To Pre And Post Conveyance Rules

This is the response to us from the Atlanta HUD POC pertaining to HUD  We were given permission to reprint and hope that it will better educate Contractors.  If you have any questions, as always, feel free to contact us directly!

The guidance that went out to our FSM contractors recently was as follows:

1.       The prime FSM contractor and any direct subcontractor to the prime that is performing functions not attributable to a specific property address have a complete ban on performing pre/post conveyance preservation for FHA properties in the area they are performing as an FSM.  This is logical, as the new structure assumes that a single contractor will be assigned all FHA REO inventory in a given area.

2.       Any subcontractors who are performing the direct property servicing functions (inspections, debris removal, grass cuts, winterization, repairs, etc.) will be prohibited from performing pre/post conveyance preservation services at the specific property address. This will require prime FSM contractors to have a mechanism for tracking and reporting as part of their established Property Management Plan.  This is likely where the affidavit is coming into play, as part of the FSM’s process for tracking.

If you have any other questions as they relate to the new FSMs, you may reach out to me, or to the Contracting Officer for the 6A (TN, MS and AL) area, Simone Terry, who I am copying on this response.


Craig Karnes

Director, M&M Acquisition Center

Office of the Chief Procurement Officer

US Department of Housing & Urban Development

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