As you are all aware PK Management has recently been awarded the HUD 3.6 Contract for our area here in East Tennessee (they actually were awarded several states under this contract). PK are the initials for the owner, Pedro Kolychkine. I recently had the opportunity to speak with him and his Chief Operating Officer (COO) Albert Martinez with respect to how the new contract is to be implemented here.
By-in-large, PKMG seemed somewhat interested in what Foreclosurepedia had to say. We advised we were concerned about what we felt was an excessive payout period on Invoicing: 75+ days. It was our understanding that this was to hopefully be reeled in somewhat. The issue of wanting to be listed on Personally Owned Vehicles (POV) as a Certificate Holder may be removed; however, we never really did get a commitment. As to having to pay them to do a Background Check ($25USD) that is rather written in stone. We call it the Pay to Play Policy. Sign of the times I suppose as I speculate that there is a pretty high profit margin embedded as a whole.
The major issue that concerns us the most, though, is the requirement for Errors and Omissions (E&O). We do business with a firm here in Knoxville which has been around 54 years and they told us they could not find a single company whom could meet the specifications that PK Management requires. E&O specific to the HPIR is a rather novel concept, at best, as there is neither a niche for this specific E&O nor does it square with Mortgage Field Inspection Services. We are in hopes that PK Management is able to refer us to a company which can provide this service as we are unable to find one after almost four (04) hours of phone calls. We contacted both Les Sternberg, Vendor Management Director and Mr. Martinez, COO, and will advise here as to the status.
Overall, PK Management strikes us as capable of handling the Contract. Albeit, PK Management seems to be at a bit at a loss to proffer any details of precisely they plan to integrate current contractors. With that said, this move seems to be the direction HUD will be taking in the future. Obviously, the pricing PK Management will pay reflects their ability to wrest the current Contract from other competitors. Overall, though, if PK Management farms out the work in an even manner the volume will NEVER make up for the cut in pay.
This article is mainly intended to introduce PK Management to those Contractors whom frequent our Blog and attend the East Tennessee Property Preservation Guild meetings. It is not an in depth article nor is it intended to do anything other than open up a line of communications between Contractors to discuss the viability of the new proposals.
It was mentioned at our last meeting that we should review options for preconveyance work in a worst case scenario. 63 contractors agreed so we will begin a series on this as time provides. Our understanding is that PK Management will have some kind of training in place on or after 01NOV12 with new orders issuing 01DEC12. This gives all of us a little bit of wiggle room.