On Mar. 18, ARK LEG enacted bill on foreclosure attorney fee recovery.
ARK LEG enacted bill HB 1238 on attorney's fees recovery in certain circumstances.
Amends ARK FIN 18-50 on foreclosures by adding new section on recovery of fees.
Bill Provisions
A mortgagor may recover reasonable attorney's fees if a court sets aside the statutory foreclosure sale due to mortgagee’s failure to comply with the foreclosure provisions.
Shall not be awarded attorney's fees if mortgagor and mortgagee reach a mutual resolution of debt and corresponding foreclosure, or if the mortgage is reinstated.
Or if mortgagor files petition for bankruptcy while foreclosure, litigation is pending, or mortgagee instituted foreclosure while relying on title that was found to be in error.
Also if mortgagee instituted foreclosure in good faith without knowledge of unrecorded debt on subject property, or of assessments, taxes, or liens filed against the property.
Legislative History
On Jan. 27, 2025, bill was introduced in House; on Jan. 30, 2025, bill passed House.
On Jan. 30, 2025, bill was introduced in Senate; on Mar. 10, 2025, bill passed Senate.
On Mar. 18, 2025, bill was approved by the governor and was assigned Act 306.
Effectiveness
Act effective 91 days after legislature adjourned sine die (May 5), so Aug. 4, 2025.
Regulators
ARK LEG
Entity Types
Bank; CNSM; MG Orig; Servicer
Reference
Act 306, Bill HB1238, 3/18/2025; Citation: ARK FIN 18-50;
