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Bill Summary · HB 1238

Summary of House Bill 1238

Bill Information

  • Bill Number: HB 1238
  • Title: Relating to Manele Small Boat Harbor
  • Status: Referred to WAL, FIN, referral sheet 4
  • Introduced: January 27, 2025
  • Classification: Bill
  • Subject: Appropriation ($), DLNR, Manele Small Boat Harbor, Transportation

Purpose and Intent

House Bill 1238 aims to amend existing laws regarding statutory foreclosures in Arkansas. The primary intent of the bill is to allow mortgagors (borrowers) to recover reasonable attorney's fees under specific circumstances when a statutory foreclosure sale is set aside due to the mortgagee's (lender's) failure to comply with legal requirements.

Key Provisions

The bill introduces a new section to the Arkansas Code, specifically Title 18, Chapter 50, Subchapter 1, which includes the following provisions:

  1. Recovery of Fees:

    • A mortgagor may recover reasonable attorney's fees if a court sets aside a statutory foreclosure sale due to the mortgagee's non-compliance with any provision of the statutory foreclosure law (§ 18-50-101 et seq.).

  2. Exclusions for Fee Recovery:

    • The mortgagor is not entitled to recover attorney's fees if:
      • A mutual resolution of the debt and foreclosure is reached.
      • The mortgagor files for bankruptcy during the foreclosure process.
      • The mortgagee acted in good faith relying on a title insurance policy that was later found to be erroneous.
      • The mortgagee was unaware of unrecorded debts or subsequent liens on the property.
      • The mortgage is reinstated under § 18-50-114.

Who Would Be Affected

  • Mortgagors: Homeowners or borrowers facing foreclosure who may benefit from the ability to recover attorney's fees if their foreclosure sale is invalidated.
  • Mortgagees: Lenders who must ensure compliance with statutory requirements to avoid potential liability for attorney's fees.
  • Legal Professionals: Attorneys representing mortgagors or mortgagees may see changes in how they approach foreclosure cases.

Procedural Timeline

  • January 27, 2025: Bill introduced and referred to the Committee on Insurance & Commerce.
  • March 3, 2025: Amendment #1 adopted, which clarifies the provisions regarding fee recovery.
  • March 10, 2025: The bill passed in the Senate and was returned to the House for concurrence.
  • March 14, 2025: The bill was correctly enrolled and ordered transmitted to the Governor's Office.
  • March 18, 2025: Notification that HB 1238 is now Act 306.

This summary provides an overview of House Bill 1238, highlighting its purpose, key provisions, affected parties, and the legislative timeline for its passage.

Compiled from official sources — confirm details with the bill’s official record.

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