HB1238

House Bill 1238 amends Arkansas statutory foreclosure law to permit a mortgagor to recover reasonable attorney's fees under specific conditions. Specifically, these fees can be awarded if a court invalidates a statutory foreclosure sale because the mortgagee failed to strictly comply with the established statutory requirements. However, the bill outlines several exceptions where attorney's fees cannot be recovered. These exceptions include cases where the parties reach a mutual resolution, the mortgagor files for bankruptcy, the foreclosure was initiated in good faith based on erroneous title insurance, or the mortgagee acted in good faith without knowledge of specific unrecorded debts, liens, or taxes. Additionally, fees are not recoverable if the mortgage is reinstated. The legislation aims to create a mechanism for fee recovery while providing safe harbors for mortgagees who act in good faith.