Arkansas Foreclosure Prevention Efforts
For 2009, Arkansas ranked 23rd among all states in foreclosure rate, an increase of 15.9% from the year before. Nationally, 2009 was the worse year for foreclosures in US history, with 2.8 million property owners receiving a foreclosure notice.
Arkansas foreclosures are handled both in court and out of court. In the state foreclosures typically take between 3 and 4 months.
In a judicial foreclosure, the court determines the amount owed and gives the borrower a short time to pay the debt to the lender. If the borrower fails to pay the full amount owed within that period, then the property goes up for sale, usually about 30 days later.
If the property is foreclosed through the courts, the borrower has one year from the date of the sale to redeem the property, provided that s/he pays the amount of the purchase price at the auction plus interest.
A non judicial foreclosure can be used when the mortgage documents contain a power of sale clause. To begin the process, the lender files a notice of default with the county recorder. The notice of default and sale must be then be mailed within 30 days to the borrower with the time, date, and place of the sale with the mandatory warning “YOU MAY LOSE YOUR PROPERTY IF YOU DO NOT TAKE IMMEDIATE ACTION.” A homeowner can stop the sale any time before the auction by paying off the entire amount owed plus costs.
With a non judicial foreclosure a lender can sue the borrower for a deficiency judgment within 12 months of the sale.
On March 24, 2009 the Arkansas legislature adopted a resolution to urge mortgage lenders in the state to adopt a 90 day moratorium on all residential foreclosures and to work with borrowers to adjust the interest rates on loans with high interest rates.
On March 30, 2009, Governor Beebe signed Senate Bill 396 which created a state housing trust fund and advisory committee to encourage affordable housing in the state and contribute to foreclosure prevention counseling. The Arkansas Development Finance Authority (ADFA) is administering the fund.
The Arkansas Coalition of Housing and Neighborhood Growth for Empowerment (ACHANGE) suggests that residents of the state who are having trouble making their mortgage payments, turn to this US Federal Trade Commission reference page.
For free foreclosure legal assistance to low income Arkansas residents, contact Arkansas Legal Services Partnership.
Here’s a list of free or low cost US Department of Housing and Urban Development (HUD) approved Housing Counselors in Arkansas.
For complaints regarding predatory lending and mortgage fraud contact the Arkansas Attorney General’s Office:
Attorney General’s Office
Address: 200 Tower Building
323 Center St.
Little Rock, AR 72201-2610
(501) 682-2007 phone
501) 682-8084 fax
