Few letters are scarier than a foreclosure notice. Your home is where your family lives, and the timeline can feel like it is moving faster than you can think. If you believe your lender or servicer has made mistakes, or did not follow the rules, it is important to understand how foreclosure works in Arkansas and to act quickly.
Two kinds of foreclosure in Arkansas
Statutory (non-judicial) foreclosure. Many Arkansas mortgages and deeds of trust allow the lender to foreclose without filing a lawsuit, by following the steps in Arkansas’s statutory foreclosure law. Under A.C.A. § 18-50-104, the lender must record a notice of default and intention to sell with the county recorder. That notice must be mailed to the borrower by certified and first-class mail within 30 days of recording, and the sale cannot happen until at least 60 days after the notice was recorded. Once a statutory foreclosure sale happens, redemption rights end (A.C.A. § 18-50-108). That is why timing matters so much.
Judicial foreclosure. The lender files a lawsuit in circuit court and the court orders a sale. Arkansas law gives a 12-month right to redeem after a judicial foreclosure sale, but most mortgages waive that right (A.C.A. § 18-49-106). Read your mortgage, or bring it to me, to see what yours says.
What can make a foreclosure wrongful?
A foreclosure may be challenged when the lender or servicer did not have the right to foreclose or did not follow the law or the loan documents. Examples can include:
- Payments that were made but not credited, or a default amount that was miscalculated
- Notices that were missing, late, or sent to the wrong address
- A sale scheduled before the required waiting period ran
- Problems with who holds the loan or has the right to foreclose
- Improperly signed or notarized documents
- Moving forward with foreclosure while a loan modification or other help was being reviewed in ways the rules don’t allow
Federal mortgage servicing rules also apply to many home loans. For example, they generally do not allow a servicer to start a foreclosure until the loan is more than 120 days past due, with some exceptions.
Not every foreclosure is wrongful. Sometimes the most useful help is an honest explanation of where you stand and what options remain, such as loss-mitigation programs, a modification, a sale, or a deed in lieu of foreclosure.
After a sale: deficiency limits
If the sale brings in less than you owe, the lender may seek a deficiency. After a statutory foreclosure, Arkansas limits that judgment. It cannot be more than the debt minus the greater of the property’s fair market value or the sale price (A.C.A. § 18-50-112).
What to bring
- Your mortgage or deed of trust and the promissory note
- Every letter and notice from your lender or servicer, with envelopes if you have them
- Payment records and bank statements
- Any loan modification applications and responses
- Notes of phone calls: dates, names, and what was said
Common questions
A sale date is already set. Is it too late?
Not necessarily, but time is short. Because redemption rights end after a statutory sale, call as soon as you can.
I’m going through a divorce. What happens to the house?
Foreclosure and divorce often overlap. Who keeps the house and who pays the mortgage are part of the divorce case. See my divorce page.
You can also see my civil litigation page or my other practice areas.
Facing foreclosure in Northeast Arkansas?
Call my office at 870.525.2191. Our phones are answered 24 hours a day, and Sara Beth or I will call you back. Office hours are Monday through Friday, 8:00 a.m. to 5:00 p.m., at 721 W. Matthews Ave in Jonesboro. You can also request a consultation online. Consultations are free and usually last about 30 minutes, and I’ll explain how fees work for your kind of case before you decide anything.
This page is general information about Arkansas law, not legal advice for your situation.