The bill amends the Fair Mortgage Lending Act to modernize and strengthen the regulatory framework governing mortgage lending and servicing in Arkansas. It introduces new definitions for key terms such as "Affiliate," "Allowable assets for liquidity," "Authorized user," and "Covered institution servicer," which clarify the roles and responsibilities of various entities involved in mortgage lending. The bill also updates the definition of "exempt person" to include certain government agencies and nonprofit organizations, while removing outdated references to specific dates, replacing "January 1, 2011" with "January 1, 2025" for certain exemptions. Additionally, it redefines terms like "loan officer" and "mortgage servicer," expanding their scope and ensuring regulatory clarity.

Furthermore, the bill establishes new requirements for financial institutions regarding risk management and information security programs. Covered institution servicers are mandated to conduct annual external audits and maintain robust risk management programs overseen by their boards of directors. The legislation also requires financial institutions to report annually on their information security programs and notify the Securities Commissioner of any consumer information breaches within 45 days. Additionally, it outlines the need for a written business continuity and disaster recovery plan, with an exemption for institutions managing customer information for fewer than 5,000 consumers. Overall, these amendments aim to enhance consumer protection and ensure the financial stability and accountability of mortgage servicers and financial institutions in Arkansas.

Statutes affected:
HB 1466: 23-39-502, 23-39-508, 23-39-504, 23-39-505(f), 23-39-505(g), 23-39-505, 23-39-506(f), 23-39-506
Act 262: 23-39-502, 23-39-508, 23-39-504, 23-39-505(f), 23-39-505(g), 23-39-505, 23-39-506(f), 23-39-506