§ 15-5-1108 - Claims for reimbursement of losses -- Amounts subject to reimbursement.
15-5-1108. Claims for reimbursement of losses -- Amounts subject to reimbursement.
(a) The Arkansas Development Finance Authority shall establish procedures under which financial institutions participating in the Arkansas Capital Access Program for Small Business may submit claims for reimbursement for losses incurred as a result of qualified loan defaults.
(b) Costs for which a financial institution may be reimbursed from its loss reserve account include loan principal, accrued interest on the principal, actual and necessary costs of seeking recovery of the principal amount and interest thereon, and any other related costs.
(c) (1) A financial institution may seek reimbursement of loan losses prior to the liquidation of collateral from defaulted loans.
(2) The financial institution shall repay its loss reserve account for any moneys received as reimbursement under this section if the financial institution recovers moneys from the borrower or from the liquidation of collateral for the defaulted loan.