4. a. There is hereby established in the agency the “New Jersey Senior and Disabled Cooperative Housing Finance Incentive Program” for the purpose of assisting the financing of eligible projects and for making loans to any eligible purchaser of a dwelling unit in an eligible project pursuant to P.L.1998, c.128 (C. 55:14K-72 et seq.) out of the Senior and Disabled Cooperative Incentive Fund created pursuant to section 6 of P.L.1998, c.128 (C. 55:14K-77).

For the purposes of this act, any project undertaken by a qualified housing sponsor may include, but shall not be limited to, projects in which seniors or persons with disability reside in: an apartment unit in a small complex with a community room for informal gatherings; or a home within which the individual has a private bedroom or bedroom sitting area and shares common areas, housekeeping chores, and some meals regardless of whether the housing is produced for home ownership or rental. These living arrangements may also allow for the provision of housekeeping services and meals by professional workers with the sharing of the associated costs by residents.

b. Loans made to an eligible purchaser pursuant to subsection a. of this section shall be subject to the following conditions: (1) the unit is to be occupied as the principal place of residence of the eligible purchaser; and (2) that purchaser has entered into an agreement with a qualified housing sponsor to participate in the program. Loans shall also be made to qualified housing sponsors that will sponsor and manage cooperative housing for older adults.

Loans made pursuant to this subsection shall be made only to pre-qualified home purchasers whose eligibility for such loans under the terms of P.L.1998, c.128 (C. 55:14K-72 et seq.) has been determined by the agency.

c. A loan made to an eligible purchaser out of funds made available pursuant to P.L.1998, c.128 (C. 55:14K-72 et seq.) shall be secured by a mortgage held by the agency. The mortgage shall be secured by the property purchased by the eligible purchaser and shall be amortized monthly.

The loan shall be repayable in full upon sale, lease or other transfer of the property resulting in that property’s ceasing to be the principal residence of that purchaser; except that such eligible purchaser shall be entitled at any prior time, and without ceasing to maintain the property as his principal residence, to make repayment in whole or part. The agency may forbear the payment of interest to the extent it deems prudent and as may be permitted by the conditions of the bonds in any case in which it finds good cause and that the exaction of such payment would work an exceptional hardship upon the borrower.

L.1998,c.128,s.4.