1. a. In order to assist borrowers who are facing economic hardships, the Higher Education Student Assistance Authority shall establish a Repayment Assistance Program for new loans originated under the Standard New Jersey College Loans to Assist State Students (NJCLASS) Loan Program beginning with the 2017-2018 academic year. Under the Repayment Assistance Program, eligible borrowers shall pay a reduced monthly loan payment equal to 10 percent of the total of the aggregate household income of all of the parties to the loan that exceeds 150 percent of the federal poverty guidelines, with a minimum monthly payment of $5.

b. Subject to the limits of funding made available pursuant to section 3 of this act, a borrower shall be eligible to participate in the Repayment Assistance Program for a period not to exceed two years. During the period of participation in the Repayment Assistance Program, the authority shall pay the interest on the NJCLASS loan at the stated loan rate and the payments made by the borrower shall be applied to reduce the principal balance of the loan. At the end of the borrower’s participation in the Repayment Assistance Program, the new monthly repayment amount shall be recalculated based on the remaining principal balance of the loan, interest accruing thereon at the original stated loan rate, and the remaining length of the original term to repay the loan.

c. As used in this section, borrowers are determined to be facing an “economic hardship” if the monthly amount required to pay their Standard NJCLASS loans is higher than the monthly payment amount required under the Repayment Assistance Program established in this section.

L.2019, c.62, s.1.