New Jersey Statutes Title 18A. Education 18A § 71C-31.5

a. To provide further assistance to borrowers who continue to face economic hardships after exhausting their eligibility for the Repayment Assistance Program, the Higher Education Student Assistance Authority shall establish a Household Income Affordable Repayment Plan for new loans originated under the Standard NJCLASS Loan Program beginning with the 2018-2019 academic year. Subject to the limits of funding made available pursuant to section 3 of this act  1, a borrower shall be eligible for the Household Income Affordable Repayment Plan upon exhausting the two-year eligibility period for the Repayment Assistance Program. Under the Household Income Affordable Repayment Plan, an eligible borrower shall be eligible to make reduced loan payments equal to 15 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 $25.

b. Upon qualification for admittance to the Household Income Affordable Repayment Plan, the repayment term for a loan in the plan shall be extended to 25 years from the date of origination. Interest shall continue to accrue on the loan while in repayment under the plan at the original loan rate. Any remaining balance at the end of 25 years shall be forgiven.

c. All parties to a loan shall provide the authority with annual income certification and proof of need to remain in the Household Income Affordable Repayment Plan. In the event that the parties to a loan no longer qualify for participation in the plan, the repayment term shall remain at 25 years and the monthly repayment amount shall revert to the standard monthly payment. Unpaid interest shall be capitalized upon return to the standard monthly payment.

d. As used in this section, “standard monthly payments” are determined by the authority when parties enter the Household Income Affordable Repayment Plan by capitalizing all unpaid interest and amortizing the remaining loan balance over the remaining original loan repayment term.

e. 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 Household Income Affordable Repayment Plan established in this section.