New Jersey S 2402: Requires Higher Education Student Assistance Authority to suspend accrual of interest on certain New Jersey College Loans to Assist State Students Loan Program loans in deferment or forbearance.

Bill Text

SENATE, No. 2402

STATE OF NEW JERSEY
220th LEGISLATURE

INTRODUCED MARCH 24, 2022

Sponsored by:
Senator NILSA I. CRUZ-PEREZ
District 5 (Camden and Gloucester)

SYNOPSIS
Requires Higher Education Student Assistance Authority to suspend accrual
of interest on certain New Jersey College Loans to Assist State Students Loan
Program loans in deferment or forbearance.

CURRENT VERSION OF TEXT
As introduced.

S2402 CRUZ-PEREZ
2

AN ACT concerning the suspension of interest under the New Jersey 1
College Loans to Assist State Students Loan Program. 2
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BE IT ENACTED by the Senate and General Assembly of the State 4
of New Jersey: 5
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1. The Higher Education Student Assistance Authority shall 7
suspend the accrual of interest on a New Jersey College Loans to 8
Assist State Students Loan Program loan, if the borrower of the 9
loan applies for a loan deferment or loan forbearance due to 10
temporary total disability, unemployment, or financial hardship 11
between March 9, 2020 and September 9, 2020, and is approved for 12
such a loan deferment or loan forbearance. 13
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2. This act shall take effect immediately. 15
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STATEMENT 18
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Under current regulations governing the New Jersey College 20
Loans to Assist State Student (NJCLASS) Loan Program, the 21
Higher Education Student Assistance Authority (HESAA) is 22
permitted to grant NJCLASS loan borrowers deferment or 23
forbearance under certain circumstances in the repayment of 24
NJCLASS loans. During periods of authorized deferment, 25
borrowers may be permitted to defer payments of interest and/or 26
loan principal for specified periods of time. Borrowers, however, 27
remain responsible for the payment of the interest accruing on their 28
loan, except for during approved periods of temporary total 29
disability of the eligible student borrower. Forbearance, 30
meanwhile, may be granted to a borrower for situations including, 31
but not limited to, financial hardship. In granting a forbearance, 32
HESAA permits: 1) a temporary cessation of principal payments 33
and temporarily permits payments of interest only or 2) a temporary 34
cessation of both principal and interest payments. Interest 35
continues to accrue during all forbearance periods. 36
This bill would require HESAA to suspend the accrual of interest 37
on NJCLASS loans, the borrowers of which apply for a loan 38
deferment or loan forbearance due to temporary total disability, 39
unemployment, or financial hardship between March 9, 2020 and 40
September 9, 2020, and are approved for the loan deferment or loan 41
forbearance. 42