N.J. Stat. Ann. § 55:17-1 et seq. § 55:17-5
Nature, identity or status of person with whom lease or financial agreement may be made
Operative Text
Limiting and restrictive provisions of any statute otherwise applicable, in respect to the nature, identity or status of any person with whom a lease or financial agreement may be lawfully made shall be applied to the project only, in case of a default or foreclosure, and shall not be applicable to the holder of the mortgage loan. L.1967, c. 304, s. 5, eff. Feb. 15, 1968.
Under N.J.S.A. 55:17-1 et seq. § 55:17-5, any statutory restrictions on the types of persons or entities that can enter into a lease or financial agreement are narrowed in scope when a mortgage loan is involved. Specifically, those restrictions apply only to the housing project itself in situations of default or foreclosure, and they do not bind the mortgage loan holder. This provision effectively carves out an exception so that lenders taking over a project through foreclosure are not subject to the same tenant-eligibility or contracting-identity rules that would otherwise govern the project.
Plain English — not legal advice.
Property owners and managers operating under a mortgage loan on a housing project should be aware that N.J.S.A. 55:17-1 et seq. § 55:17-5 limits how certain statutory tenant-eligibility or contracting restrictions apply. In a default or foreclosure scenario, those restrictions remain tied to the project itself but do not extend to the mortgage holder. Compliant operators generally keep records that distinguish project-level obligations from the separate legal position of any lender, particularly when financing arrangements are restructured.
General guidance for property managers — not legal advice for your specific situation. Consult an attorney for advice on your case.
N.J.S.A. 55:17-1 et seq. § 55:17-5 affects how tenant-eligibility and leasing rules apply when a housing project goes into default or foreclosure. While the project remains subject to applicable statutory restrictions, the mortgage loan holder is not bound by those same rules, which can affect who controls leasing decisions during or after a foreclosure. Tenants who believe their rights under applicable leasing statutes are being affected by a foreclosure situation may wish to consult a tenant-rights organization or legal aid provider familiar with New Jersey housing law for general information about available options.
General guidance for tenants — not legal advice for your specific situation. Consult a tenant-rights organization or attorney for advice on your case.
Generated October 6, 2026 — auto-generated, not yet human-reviewed. See /transparency for methodology.
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