New Jersey § 53:5a-29

§ 53:5a-29.

Any member who has at least three years of service to the member's credit for which

the member has contributed as a member may borrow from the retirement system, an amount

equal to not more than 50% of the amount of the member's aggregate contributions,

but not less than $50.00; provided, that the amount so borrowed, together with interest

thereon, can be repaid by additional deductions from salary, not in excess of 25%

of the member's salary, made at the time the salary is paid to the member. The amount so borrowed, together with interest on any unpaid balance thereof, shall be repaid to the retirement system in equal

installments by deductions from the salary of the member at the time the salary is

paid or in such lump sum amount to repay the balance of the loan but such installments

shall be at least equal to the member's rate of contribution to the retirement system

and at least sufficient to repay the amount borrowed with interest thereon. Not more than two loans may be granted to any member in any calendar year. Notwithstanding any other law affecting the salary or compensation of any person

or persons to whom this act applies or shall apply, the additional deductions required

to repay the loan shall be made. The rate of interest for a loan requested by a member prior to the effective date

of P.L.2007, c. 92 ( C.43:15C-1 et al.) shall be 4% per annum on any unpaid balance thereof. For a loan requested after the effective date of that act, the rate of interest

per annum shall be a commercially reasonable rate as required by the Internal Revenue

Code to be determined by the State Treasurer on that effective date, and on January

1 of each calendar year thereafter. An administrative fee in an amount set by the State Treasurer for each calendar

year may be charged for any loan requested after the effective date of P.L.2007, c. 92 ( C.43:15C-1 et al.). Loans shall be made to a member from the member's aggregate contributions. The interest earned on such loans shall be treated in the same manner as interest

earned from investments of the retirement system. In the case of any member who retires without repaying the full amount so borrowed,

the Division of Pensions and Benefits shall deduct from the retirement allowance payments

the same monthly amount which was deducted from the salary of the member immediately

preceding retirement until the balance of the amount borrowed together with the interest is repaid. In the case of a retirant who dies before the outstanding balance of the loan and

interest thereon has been recovered, the remaining balance shall be repaid from the

proceeds of any other benefits payable on the account of the retirant either in the

form of monthly payments due to the retirant's beneficiaries or in the form of lump

sum payments payable for pension or group life insurance.