New Jersey § 55:14k-10

§ 55:14k-10.

a. In any foreclosure action involving a housing sponsor other than a foreclosure

action instituted by the agency, the agency and the municipality in which any tax

exemption or abatement is provided to the housing sponsor shall, in addition to other

necessary parties, be made parties defendant. The agency and the municipality shall take all steps in the action necessary to

protect the interest of the public therein, and no costs shall be awarded against

the agency or the municipality. b. Subject to the terms of any applicable loan agreement, contract or other instrument

entered into or obtained pursuant to subsection a. of section 7 of this act, 1 judgment of foreclosure in accordance with this section shall not be entered unless

the court to which application therefor is made shall be satisfied that the interest

of the lienholder or holders cannot be adequately secured or safeguarded except by

the sale of the property; and in the proceeding the court shall be authorized to

make an order increasing the rental or carrying charges to be charged for the housing

accommodations in the housing project involved in the foreclosure, or appoint a member

of the agency or any officer of the municipality in which any tax exemption or abatement

with respect to the project is provided, as a receiver of the property, or grant such

other and further relief as may be reasonable and proper; and in the event of a foreclosure

or other judicial sale, the property shall be sold only to a housing sponsor which

will manage, operate and maintain the project subject to the provisions of this act,

unless the court finds that the interest and principal on the obligations secured

by the lien which is the subject of foreclosure cannot be earned under the limitations

imposed by the provisions of this act and that the proceeding was brought in good

faith, in which event the property may be sold free of limitations imposed by this

act or subject to such limitations as the court may deem advisable to protect the

public interest. c. In the event of a judgment against any housing sponsor in any action not pertaining

to the foreclosure of a mortgage, there shall be no sale of any of the real property

included in any housing project hereunder of the housing sponsor except upon 120 days'

written notice to the agency. Upon receipt of the notice the agency shall take those steps as in its judgment

may be necessary to protect the rights of all parties. 1

N.J.S.A. § 55:14K-7.