* § 696-a. Loans. 1. a. Notwithstanding the provisions of any\ngeneral, special or local law, an agency is hereby authorized to make or\ncontract to make grants or loans to the owner of any property that is\npart of an urban development action area project for the purpose of (i)\nrehabilitation of an existing private or multiple dwelling or\nconstruction of a new private or multiple dwelling, (ii) providing site\nimprovements, incidental or appurtenant to such rehabilitation or such\nconstruction, within the urban development action area in which the\nurban development action area project is located, including, but not\nlimited to, water and sewer facilities, sidewalks, landscaping, parks\nand open space, social, recreational, communal and other non-residential\nfacilities and the outfitting thereof, the curing of problems caused by\nabnormal site conditions, excavation and construction of footings and\nfoundations and other improvements associated with the provision of\ninfrastructure, or (iii) providing for other costs of construction for\nthe development of private and multiple dwelling housing accommodations.\n b. In the case of a grant made under this section for the\nrehabilitation of an existing multiple dwelling intended to be converted\nto a condominium or cooperative form of ownership or for the development\nof one to four unit housing accommodations or a condominium or\ncooperative housing corporation, such grant shall require a regulatory\nagreement with the agency limiting profits.\n c. Any loan made in accordance with this section shall be secured by a\nnote and mortgage upon the property improved, other than any such\nproperty title to which is held by the municipality or, in the case of a\ncondominium, a note and mortgage upon each of the condominium units\naided by such loan, or in the case of a cooperative housing corporation,\na note and mortgage upon the economic interest in such corporation of\neach tenant-shareholder aided by such loan, or upon the property\nimproved, other than any such property title to which is held by the\nmunicipality, or upon both such economic interest or property; provided,\nhowever, that all or part of any such loan may be unsecured if necessary\nto satisfy the requirements of any participating lender, and, provided\nfurther, that the lien created by the note and mortgage may be recorded\nin an equal or subordinate position, or subsequently made equal or\nsubordinate, to a lien recorded by any participating lender against such\nproperty. Such loan shall be repaid over such period as the agency shall\ndetermine.\n d. Such note and mortgage may provide that the loan shall\nautomatically be reduced to zero over a period of up to thirty years of\ncontinuous compliance by the owner with a regulatory agreement with the\nagency limiting profits and rentals charged or requiring owner\noccupancy. Notwithstanding such provision as contained in the note and\nmortgage, the loan shall be reduced to zero only if, prior to or\nsimultaneously with delivery of such note and mortgage, the agency made\na written determination that such reduction would be necessary to ensure\nthe continued affordability or economic viability of the housing\naccommodations assisted by such loan. Such written determination shall\ndocument the basis upon which the loan was determined to be eligible for\nevaporation.\n e. In the case of a grant or loan made under this section for the\npurpose of providing rental housing for persons of low income as defined\nin section two of the private housing finance law, such loan or grant\nshall require a regulatory agreement with the agency limiting profits\nand rentals charged.\n f. The repayment of any loan made in accordance with this section\nshall be made in such manner as may be provided in such note and\nmortgage in connection with such loan, and may authorize the owner, with\nthe consent of the agency, to prepay the principal of the loan subject\nto such terms and co
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