§ 1152. Affordable housing development loans. 1. (a) Notwithstanding\nthe provisions of any general, special or local law, one or more private\nlenders and the city of New York, acting through the agency, shall have\nthe power to participate and invest in making loans to sponsors for the\nconstruction of eligible projects. Such loans may be made exclusively\nfor or may include such amounts as may be required for site acquisition\nor the refinancing of eligible projects. Each such participation loan\nshall be secured by a bond or note and single participating mortgage or\nby separate bonds or notes and mortgages upon the eligible project. Such\nbond or note and mortgage or bonds or notes or mortgages may contain\nsuch other terms and provisions not inconsistent with the provisions of\nthis article as the agency may deem necessary or desirable, including,\nbut not limited to, terms providing that the lien created by such note\nand mortgage, and, if applicable, any regulatory agreement executed by\nthe sponsor and such agency or restrictive covenant approved by such\nagency, may be recorded in an equal or subordinate position, or\nsubsequently made equal or subordinate, to the lien created by any\nprivate lender against such eligible project.\n (b) Notwithstanding the provisions of any general, special or local\nlaw, and in addition to the power to make or contract to make\nparticipation loans granted by paragraph (a) of this subdivision, the\ncity of New York, acting through the agency, shall have the power to\nmake or contract to make loans or grants to any owner described in\nparagraph (a) of this subdivision without the participation of a private\nlender, on the same terms as permitted under such paragraph for a\nparticipation loan.\n 2. The agency may enter into an agreement with a private lender to\ndeposit its share of a loan with the private lender to be advanced by\nthe private lender. The portion of the loan funded by the agency may be\nequal to or subordinate in lien to the portion of the loan funded by the\nprivate lender and may contain such terms with respect to interest rate,\nif any, rate of amortization of principal, if any, and time of payment\nof interest and principal as determined by the agency. The agency may\nmake provision either in the mortgage or mortgages or by separate\nagreement for the performance by the private lender of such services as\nare generally performed by a banking institution which itself holds a\nmortgage, including, without limitation, construction loan advances,\nconstruction supervision, initiation of foreclosure proceedings,\nprocurement of insurance, and all other matters in connection with the\nfinancing, supervision, regulation and audit of any such loan to any\nsuch eligible project.\n 3. If the eligible project is to consist of one to four unit dwelling\naccommodations or cooperative or condominium units, the agency's share\nof the loan may be converted after completion of construction into\nmortgages on such dwelling accommodations or condominium units or\nfinancing statements filed with respect to such cooperative shares,\nprovided such units or such cooperative shares are purchased by persons\nof low income. Such mortgages and any blanket mortgage that the agency\nretains on any portion of, or on all of, the eligible project may\nprovide that such mortgages and such blanket mortgage will automatically\nbe reduced to zero over a period of continuous compliance by the\nmortgagor with a regulatory agreement or restrictive covenant with or\napproved by the agency and upon the satisfaction of any additional\nconditions specified therein. Notwithstanding such provision as\ncontained in such mortgage, the loan shall be reduced to zero only if,\nprior to or simultaneously with delivery of such mortgage, the agency\nmade a written determination that such reduction would be necessary to\nensure the continued affordability or economic viability of the eligible\nproject. Such written
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