N.J. Stat. § 18A:71C-6
Whenever any approved note, including notes held by the authority in the Higher Education Student Assistance Fund, or any installment thereon, shall be in default as defined under 20 U.S.C.s. 1071 et seq., upon the death or total and permanent disability of the borrower, or upon any other reason for payment of a claim permitted under 20 U.S.C.s. 1071 et seq., the authority shall, upon the demand of a lender and subject to a lender's meeting federal and authority due diligence requirements, purchase the note by paying to the lender or by transferring to the Higher Education Student Assistance Fund out of the Loan Reserve Fund, the amount of principal, interest and other permissible charges then due and owing on the note, as herein provided.
N.J.S. § 18A:71C-6