(a) These rules and regulations are being promulgated by the New York State Affordable Housing Corporation (the “corporation”) pursuant to section 1113(1) of the Private Housing Finance Law. The corporation, a subsidiary of the New York State Housing Finance Agency, was created to operate the Affordable Home Ownership Development Program (Private Housing Finance Law, § 1110 et seq., hereinafter the “act”).

(b) The purpose of the program is to promote home ownership by persons of low and moderate income, which, in turn, promotes development, stabilization and preservation of neighborhoods and communities. To achieve these goals, the corporation will provide financial assistance, in conjunction with other private and public investment, for the acquisition, construction, rehabilitation and improvement of owner-occupied housing. By reducing development and rehabilitation costs, assistance provided under the act is expected to make home ownership affordable to families and individuals for whom there are no other reasonable and affordable home ownership alternatives in the private market. Additionally, the development and rehabilitation activities undertaken in connection with this program are expected to help eliminate conditions of slums and blight and to create jobs and stability in communities throughout the State.

(c) The financial assistance provided by the corporation will be in the form of grants. The grantees may make these funds available to recipients in the form of payments, grants and loans. Such loans may, but need not, be in the form of participation in loans originated or financed by lending institutions as defined under section 42 of the Private Housing Finance Law, employee pension funds, or the State of New York Mortgage Agency. The grantees shall determine the terms and conditions for such payments, grants or loans.