Return of Funds Policy
Federal Title IV Return of Funds Policy
- Federal law now specifies how a school must determine the amount of federal financial aid* that a student earns if s/he withdraws, drops out, is dismissed, or takes a leave of absence prior to completing more than 60% of a payment period.
- The amount of federal financial aid assistance that the student earns is determined on a pro-rata basis. Once the student has completed more than 60% of the payment period, all financial aid assistance is considered to be earned.
- Percent earned = Number of calendar days completed up to the withdrawal date** divided by total calendar days in the payment period—excluding any scheduled breaks that are at least 5 days long.
- Percent unearned = 100% minus percent earned
- The school returns the lesser of:
- Institutional charges (tuition and fees)*** multiplied by the unearned percentage, or
- Title IV federal financial aid disbursed multiplied by the unearned percentage
- The student returns:
- Any remaining unearned aid from the funds that s/he received as financial aid disbursements
- Any loan funds are repaid in accordance with the terms of the promissory note. That is, scheduled payments to the holder of the loan over a period of time.
- Any grant amount the student has to return is a grant overpayment, and arrangements must be made with the school or Department of Education to return the funds.
*Federal financial aid includes the federal Pell Grant, federal Supplemental Opportunity Grant (SEOG), federal Stafford Loans (subsidized and unsubsidized), federal PLUS loans for parents and Talent Incentive Program (TIP) grants.
**Withdrawal date is defined as the actual date the student begins the institution’s withdrawal process, the student’s last date of academically related activity, or the midpoint of the payment period for a student who leaves without notifying the institution.
***Book charges may not be included in institutional costs; however, a student remains financially responsible for any charges made by him/her in the College Bookstore.