Return of Title IV Funds
A recipient of federal Title IV financial aid who withdraws or is dismissed from school during a payment period or period of enrollment in which the student began attendance will have the amount of Title IV funds they did not earn calculated according to federal regulations. This calculation will be based on the student’s last date of attendance and the date the school determines that the student has withdrawn from school (see withdrawal policy), or the date of dismissal for a student who is dismissed by the institution.
Schools are required to determine Title IV funds that must be refunded based upon the percentage of the payment period completed prior to withdrawing. Title IV funds must be returned to the program based upon a tuition refund or if the student received an overpayment based upon costs not incurred but for which Title IV was received.
Once the amount of Title IV financial aid that was not earned has been calculated, federal regulations require that the school return Title IV funds disbursed for the payment period or period of enrollment and used for institutional costs in the following order:
- Loans
- Unsubsidized Federal Direct Stafford Loans
- Subsidized Federal Direct Stafford Loans
- Federal Perkins Loans
- Federal Direct PLUS loans received on behalf of the student.
- Federal Pell Grants.
- ACG
- National SMART
- Federal SEOG
- Other grant or loan assistance authorized by Title IV of the HEA.
If the amount of unearned Title IV financial aid disbursed exceeds the amount that is returned by the school, then the student (or parent, if a Federal Parent-PLUS Loan) must return or repay, as appropriate, the remaining grant and loan funds. The student (or parent, if a Federal Parent-PLUS Loan) will be notified of the amount that must be returned or paid back, as appropriate.