Return of Federal Title IV Funds

Effective Fall of 2000, the 1992 reauthorization of Higher Education Act of 1965 imposed a federally mandated refund policy on colleges and universities for students who receive Title IV financial aid. Institutions were required to use various refund calculations to determine the amount that the institution earned while the student was in attendance. The calculations varied according to the student’s status, first-time student or continuing student. There was considerable confusion in the financial aid community with regard to the amount that the institution would be eligible to retain and that a student would be required to “repay” if he or she withdrew from a semester. The 1998 reauthorization of the Higher Education Act of 1964 simplified this calculation by replacing the current calculations with a single pro rata formula. It also shifted the focus from institution to the student. The student is only eligible for the amount that is earned at the time he or she ceases attendance. It no longer has a relationship to the student’s institutional charges.

EFFECTIVE FOR PERIODS OF ENROLLMENT BEGINNING ON OR AFTER 8/28/2000

The policy shall apply to all students who withdraw, drop out or are expelled from CALDWELL COLLEGE and receive financial aid from Title IV funds:

  1. The term “Title IV Funds” refers to the Federal financial aid programs authorized under the Higher Education Act of 1965 (as amended ) and includes the following programs: Parent/Graduate PLUS loan, unsubsidized Stafford loans, subsidized Stafford loans, Federal SEOG grant and Federal Pell grant.
    1. A student’s withdrawal date is:
      a.i. The date the student began the institution’s withdrawal process or officially notified the institution of intent to withdraw; or
      a.ii. The midpoint of the period for a student who leaves unofficially without notifying the institution; or
      a.iii. The student’s last date of attendance at a documented academically related activity.
  2. Refunds on all institutional charges, including tuition and fees, will be calculated using the Caldwell University refund policy published in the Catalog and Class Schedule and will be calculated and determined by Student Accounts.
  3. Title IV aid is earned in a prorated manner on a per diem basis up to and including the 60% point in the semester. 60% is approximately 9.6 weeks of a 16-week semester or 4.8 weeks of an 8-week summer session. Title IV aid and all other aid is viewed as 100% earned after that point in time.
    1. The percentage of Title IV aid earned shall be calculated as follows: Number of days completed by student ÷ Total number of days in term* = Percent of term completed the percent of term completed shall be the percentage of Title IV aid earned by the student.
      a.i. *The total number of calendar days in a term of enrollment shall exclude any scheduled breaks of more than five days
    2. The percentage of Title IV aid unearned (i/e., to be returned to the appropriate aid program) shall be 100% minus the percent earned.
    3.  Unearned aid shall be returned first from the student’s account calculated as follows: Total institutional charges (x) percent of unearned aid = amount returned to programs Unearned Title IV aid shall be returned to the following programs in the following order:
      c.i. Graduate/Parent Federal PLUS loan
      c.ii. Unsubsidized Federal Stafford Loan
      c.iii. Subsidized Federal Stafford Loan
      c.iv. Federal SEOG Grant
      c.v. Federal Pell Grant
      c.vi. Other Title IV grant programs

      Exception: no program can receive a refund if the student did not receive aid from that program.
       

    4. When the total amount of unearned aid is greater than the amount returned from the student’s account, the student is responsible for returning unearned aid to the appropriate programs(s) as follows:

      d.i. Graduate/Parent Federal PLUS loan
      d.ii. Unsubsidized Federal Stafford Loan*
      d.iii. Subsidized Federal Stafford Loan*
      d.iv. Federal Pell Grant**
      d.v. Federal SEOG Grant**
      d.vi. Other Title IV grant programs**

*Loan amounts are returned in accordance with the terms of the promissory note signed by the student.
**Amounts to be returned by the student to federal grant programs will receive a 50% discount.

RETURN OF TITLE IV FUNDS POLICY

The following procedures should be followed when the Office of Financial aid receives notification that a student, who is receiving financial aid, has withdrawn from the College.

  • Official Withdrawal: Caldwell University will apply the official withdrawal date as recorded by the Registrar Office in determining the return of funds due by the student and/or institution. Caldwell University will consider the student’s official withdrawal date to be the date the student submits his/her written withdrawal request, to the Registrar.

  • Unofficial withdrawal: Caldwell University will contact the student’s instructors to verify that the student attended “at least half-time.” If the instructor/s cannot verify the student’s attendance “at least half-time”, the student must return all financial aid funds. If the instructor/s verify the student did attend “at least half-time,” the Financial Aid Office will apply the 50% point of the semester to be the withdrawal date. If Caldwell University determines that a student did not begin the institution’s withdrawal process or otherwise provide official notification (including notice from an individual acting on the student’s behalf) to Caldwell University of his/her intent to withdraw because of illness, accident, grievous personal loss, or other such circumstances beyond the student’s control, Caldwell University may assign a withdrawal date that is related to that circumstance.

Calculations: Caldwell University will use the Return of Title IV Federal software program to determine the amount the student and /or institution must refund to the appropriate program. The Financial Aid Office and Bursars office will work cooperatively to verify the accuracy of each refund calculation.

  1. Institution’s return of funds: Once the institution’s portion of the return of funds has been calculated, the Financial Aid Office will reduce the student’s original financial award and return the funds within 30 days to the appropriate program/s in the order specified. If this creates a “charge” on the student’s account in the Student Accounts Office, the student will be responsible for paying the debt to Student Accounts immediately. The student will not be allowed to register, receive an official transcript, and/or receive future financial aid until the debt to Caldwell University has been paid in full.
  2. Student’s return of funds: Once the student’s portion of the return of funds has been calculated, the Financial Aid Office will notify the student of the amount he/she must repay. The student may select one of the following repayment options:
    b.i. The student may pay Caldwell University the full amount of his/her debt, and the College will return the funds to the appropriate programs or
    b.ii. The student may contact the Department of Education to establish a repayment plan.

The student will remain eligible for Title IV funds for 45 days from the date the institution sends a notice to the student of the overpayment. To continue eligibility past 45 days, the student must pay the overpayment in full to Caldwell University or make satisfactory arrangements to repay with the Department of Education. On the 46th day, the institution will report the student’s overpayment to the Department of Education, and if the student must return federal loan funds, the student’s lender will be notified of the amount owed by the student. The student is responsible for repayment of any loan debt to his/her lender.

  • Return of Unearned Funds: Unearned funds must be returned in the following order: Graduate/Parent Federal PLUS loan, Unsubsidized Federal Stafford Loan, Subsidized Federal Stafford loan, Federal Pell Grant, Federal SEOG, and other grant, scholarship, or loan assistance. If there is a return for a loan fund, that was originally received by EFT, the Financial Aid Office will be responsible for the return of these funds. If the loan funds were originally received by “paper check” from the lender, Student Accounts will be responsible for return of these funds to the lender.

  • Post-Withdrawal Funds: If the amount disbursed to the student is less than the amount the student earned, the amount is considered to be post-withdrawal disbursement. Post-withdrawal eligibility can be used to credit outstanding charges on the student’s tuition account. Caldwell University has 30days, from the date of the institution’s determination that the student withdrew, to offer any amount of the post-withdrawal disbursement to the student, (or parent for PLUS loans). The student (or parent) may accept or decline some or all of the post-withdrawal disbursement that is not credited to the student’s account. The student or parent must respond within 14 days of the date that the institution sends the notification to be eligible to receive the post-withdrawal disbursement. If the post-withdrawal disbursement is accepted, Caldwell University must make payment within 90 days of the date of the institution’s determination that the student withdrew. If the student (or parent) does not respond to the institution’s notice, no portion of the post-withdrawal disbursement that is not credited to the student’s account may be disbursed.


RSS RSS