Return of Title IV Funds

Return of Title IV Funds

The Higher Education Amendments of 1998 changed the formula for calculating how much financial aid you can retain when withdrawing from all classes. Title IV Funds include Federal Pell Grants and Federal Supplemental Educational Opportunity Grants (FSEOG).

 

If you withdraw from all classes prior to completing 60 percent of the semester, you will have your eligibility for financial aid recalculated using the percentage of the semester you completed.

 

Example:

 A student withdraws from all classes after completing only 30 percent of the semester.

The student is considered to have "earned" only 30 percent of the Title IV funds awarded.

The remaining 70 percent of funds awarded must be returned by the school and/or the student.

 

The Withdrawal Process

To officially begin the withdrawal process, notify the Admissions and Records Office of your intent. You will be given an official withdrawal form to complete, sign and date. The Financial Aid Office will use the date you sign the form as the official withdrawal date. Withdrawal dates may also be established when an instructor completes an Instructor Withdrawal Form.

The Financial Aid Office must determine if you were a recipient of Title IV funds who withdrew prior to the 60 percent point and perform the Return of Title IV Funds calculation. If it is determined that you received an overpayment, the Financial Aid Office is required to send written notification to you with the amount owed and the Title IV program to repay. This notification must be sent to you no later than 30 calendar days after the Financial Aid Office is notified of your withdrawal.

 

The Repayment Process

If you received an overpayment, you have 45 days to contact the Financial Aid Office and take action. On the 46th day, if you have taken no action to make repayment, your overpayment will be referred to the Department of Education for collections and the overpayment will be reported to the National Student Loan Data System (NSLDS). A referral to NSLDS will end your eligibility for Title IV funds.

 

Students who take repayment action within the 45-day period are eligible to extend their Title IV eligibility by repaying the overpayment in full to the school or by signing a repayment agreement with the Mitchell Business Office. If you go into repayment, you have three months to repay the overpayment. You will be required to repay 10 percent of the total overpayment in each payment for the first two months with the balance to be paid in full by the third month. Any time you fail to meet the terms of the repayment agreement, your overpayment will be referred to the Department of Education for collections and immediately reported to NSLDS. A referral to NSLDS will end your eligibility for Title IV funds.

 

If the Return of Title IV Funds calculation is performed and it determines you received less Title IV funds than the amount earned, Mitchell must make a post-withdrawal disbursement to you of the earned aid that was not received. In order to make a post-withdrawal disbursement for incurred educational costs, the school must have received your valid Student Aid Report (SAR) or Institutional Student Information Record (ISIR) with an official Expected Family Contribution (EFC). To be eligible for a post-withdrawal disbursement, you must meet all Federal Guidelines outlined by the Department of Education.