The federal government mandates that students who withdraw from all classes may only keep the federal financial aid (i.e., Title IV funds) they have "earned" up to the time of withdrawal. Title IV funds that have been disbursed in excess of the earned amount must be returned by the college and/or the student to the federal government. Thus, the student could owe aid funds to the college, the federal government, or both.
The Financial Aid Office is notified when a student has officially withdrawn from the college. The calculation for Return of Title IV funds is based upon the date on which a student initiates the withdrawal process by indicating intent to withdraw.
To determine the amount of aid the student has earned up to the time of withdrawal, the Financial Aid Office divides the number of calendar days the student has attended classes by the total number of calendar days in the semester (minus any scheduled breaks of 5 days or more). The resulting percentage is then multiplied by the total federal funds that were disbursed to the student account for the semester.
This calculation determines the amount of aid earned by the student that he or she may keep. For example, if the student attended 25% of the term, the student will have earned 25% of the aid. The unearned amount (total aid disbursed minus the earned amount) must be returned to the Department of Education by the college and/or the student. The Financial Aid Office will notify and provide instructions to students who are required to return funds to the Department of Education.
If you are considering withdrawing from classes, remember to contact the Financial Aid office before you do so. Meeting with a financial aid officer will help you understand how withdrawing will affect your situation.
Funds are returned to the following Title IV source in this order:
Unsubsidized Federal Direct Loans
Subsidized Federal Direct Loans
Federal Perkins Loans
Federal Direct Graduate PLUS loans
Federal Direct PLUS (parent) loans
Federal Pell Grants