Federal Title IV regulations (34CFR 668.22) require repayment of a portion of funds received by students unless certain conditions are met. A student who withdraws from or stops attending all courses before completing at least 60% of an enrollment period (i.e., a semester/term) must repay the unearned portion of the funds received. This rule applies to all federal grant and loan funds received as a disbursement by a student. 

The funds that are required to be returned on behalf of the student will be returned within 45 days of the withdrawal date.  The funds will be returned in this order:

  1. Unsubsidized Federal Stafford Loan
  2. Subsidized Federal Stafford Loan
  3. Federal PLUS Loan
  4. Federal Pell Grant
  5. Federal Supplemental Educational Opportunity Grant

Once a student has completed more than 60% of the term, the student will not incur repayment of financial aid funds; however, future financial aid could be affected due to not meeting Satisfactory Academic Progress.

There are also financial consequences for Bright Futures Scholarship recipients who receive a grade of “W” or “WF”.

AmountType of Aid
$2,969.00Federal Direct Unsubsidized Loan
$2,227.00Federal Direct Subsidized Loan
$0.00Pell Grant
$5,196.00Total Aid Received

The student attended 28 days of the 111 days in the period, or 25.2%.  The student earned 25.2% of the aid.  Leaving 74.8% of unearned aid, of the total aid, the student is required to return $3,886.  The student has institutional charges of $2,490.77. 

Institutional aid is calculated first, ($2,490.77 * .748 = $1863).  The unearned aid must be returned based on the order or return.  All of the unearned funds will be returned from the Federal Unsubsidized Loan.

The remaining unearned funds the student is required to return.  The student is required to return $1106 in Unsubsidized Loan and $918 in Subsidized Loan.  The student must repay the loan based on the repayment schedule maintained by the lender.

In order to receive financial aid, students must attend the courses for which they are registered at least once during the first two weeks of any semester. Students enrolled in fully online courses must participate in an academically related activity (submit an assignment, or participate in the course discussion board) to satisfy initial attendance verification (PRO 3-05). If marked as not attending during this period, the student will be financially responsible for the course, and Financial Aid and Veteran benefits may be decreased. Students who are reported as not attending will remain in the class. 

A post-withdrawal disbursement might be required if the student did not receive all the funds they earned before withdrawing.  LSSC will automatically apply earned grant funds to the balance owed on their student account.  If the post-withdrawal disbursement includes loan funds, the student will be notified in writing with the amount of the potential disbursement.  They have 14 days to respond in writing if they choose to have the disbursement applied to their account.  If no response is received, the loan will be canceled.

If the post-withdrawal disbursement results in a credit balance on the student account, a refund will be sent via the refund method selected by the student.

For grants, the law requires the student to return 50% of any grant funds they receive. Any amount the student is required to return is a grant overpayment. LSSC will notify a student if a grant overpayment is required.  They will have 30 days to pay the overpayment to LSSC.  If the overpayment is not paid in that 30 days, we will refer the overpayment to the Department of Education’s Debt Resolution Services.  The student will have to resolve the overpayment with the Department of Education before they can receive Title IV aid again. 

Once the Return to Title IV Funds calculation has occurred, the Financial Aid Office will notify the student of the calculation results, the returned aid, and the student account status.

Students that do not successfully complete any classes with a passing grade will be monitored at the end of each term for unofficial withdrawals. If it is determined that the punitive grades resulted from an unofficial withdrawal, the Return of Unearned Title IV Funds calculation will be applied to awards received. The student will be required to repay grant and loan funds as appropriate.