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General Description
Requirements
Policy Provisions
Performance Evaluation
Subject Experts
Return of Federal Financial Assistance
Policy

Document Number: SFS--114 Revision #: 1.0
Document Owner: Date Last Updated: 11/03/2015
Primary Author: Executive Director of Enrollment Services Status: Approved
Date Originally Created: 11/30/2011

General Description
Description:

Information about return of federal financial assistance.


Purpose:

Delineation of policy.


Scope:

Students


Responsibility: Student Financial Services
VP of Business and Finance

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Requirements
Relevant Knowledge: In order to comply with this policy you should know:
Federal statutes
Current University policy

Terms and Definitions: Additional training

Corrective Action

Loss of privilege, general

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Policy Provisions
1.

Return of Title IV Funds (R2T4) Policy

 


When a student who has received Federal financial assistance (Pell Grants, FSEOG Grants, Federal Perkins Loans, Federal Direct Stafford Loans, or Federal Direct Parent Loans for Undergraduates) fully withdraws from the University, the unearned portion of the aid must be returned to the program. The unearned portion is calculated up to the first 60% of the enrollment period. The calculations are made on a pro-rata basis, based upon the total enrollment period. The withdrawal date used in the return calculation of a student’s federal financial aid is the actual date indicated on the official drop form as provided by the University Registrar’s Office.

Institutions are required to determine the percentage of Title IV aid ‘’earned” by the student and to return the unearned portion to the appropriate aid programs. Regulations require schools to perform calculations within 30 days from the date the school determines a student’s complete withdrawal. The school must return the funds within 45 days of the calculation. The R2T4 calculation process and return of funds is completed by the Student Financial Services Office (SFS).

The Federal government has set the order in which unearned aid must be returned to the programs. Students should note that the requirement to return the unearned portion of Federal financial assistance might leave them owing a balance due to Cumberland University.

The order of distribution for refunds is as follows:

· William D. Ford Direct Unsubsidized Federal Stafford Loans

· William D. Ford Direct Subsidized Federal Stafford Loans

· William D. Ford Federal Direct PLUS Loans

· Federal Pell Grants

· Federal Supplemental Educational Opportunity Grants (FSEOG)

· Other Title IV aid

· Other Federal sources

· State, private or institutional aid

· Student

 


2.

Return of Title IV Funds (R2T4) process

 


The Student Financial Services (SFS) Office will determine the following:

· The total amount of Title IV aid disbursed for the semester in which the student withdrew. A student’s Title IV aid is counted as aid disbursed in the calculation if it has been applied to the student’s account on or before the date the student withdrew.

· The total amount of Title IV aid disbursed plus the Title IV aid that could have been disbursed for the semester in which the student withdrew.

 

The percentage of Title IV aid earned will be calculated using the number of calendar days completed by the student divided by the total number of calendar days in the semester in which the student withdrew. The total number of calendar days in a semester shall exclude any scheduled breaks of more than five days. If the calculated percentage completed exceeds 60%, then the student has “earned” all the Title IV aid for the enrollment period.

 

The SFS office determines the percentage of Title IV aid earned by the student using software provided by the Department of Education for that specific purpose and will determine the necessary course of action based on the calculation results. (See below)

· If the aid already disbursed equals the earned aid, no further action is required.

· If the aid already disbursed is greater than the earned aid, the difference must be returned to the appropriate Title IV aid program.

· If the aid already disbursed is less than the earned aid, then the SFS office will calculate a post-withdrawal disbursement.

 

 


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Performance Evaluation
Performance Metrics: Compliance with standard policy and procedure
Compliance with federal mandate

Consequences: Further training
Loss of privileges

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Subject Experts
The following may be consulted for additional information.
Executive Director of Enrollment Services

Legal Counsel

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