Return of Federal Title IV Funds
The Higher Education Amendments of 1998 (HEA98) represent a major shift in the return of Title IV Federal Financial Aid when a student withdraws from the university. The policy governs all federal grant and loan programs (Pell, SEOG, Stafford Loans, Perkins and PLUS loans), but does not include the Federal Work-Study program.
In general, the law assumes that a student “earns” approved (verified) federal financial aid awards in proportion to the number of days in the term prior to the student’s complete withdrawal. If a student completely withdraws from school during a term, the school must calculate, according to a specific formula, the portion of the total scheduled financial assistance that the student has earned and is therefore entitled to retain, until the time that the student withdrew. If a student receives (or the university receives on the student’s behalf) more assistance than he/she earns, the unearned funds must be returned to the Department of Education or to the Federal Stafford or parent’s Federal PLUS loan lenders. If a student’s charges are less than the amount earned, and a refund is due, the student may be able to receive those additional funds. Students who have not completed the verification process are ineligible to receive any financial aid.
The portion of the federal grants and loans that the student is entitled to receive is calculated on a percentage basis by comparing the total number of days in the semester to the number of days that the student completed before he/she withdrew. The policy governs the earned and unearned portions of the student’s Federal Title IV Financial Aid only. It determines how much, if any, the student and/or the school may need to return. This policy does not affect the student’s charges. The university’s withdrawal policy will be used to determine the reduction, if any, in the student’s tuition and fee or room and board charges. The student is responsible for paying any outstanding
charges to the university.
If it is determined that funds must be returned to Title IV programs, funds will be returned in the following order: Unsubsidized Loan, Subsidized Loan, Perkins Loan, PLUS Loan, Pell Grant, ACG Grant, SMART Grant and FSEOG Grant.
The student’s official withdrawal date will be determined by the university as:
- the date the student began the university’s withdrawal process.
- the midpoint of the semester if the student withdraws without notifying the university.
- the student’s last day of attendance at an academically-related activity as documented by the university.
Federal Policy Regarding "Unofficial Withdrawals"
The Federal Regulations GEN 0403 provides guidance on the application of Return to Title IV aid requirements. This guidance requires institutions to closely monitor the attendance of students who receive Title IV aid.
At the end of every semester, grade evaluations are completed to determine compliance with this regulation. The Federal government assumes that students who do not receive a passing grade in any class attempted and/or receive incomplete grades have unofficially withdrawn from the institution. This assumption requires Texas A&M University-Kingsville to formally document the attendance of students who receive all “F’s” or “I’s” in classes attempted in that period.
If a student earns a passing grade in at least one course, the Return to Title IV policy is not applicable.
** Please note that information in the preceding section on Financial Aid is subject to change. For current information, please refer to the Financial Aid Webpage.