Return of Title IV Funds

The Federal Government has established a Return of Title IV Funds policy that specifies the amount of Title IV funds that a student earns if they withdraw from school. The Title IV funds that are covered by this policy are Federal Direct Loans, Direct PLUS Loans, Pell Grants, and Supplemental Education Opportunity Grants (SEOG).

Financial aid is awarded to students contingent upon actively participating in their classes and successfully completing the semester. If the student fails to do this, they may be responsible for repaying part or all of their financial aid based on their official or unofficial withdrawal date.

EICC will return the prorated amount of Title IV funds to the appropriate federal programs for students who withdraw before completing 60% of their scheduled classes for the semester, as required by CFR Section 668.22.

Official and Unofficial Withdrawals

Students should review EICC’s Course Withdrawal Policy before withdrawing from their classes. A student is considered to have withdrawn if they do not complete all of the days they were scheduled to complete within the semester. The determination of a withdrawal depends upon the original dates they enrolled in for the semester. 

There are two types of withdrawals: official withdrawals or unofficial withdrawals

Official Withdrawal

A student is considered to have officially withdrawn when they follow the college’s defined process to withdraw from classes. A complete withdrawal is defined as dropping all classes for a given semester. A student’s official withdrawal date is defined as:

  • The date the student signs and turns into the registration office a drop card OR
  • The date the registration office receives a written letter, fax, or email from the student requesting to be withdrawn from all classes OR
  • The date a student phones the registration office requesting to be withdrawn from all classes OR
  • The date the student withdraws from all classes on Self-Service

A student’s official withdrawal date is defined as the day that they began the process to withdraw from classes.

Unofficial Withdrawal

A student is considered to have unofficially withdrawn when:

  1. The student does not complete the official withdrawal process AND
  2. All of the student’s instructors report that the student is no longer attending classes. 

A student’s unofficial withdrawal date is defined as: The midpoint (50%) of the days the student was scheduled to attend, unless the Financial Aid Office is able to document attendance beyond the midpoint. The time frame for midpoint may differ for students because it is based on the days they were scheduled to attend.

An unofficial withdrawal will result in all F’s being recorded on the student’s academic transcript.

Exemptions to the Return of Title IV Funds

A student is not subject to returns of their Title IV funds if they meet one of the following exemptions:

  • They complete all of the requirements for graduation for their program of study;
  • They successfully complete a class or multiple classes that comprise at least 49% of the days in the semester; or
  • They successfully complete a class or multiple classes that comprise at least half-time enrollment for a program.

Consequences for Withdrawal and Financial Aid

A student who officially withdraws earns aid based on the number of calendar days they attended. Earned aid is calculated from the date that the student began attending classes until the official withdrawal date. (Scheduled breaks that are at least five days long are excluded from determining the percentage of the semester completed.) After the student has completed 60% of the days they were scheduled to attend, all aid is considered earned.

The Return of Title IV Funds calculation will be performed according to federal regulations by taking the “Nth” calendar day of the semester that the student officially withdraws divided by the total number of calendar days the student was scheduled to attend during in the semester (excluding scheduled breaks of 5 days or longer).

The time frame for the 60% point of the semester may differ for students because it is based on the days they were scheduled to attend.

For unofficial withdrawals the Return of Title IV Funds calculation will be performed according to federal regulations by using the mid-point (50% point) of the days the student was scheduled to attend unless the Financial Aid Office is able to document attendance beyond the midpoint of the semester (excluding breaks of 5 days or longer).

Examples of How Much Aid is Earned and How Much is Returned

The following are hypothetical examples of the Return of Title IV funds calculation. Each student’s calculation will be determined by their class schedule and the amount of financial aid they received.

Example 1

A student was scheduled to attend a 16-week class that started on August 27 and ended on December 15, which means the student was scheduled to attend 111 days. The student officially withdrew from the class on September 30, which means the student attended 35 days before they withdrew.

35 days attended / 111 days scheduled to attend = 0.315 or 31.5%

This means the student completed 31.5% of the days they were scheduled to attend, therefore the student earned 31.5% of the financial aid they received.

If the student received $1,000.00 Pell Grant and earned 31.5% of that amount, then they will get to keep $315.00 Pell grant, and $683.00 Pell Grant will need to be returned to the Department of Education.

1,000 x 0.315 (or 31.5%) = 315.00

$1,000 received – $315 retained by student = $685 returned to the Department of ED

Example 2

A student was scheduled to attend a 1st 8-week class that started on August 27 and ended on October 20, which means the student was scheduled to attend 55 days. The student officially withdrew from the class on September 30, which means the student attended 35 days before they withdrew.

35 days attended / 55 days scheduled to attend = 0.636 or 63.6%

This means the student completed 63.6% of the days they were scheduled to attend.

Since the student completed more than 60% of the days they were scheduled to attend, all of their financial aid is considered earned aid. This means the student will be able to keep all the financial aid they received and will not need to return any aid to the Department of Education.

Procedure for Repaying the Department of Education

If it is determined through the Return of Title IV Funds calculation that the student owes a repayment of funds to the Department of Education, EICC will return the funds to the Department on the student’s behalf. This will create a balance due on the student’s account at EICC.

If the student owes a balance on their account at EICC due to this calculation, they must pay their balance due before future registration. The student must contact the Business Office within 45 days of receiving written notification of their repayment obligation. If they do not contact the Business Office, they could be turned over to the Department of Education for collection.

In rare cases, the student may owe a repayment of grant funds to the Department of Education in addition to the funds returned by EICC on the student’s behalf. If this happens, the student will remain ineligible for federal and state aid until EICC receives notification from the Department of Education that the student has resolved their repayment.

Procedure for Repaying the State of Iowa

If a student receives a state funded grant and withdraws before the end of a term, they may be subject to a return of state funds. The amount of state aid to be returned will be calculated based on EICC’s tuition refund policy.