Return of Title IV Funds

Return of Title IV Funds (R2T4)

This policy applies to students who officially withdraw, unofficially withdraw, or are dismissed from enrollment at SCSU. It is separate and distinct from the SCSU credit balance refund policy (see SCSU Refund Policy).

The calculated amount of the Return of Title IV (R2T4), funds that are required for the students affected by this policy are determined according to the following definitions and procedures as prescribed by regulations.

The amount of Title IV (federal) aid earned is based on the amount of time a student spent in academic attendance and the total aid received; it has no relationship to student’s incurred institutional charges. Because these requirements deal only with Title IV funds, the order of return of unearned funds do not include funds from sources other than the Title IV programs.

Title IV funds are awarded to the student under the assumption that he/she will attend school for the entire period for which the aid is awarded. When a student withdraws, he/she may no longer be eligible for the full amount of Title IV funds that were originally scheduled to be received. Therefore, the amount of federal funds earned must be determined. If the amount disbursed is greater than the amount earned, unearned funds must be returned.

The institution has 45 calendar days from the date that the institution determines that the student withdrew to return all unearned funds for which it is responsible. The school is required to notify the student if they owe a repayment via written notice.

Eligibility for post withdrawal disbursements will be confirmed within 30 calendar days of the date that the student withdrew. The school must advise the student or parent that they have 14 calendar days from the date that the school sent the post withdrawal disbursement notification to accept a post withdrawal disbursement. If a response is not received from the student or parent within the allowed time frame or the student declines the funds, the school will return any earned funds that the school is holding to the Title IV programs.

Official Withdrawal from St. Cloud State University

A student is considered to be officially withdrawn on:

1. The date the student provided official notification of intent to withdraw, in writing or verbally; or
2. The date the student completes the withdrawal process from SCSU in their Student eServices.

Official dates and deadlines for withdrawing are specified in the SCSU Academic Calendar.

A student may withdraw from SCSU at any time from the first-class day to the official last day to withdraw as indicated in the SCSU Academic Calendar. The official last day to withdraw is approximately 80 percent into the Fall or Spring terms or the equivalent dates for Summer sessions.

A student is considered a withdrawal from classes offered in a session of enrollment when the student ceases attendance at any point prior to completing the period of enrollment unless the school obtains confirmation from the student at the time of withdrawal that the student will attend a session that begins later in the same period of enrollment. This confirmation must be obtained at the time of the withdrawal even if the student has registered for subsequent courses.

If a student receives Title IV grant or loan assistance and does not begin attendance in a period of enrollment, the student is considered to be ineligible for any Title IV aid.

Upon receipt of the official withdrawal information, SCSU will complete the following:

1. The Business Office verifies the student’s attendance through the withdrawal form or the school’s attendance records;
2. The Return of Title IV (R2T4) calculation is performed to determine the amount of federal funds the student has earned and the amount of unearned Federal funds for which the school and the student is responsible to return (if any).
   1. The percentage of aid a student has earned is determined by dividing the number of completed calendar days by the number of calendar days in the semester; this includes weeks and holidays and excludes any schedules breaks longer than five days.
      1. Academic calendars are all standard terms. St. Cloud State University does not offer programs in non-standard terms or clock hour.
   2. Calculations are completed using the MinnState Return of Title IV application, student’s attendance and withdrawal date, and are based upon the period of enrollment.
3. The Business Office will return the amount of any unearned portion of the Title IV funds for which the school is responsible within 45 calendar days of the date the official notice of withdrawal was provided.
4. The Business Office will provide the student with a letter explaining any returns that have been made to the Title IV programs on the student’s behalf as a result of exiting the program.
   1. The initial amount of unearned Title IV aid due from the student (or parent, for Direct PLUS Loan funds) is determined by subtracting the amount returned by the school from the total amount of unearned Title IV funds to be returned. This is called the initial amount due from the student because a student does not have to immediately return loan funds or the full amount of any grant repayment due. Therefore, the student may not have to return the full initial amount due.
      1. The student loans that remain outstanding consist of the loans disbursed to the student minus any loans the school repaid. These outstanding loans are repaid by the student according to the terms of the student’s promissory note(s).
   2. The amount of grant overpayment due from a student is limited to the amount by which the original grant overpayment exceeds half (50%) of the total Title IV grant funds disbursed and could have been disbursed to the student.
      1. If the amount is less than $50.00, the student is not responsible for returning funds to Title IV grant programs.
5. If a student’s scheduled attendance is more than 60 percent of the period of enrollment, he/she is considered to have earned 100 percent of the federal funds received for the period of enrollment. In this case, no funds need to be returned and no letter will be sent from the Financial Aid Office.
6. If it is determined that a Post Withdrawal Disbursement (PWD) is needed, the following occurs:
   1. A PWD of grant funds must be disbursed within 45 days of the date of the school’s determination.
   2. If the student is eligible for a PWD of loan funds:
      1. SCSU must offer the loan funds to the student within 30 days of the date of the school’s determination that the student has withdrawn.
      2. SCSU must provide at least 14 days for the student to either accept or decline those loan funds.
      3. SCSU must disburse the requested loan funds no later than 180 days after the request has been made.
7. A copy of the completed worksheet and notification letter will be kept in the student’s file.

Officially withdrawing from classes may affect the student’s future eligibility for financial aid due to Satisfactory Academic Progress (SAP) requirements and R2T4 balances owed.

Unofficial Withdrawal from St. Cloud State University

Unofficial withdrawals encompass all other withdrawals where official notification is not provided to SCSU. If a student does not officially withdraw and subsequently fails to earn a passing grade in all courses attended over an entire period, the institution must assume, for Title IV purposes, the student has unofficially withdrawn, unless the institution can document that the student completed the enrollment period.

If a student receives Title IV grant or loan assistance and does not begin attendance in a period of enrollment, the student is considered to be ineligible for any Title IV aid.

When a recipient of Title IV grant or loan assistance unofficially withdraws from an institution, after having begun class attendance during a period of enrollment, the institution must determine the amount of Title IV grant or loan assistance that the student earned up to the date of withdrawal. For these unofficial withdrawals, the last date of an academically related activity in which the student participated as stated by the professor of record or authorized departmental representative, or the withdrawal date is the midpoint of the period of enrollment or the equivalent date for sessions of enrollment.

Once grades are final for a term, the following procedures will take place:

1. The Business Office will determine which students did not officially withdraw and failed to earn a passing grade in at least one course offered over an entire period.
2. The Business Office will determine and record the student’s last date of attendance as the withdrawal date.
   1. The withdrawal date is the midpoint of the period of enrollment or the equivalent date for sessions of enrollment, as applicable, or the last date of an academically related activity in which the student participated as provided by the professor of record or authorized departmental representative.
3. The Return of Title IV (R2T4) calculation is performed to determine the amount of federal funds the student has earned and the amount of unearned federal funds for which the school and the student is responsible to return, (if any).
   1. The percentage of aid a student has earned is determined by dividing the number of completed calendar days by the number of calendar days in the semester; this includes weeks and holidays and excludes any schedules breaks longer than five days.
      1. Academic calendars are all standard terms. St. Cloud State University does not offer programs in non-standard terms or clock hour.
   2. Calculations are completed using the MinnState Return of Title IV application, student’s attendance and withdrawal date, and are based upon the period of enrollment.
4. The Financial Aid Office will return the amount of any unearned portion of the Title IV funds for which the school and the student is responsible within 45 calendar days of the date the official notice of withdrawal was provided.
   1. Remaining unearned Title IV loan funds (e.g. Direct Loans) must be repaid by the student in accordance with the terms of the loans.
5. The Business Office will provide the student with a letter explaining any returns that have been made to the Title IV, HEA Federal programs on the student’s behalf as a result of exiting the program. If a student’s scheduled attendance is more than 60 percent of the period of enrollment, he/she is considered to have earned 100 percent of the Federal funds received for the period of enrollment. In this case, no funds need to be returned and no letter will be sent from Financial Aid.
   1. The initial amount of unearned Title IV aid due from the student (or parent, for Direct PLUS Loan funds) is determined by subtracting the amount returned by the school from the total amount of unearned Title IV funds to be returned. This is called the initial amount due from the student because a student does not have to immediately return loan funds or the full amount of any grant repayment due. Therefore, the student may not have to return the full initial amount due.
      1. The student loans that remain outstanding consist of the loans disbursed to the student minus any loans the school repaid. These outstanding loans are repaid by the student according to the terms of the student’s promissory note(s).
   2. The amount of grant overpayment due from a student is limited to the amount by which the original grant overpayment exceeds half (50%) of the total Title IV grant funds disbursed and could have been disbursed to the student.
      1. If the amount is less than $50.00, the student is not responsible for returning funds to Title IV grant programs. 
6. If a student’s scheduled attendance is more than 60 percent of the period of enrollment, he/she is considered to have earned 100 percent of the Federal funds received for the period of enrollment. In this case, no funds need to be returned and no letter will be sent from Financial Aid.
7. If it is determined that a Post Withdrawal Disbursement (PWD) is needed, the following occurs:
   1. A PWD of grant funds must be disbursed within 45 days of the date of the school’s determination.
   2. If the student is eligible for a PWD of loan funds:
      1. SCSU must offer the loan funds to the student within 30 days of the date of the school’s determination that the student has withdrawn.
      2. SCSU must provide at least 14 days for the student to either accept or decline those loan funds.
      3. SCSU must disburse the requested loan funds no later than 180 days after the request has been made.
8. A copy of the completed worksheet and notification letter will be kept in the student’s file.

Unofficially withdrawing from classes may affect the student’s future eligibility for financial aid due to Satisfactory Academic Progress (SAP) requirements and R2T4 balances owed.

Withdrawal Before 60 Percent Point of the Term

The institution must perform a R2T4 calculation to determine the amount of earned aid up through the 60 percent point in each period of enrollment.

Withdrawal After 60 Percent Point of the Term

For a student who withdraws after the 60 percent point of the period of enrollment, a student has earned 100 percent of the Title IV funds he or she was scheduled to receive during the period. Thus, there are no unearned funds. SCSU must still perform a R2T4 to determine the amount of aid that the student has earned and whether or not the student is eligible for a post withdrawal disbursement.

R2T4 for Modular Programs 

Beginning summer 2021 semester, in order to be compliant with Department of Education’s July 1, 2021 implementation date, SCSU implemented the amended CFR 668.22 (I)(6) for determining if a student is considered withdrawn when enrolled in modules, sessions and/or intersessions. Students in modular, sessions and/or intersessions are not considered withdrawn for R2T4 calculation purposes if:

• The student successfully completes one module that includes 49% or more of the number of countable days in the payment period with at least half-time enrollment; or
• The student successfully completes a combination of modules that when combined contain 49% or more of the number of countable days in the payment period with at least half-time enrollment; or
• The student successfully completes Title IV eligible coursework equal to or greater than halftime enrollment; or
• The student provides written confirmation of their intent to attend a Title IV eligible course beginning later in the term and no more than 45 calendar days after the end of the module the attendance ceased; or
• The student fulfills the graduation requirements within a module or combination of modules within the term.

If students are enrolled for multiple sessions during an academic term, and are packaged for Title IV aid using the enrollment of multiple sessions, then the NASFAA “Determining Whether a Student Has Withdrawn from a Standard – or Nonstandard- Term Program Offered in Modules” questions will be used to determine if the student qualifies as a withdrawn student.

To determine if a student plans to attend a Title-IV eligible course in a later module in the payment period or period of enrollment that begins no later than 45 calendar days after the of the end of the module they ceased attending, SCSU sends the student an email. If no response is received one week after the request has been made, the R2T4 is completed.

If a student confirms intent to attend in a module beginning later in the term, but does not actually return, the student is considered to have withdrawn, and the last date of attendance from the most previously attended course is used as the withdrawal date for the R2T4 calculation.

For a student who:

1. withdraws from a modular program;
2. does not provide intent to return to a later course;
3. had aid returned based on an R2T4 calculation;
4. re-enters the same program prior to the end of the payment period, the student is considered to have not withdrawn and is eligible to receive Title IV funds for which he or she was eligible prior to withdrawal, including funds returned under the return of Title IV funds provisions, and based on the enrollment status upon re-entry.

Order of Return

SCSU is authorized to return any excess funds after applying them to current outstanding Cost of Attendance (COA) charges. A copy of the Institutional R2T4 worksheet performed on the student’s behalf is available through the Financial Aid Office upon written request.

In accordance with Federal Regulations, when Title IV financial aid is involved, the calculated amount of the R2T4 funds is retracted in the following order:

• Federal Direct Unsubsidized Loan Program
• Federal Direct Subsidized Loan Program
• Federal Direct Graduate PLUS Loan Program
• Federal Direct Parent Loan Program (PLUS)
• Federal Pell Grants
• Iraq Afghanistan Service Grant (IASG)
• Federal Supplemental Educational Opportunity Grant Program
• Federal TEACH Grants

Earned Aid

Title IV, HEA aid is earned in a prorated manner on a per diem basis (calendar days) up to the 60 percent point in the semester. Title IV, HEA aid is viewed as 100 percent earned after that point in time. A copy of the worksheet used for this calculation can be requested in writing from the Financial Aid Office.

Post-Withdrawal Disbursement Conditions

If a student has accepted Title IV financial aid by the date of the withdrawal, but the financial aid has not disbursed, the student may be eligible for a post-withdrawal disbursement. If the amount disbursed to the student is less than the amount the student earned, and for which the student is otherwise eligible, he or she is eligible to receive a post-withdrawal disbursement for the earned aid that was not received. Under these circumstances, a R2T4 calculation must be performed to determine whether the student is actually eligible for a post-withdrawal disbursement. SCSU must make this determination within 30 calendar days after the student withdraws.

The following conditions apply when processing a post-withdrawal disbursement:

1. A student must have accepted aid by the date of the withdrawal.
2. If, before the student’s withdrawal date a loan offer has been accepted, the loan must also have been originated by SCSU.
3. In all Title IV loan programs, a promissory note must be signed for a loan to be included as aid that could have been disbursed in an R2T4 calculation. The signature may be obtained after the student withdraws. However, for the loan to be included as aid that could have been disbursed, the promissory note must be signed before the school performs the R2T4 calculation.
4. If the student is eligible for a post-withdrawal disbursement of a loan, the Financial Aid Office must send notification of post-withdrawal disbursement eligibility to students within 30 calendar days after the student withdraws. Students will be given a minimum of 14 calendar days to either accept or decline the post-withdrawal disbursement offer of the loan.
5. SCSU must disburse any Title IV grant funds a student is due as part of a post-withdrawal disbursement within 45 calendar days of the date SCSU determined the student withdrew and disburse any loan funds a student accepts by the post withdrawal disbursement deadline within 180 calendar days of the withdrawal date. The school must obtain written permission from the student before loan funds can be disbursed.
6. For students who provide notification back to SCSU that they want the loan funds prior to the post-withdrawal disbursement deadline, the Financial Aid Office will disburse the loan.
7. A school cannot make a post-withdrawal disbursement to a deceased student or a student who has not signed the loan’s promissory note. 

For students who provide notification back to SCSU that they want the loan funds prior to the post-withdrawal disbursement deadline, the Financial Aid Office will disburse the loan.

Time Frame for the Return of Title IV Program Funds

The following rules apply when completing a Return cal­culation for a student.

1. SCSU will return any unearned Title IV funds it is responsible for returning within 45 calendar days of the date SCSU determined the student withdrew, and offer any post-withdrawal disbursement of loan funds within 30 calendar days of that date.
2. Unless a student subject to verification has provided all required verification documents in time for SCSU to meet the Return deadlines, SCSU includes as Aid Disbursed or Aid That Could Have Been Disbursed in the Return calculation.
3. If it is determined that a student who failed to provide all required verification documents in time for SCSU to meet the Return deadline and later provides those documents prior to the applicable verification deadline, SCSU must perform a new Return calculation on all of the aid the student qualified for based on the completed verification documents and make the appropriate adjustments.
4. To give a Pell Grant to a student, SCSU must have a valid output document (one with an official Expected Family Contribution computed from correct data) while the student is still enrolled for the award year or in the time frame the student qualifies for a late disbursement under 34 CFR 668.164(j)(4)(i).
5. If it is determined that a Post Withdrawal Disbursement (PWD) is needed, the following occurs:
   1. A PWD of grant funds must be disbursed within 45 days of the date of the school’s determination.
   2. If the student is eligible for a PWD of loan funds:
      1. SCSU must offer the loan funds to the student within 30 days of the date of the school’s determination that the student has withdrawn.
      2. SCSU must provide at least 14 days for the student to either accept or decline those loan funds.
      3. SCSU must disburse the requested loan funds no later than 180 days after the request has been made.

Time Frame for the Return of an Unclaimed Title IV Credit Balance

In the event SCSU cannot locate the student (or parent) to whom a Title IV credit balance must be paid, Student Accounting (SFS) will determine what programs constitute the refund and will notify the Financial Aid office of any unclaimed credit balances that need to be returned to Title IV programs. The Financial Aid office must return the funds no later than 240 calendar days after the date the school issued the check or 45 calendar days after the EFT was rejected.

Institution Responsibilities

The following are SCSU’s responsibilities in regards to Title IV, HEA funds:

• SCSU will provide students with information in this policy.
• FAS will identify students who are affected by this policy and complete the Return of Title IV funds calculation for those students.
• Any Title IV, HEA funds required will be returned to the correct Title IV programs within 45 calendar days of the date the official notice of withdrawal was provided.
• If less Title IV aid has disbursed than the student has earned, a post-withdrawal disbursement will be calculated and must be offered.

The institution will always return all of the excess funds, including funds the Return of Title IV calculation identifies as the student’s responsibility to return.

Student Responsibilities

• Withdraws should be completed through the Student eService’s portal.
• Student must repay any funds to SCSU that were disbursed to the student in which the student was determined to be ineligible for via the R2T4 calculation
• Remaining Title IV loan funds must be repaid by the student in accordance with the terms of the loans.

Refund vs. Return of Title IV Funds

The requirements for the Return of Title IV program funds when a student withdraws are separate from any refund policy that SCSU may have to return to the student due to a cash credit balance. Therefore, the student may still owe funds to the school to cover unpaid institutional charges. SCSU may also charge the student for any Title IV program funds that they were required to return on the student’s behalf.

Return of Title IV Questions

Any have questions regarding Title IV program funds after visiting with or emailing the Financial Aid Office, please call the Federal Student Aid Information Center at 1-800-4-fedaid (800-433-3243). TTY users may call 800-730-8913. More information can be found by visiting Federal Student Aid.

This policy is subject to change at any time, and without prior notice.