Policy Portal

Administrative Policy: Academic

Financial Aid Return of Title IV and Institutional Aid Policy

Policy Number: 3349-AC-256
Effective Date: 07/01/2020
Updated: 4/01/2021
Reviewed:
Responsible Department: Office of Financial Aid
Approval Authority: VPAA

A. Purpose

The purpose of this policy is to establish what occurs relative to a student’s financial aid when they fall below half-time status or cease to be enrolled in the curriculum, which may affect the amount of Title IV, Health Resources and Services Administration (HRSA) Funding, or NEOMED-Based Financial Aid and loans awarded in that Payment Period.

B. Scope

This policy applies to all NEOMED students who receive Federal Title IV, HRSA Funding, or NEOMED-Based Financial Aid who withdraw, are approved for a leave of absence (medical, enrichment, or University-mandated); are academically dismissed, or fail to begin coursework, and have received a disbursement of financial aid funds for the period of enrollment/payment period. Federal Student Aid (also known as Title IV), NEOMED-Based Financial Aid, and HRSA Funding are awarded to a student under the assumption that a student will complete coursework for the entire period for which the financial aid source was awarded and disbursed. NEOMED’s Office of Financial Aid will use a calculation developed by the U.S. Department of Education to determine the amount of financial aid disbursed at the start of the Payment Period, the amount of financial aid the student is able to retain (“Earned”) versus the amount they are ineligible to retain (“Unearned”).

C. Definitions

  1. “Credit Balance Refund” refers to when the total amount of Financial Aid (NEOMED-Based Financial Aid, Title IV, or HRSA Funding) exceeds the total charges assessed to the student for the Payment Period.
  2. “Earned Financial Aid” refers to financial aid that a student is eligible to receive based on their attendance in a degree granting program.
  3. “Health Resources and Services Administration (HRSA) Funding” refers to federal funding that is awarded to NEOMED through a grant application process and is administered by the Office of Financial Aid utilizing the terms and conditions set forth by HRSA. Funding under HRSA includes, but is not limited to, Title VII Loan Programs (Loan for Disadvantaged Students, Primary Care Loan, Health Professions Student Loan) and the Scholarship for Disadvantaged Students.
  4. “NEOMED-Based Financial Aid” includes all funding from the NEOMED Foundation, NEOMED operating budget, and NEOMED business arrangements. Institutional funds available to NEOMED students include scholarships (need and non-need), need-based loans, and forgivable loans.
  5. “Payment Period” refers to a period in which all classes are schedule to begin and end within a set timeframe. The Payment Period may include the combination of the standard term and an intersession term.
  6. “Period of Enrollment” refers to the timeframe during which a student is engaged in curricular activity.
  7. “Post-Withdrawal Disbursement” refers to Title IV, Title VII or NEOMED based scholarships and loans that a student earned for the Period of Enrollment they attended but were not eligible for disbursement until after the student’s withdrawn status became effective.
  8. “Return of Title IV Calculation” refers to a federal formula developed by the U.S. Department of Education used to determine the percentage of Earned and Unearned Title IV Financial Aid. It is also the calculation used to determine Earned and Unearned HRSA Funding and NEOMED-Based Financial Aid.
  9. “Title IV Financial Aid” refers to funding from the Federal Student Aid Office of the United States Department of Education. Title IV Financial Aid available to students include loans from the William D. Ford Federal Direct Loan (Direct Loan) Program, the Direct Unsubsidized Loans, and Direct PLUS Loans (Graduate PLUS).
  10. “Unearned Financial Aid” refers to financial aid that a student receives at the start of a Payment Period under the expectation they would complete the entire Payment Period, but due to their withdrawal, are not eligible to receive.
  11. “Withdrawn Status” refers to conditions when a student is no longer eligible for Title IV, HRSA Funding, and NEOMED-Based Financial Aid because their registration drops to less than half time status, they withdraw or are dismissed from NEOMED, or are approved for a leave of absence that lasts longer than 180 days.

D. Policy Statement

Per federal regulations, when a student’s registration falls below half-time status or ceases attendance at NEOMED, the amount of Unearned Title IV Financial Aid received by the student must be determined. NEOMED adopts the same calculation to determine the amount of Unearned NEOMED-Based Financial Aid, and for HRSA Funding.

  1. Determination of Withdrawal Date
    1. Official declaration by the Office of the Registrar. When a leave of absence, formal withdraw or dismissal by a NEOMED student is declared, the Office of the Registrar will notify affected offices through a Student Status Update that includes the status change and the effective date of the status change. The effective date will be used as the change in enrollment status and used in the Return of Title IV Calculation.
    2. Unofficial withdrawals. In the event that a student does not properly declare a leave of absence or withdraw, the Office of Financial Aid will seek from the appropriate college the last date the student was engaged in curricular activity by use of examination registration, attendance sheets, login activity and participation in online courses. The last date of engagement in the curriculum will be used to determine the end date of the student’s engagement in the Period of Enrollment.
    3. Failure to begin coursework. If a student receives a disbursement of financial aid assistance and never begins coursework for a Payment Period, the student will be considered having never been enrolled and all financial aid will be returned. In the event a student received a Credit Balance Refund, it is the student’s responsibility to surrender the refund, in accordance to the Aid Disbursement and Credit Balance Refund Policy.
    4. In the event a student is owed a Credit Balance Refund at the time of a leave of absence, withdrawal or dismissal, NEOMED will not issue the refund to the student until a Return of Title IV Calculation is performed to ensure the student is eligible for the funds. Any eligible credit balance refunds after the calculation will be issued to the student within fourteen (14) days of when the Return of Title IV Calculation is complete.
  2. Return of Title IV Calculation
    1. Using the Return of Title IV Calculation issued by the U.S. Department of Education, the percentage of Earned Financial Aid is equal to the number of calendar days completed up to the end of the Enrollment Period divided by total number of calendar dates in the Payment Period. Exclusions in this calculation include breaks lasting longer than five (5) consecutive days (e.g., if a student is given five days for spring break, the time period for spring break would not count as part of the calendar days in the Payment Period).
      1. Earned Percent = Number of Days Completed in the Payment Period/ Total Days in the Payment Period
      2. Unearned Percent = 100% – Earned Percent
    2. In cases where the Earned percent is sixty percent (60%) or greater, no financial aid will be returned, as the federal regulations view the aid has been “100% earned” after that point in time.
  3. Responsibility of University and Student Regarding Returning Funds
    1. NEOMED is responsible for returning a portion of Unearned Title IV Financial Aid to the federal government. The Return of Title IV calculation worksheet will direct the Office of Financial Aid as to the amount the student is obligated to return, what NEOMED is required to return, and from which Title IV loan program. NEOMED-Based Financial Aid as well as Unearned HRSA Funding will be credited to the program they were awarded from based on an internal calculation like the federal calculation.
    2. The student is responsible for returning their portion of Unearned direct loans to their servicer, as determined by the Return of Title IV Calculation. In addition, the student may be responsible for payment of funds to NEOMED if NEOMED returns a greater portion of instructional fees than the amount able to be returned to the student. NEOMED-Based Financial Aid and HRSA Funding do not require a separate return by the student.
  4. Order of Returning Unearned Aid
    1. Title IV Financial Aid
      1. In accordance with federal regulations, Unearned Financial Aid will be returned to the federal government within forty-five (45) days of the student’s last day of Period of Enrollment in the following order:
        1. Federal Direct Unsubsidized Loan; or
        2. Federal Direct Grad PLUS Loan.
    2. NEOMED-Based Financial Aid and HRSA Funding
      1. Funds from Unearned NEOMED-Based Financial Aid and HRSA Funding will be returned to the program they were disbursed from and allocated to eligible students.
  5. Post-Withdrawal Disbursements
    1. Post-Withdrawal Disbursements are funds that could have been disbursed during the Payment Period to the student but were not disbursed as of the date of NEOMED’s determination that the student withdrew. Disbursements for future payment periods are not eligible for Post-Withdrawal Disbursements.
    2. Determining student eligibility for Post-Withdrawal Disbursement
      1. Any Post-Withdrawal Disbursements of Direct Loan funds due must meet the required conditions for late disbursements:
        1. NEOMED must have had a valid Free Application for Federal Student Aid (FAFSA) record with an official Expected Family Contributionefore the student became ineligible. The processing date on the FAFSA will be used to determine eligibility.
        2. NEOMED must have originated the loan prior to the date the student became ineligible.
      2. Any Post-Withdrawal Disbursement of NEOMED-Based Financial Aid or HRSA Funding due must meet the required conditions for late disbursements as follows:
        1. Scholarships/grants: The student was eligible at the time of withdrawal, and the disbursement was already scheduled prior to the date the student became ineligible.
        2. NEOMED-Based and Title VII loans: The student must have accepted the loan prior to the date the student became ineligible.
    3. Determine the amount of a Post-Withdrawal Disbursement
      1. The amount of a Post-Withdrawal Disbursement is determined by utilizing the Return of Title IV Calculation.
      2. For a student who withdraws after completing sixty percent (60%) of the Payment Period, even though a return of Title IV aid is not required, if the student is eligible for a Post-Withdrawal Disbursement then a Return of Title IV Calculation will be completed to determine whether the student has any funding eligibility for a Post-Withdrawal Disbursement.
      3. According to federal law, NEOMED may not make a Post-Withdrawal Disbursement of Title IV funds to the account or estate of a student who has died.
    4. NEOMED must notify a student in writing prior to making any Post-Withdrawal Disbursement of loan funds within thirty (30) days of the date of NEOMED’s determination that a student has withdrawn. The notification will:
      1. provide the information necessary for the student to make an informed decision as to whether the student would like to accept any disbursement of loan funds, including the advantages of keeping loan debt to a minimum;
      2. request confirmation of any Post-Withdrawal Disbursement that the student wishes to make and explain that the student may accept or decline all or a portion of the funds; and
      3. identify the type and amount of the loan funds that NEOMED wishes to credit to the student’s account balance or disburse directly to the student.
        1. The notification will make clear that a student may not receive as a direct disbursement loan funds that NEOMED wishes to credit to the student’s account balance. If the student does not wish to accept some or all of the loan funds that NEOMED wishes to credit to the student’s account balance, NEOMED will not disburse the funds.
    5. NEOMED must notify a student in writing if there is a late disbursement of NEOMED-based scholarships and loans. These funds will automatically be disbursed without separate acceptance by the student.
    6. Disbursement of post-withdrawal funds
      1. NEOMED will disburse the funds with a student’s confirmed desire to disburse loan funds.
      2. Funds will be applied to any outstanding balance due first and then any credit will be released to the student as a student credit balance refund.
      3. A Post-Withdrawal Disbursement must be made within 180 days of the date that NEOMED determined that the student withdrew.
  6. Tuition/Fee Recalculation
    1. Students may be eligible to receive a refund of instructional fee, non-resident surcharge and in some cases, mandatory fees. Students should consult the NEOMED Tuition, Fees and Insurance Refund Policy.
  7. Student Notification Process
    1. Upon Completion of the Return of Title IV Calculation, students will receive a copy of the calculation and a notice of any payment due to the University by the NEOMED Accounting Office. Instructions will be provided to the student on the amount of Unearned Title IV Financial Aid that must be repaid by the student.
  8. Effects of Withdrawing, Leave of Absence or Dismissal on Student Loans
    1. Students whose enrollment status is less than half-time will not be considered enrolled for the purpose of student loans, beginning on the date of determination. Students will enter their eligible grace period on their student loans. In cases where a grace period does not exist, active repayment will begin within thirty (30) days. In cases when a leave of absence lasts longer than 180 days, the Office of the Registrar will report enrollment status as withdrawn, per federal guidelines. The withdrawn status does not negate the leave of absence status with the University.
    2. Students with a leave of absence lasting longer than 180 days are obligated to remain in contact with their loan servicer and make required payments or apply for applicable deferment/forbearances.
    3. In cases of Title IV and Title VII and NEOMED-based loans, exit counseling is required. Instructions on how to complete the exit counseling will be provided by the Office of Financial Aid (for Title IV Loans) and the NEOMED Accounting Office (for NEOMED-based and Title VII loans).
  9. Regaining Eligibility
    1. Students with a balance due to NEOMED because of a return of Title IV, NEOMED-Based Financial Aid and/or HRSA Funding will be required to pay the balance in full before they will be able to register to return to the curriculum from a leave of absence.
    2. Students should refer to the NEOMED Satisfactory Academic Progress for Financial Aid Eligibility Policy to ensure they are meeting the academic expectations to receive federal and institutional aid assistance.

CONTACT

Lisa Noland
Administrative Specialist
Phone: 330.325.6354
Email: lnoland@neomed.edu

Office of General Counsel

Northeast Ohio Medical University