Withdrawal and Return of Title IV Funds
Students earn federal financial aid by attending class (i.e. completing all scheduled days). Any unearned portion must be returned to the appropriate Title IV program. Federal law specifies how Sinclair must determine the amount of Title IV program assistance that you earn if you withdraw from school. The Title IV programs offered by Sinclair that are covered by this law are: Federal Pell Grants, Federal Supplemental Educational Opportunity Grants (FSEOG), Federal Iraq and Afghanistan Service Grants, Federal Direct Loans, and Federal PLUS Loans.
Calculating a Return of Title IV Funds When a Student Withdraws
When you withdraw during your payment period or period of enrollment, the amount of Title IV program assistance that you have earned up to that point is determined by a specific formula. If you received (or if Sinclair or your parent received on your behalf) less assistance than the amount that you earned, you may be able to receive those additional funds. If you received more assistance than you earned, the excess funds must be returned by Sinclair and/or you to the U. S. Department of Education (ED). You will be responsible for repayment of the funds to Sinclair that it paid to the ED on your behalf.
The amount of assistance that you have earned is determined on a prorated basis. For example, if you completed 30% of your payment period or period of enrollment, you earned 30% of the assistance you were originally scheduled to receive. Once you have completed more than 60% of the payment period or period of enrollment, you earn 100% of the assistance that you were scheduled to receive for that period. That is, there are no unearned funds.
Withdrawing from a Course or All Classes Affects a Student's Financial Aid
Students receiving financial aid who withdraw or stop attending, in most cases, will be required to return a portion of financial aid received. A student should submit an official withdrawal from classes form to the Registration & Student Records office (RSR). Before withdrawing or stopping attendance in classes, the student should be aware of the proper procedure for withdrawing from classes and the consequences of withdrawing or stopping attendance. Official withdraw is the responsibility of the student. The Sinclair Official Withdrawal Policy is available online at: https://catalog.sinclair.edu/#policies/Academic/Official-Withdrawal-from-College-Policy
Questions on Return of Title IV Funds may be addressed to the Financial Aid & Scholarships office. Questions on withdrawal should be addressed with an Academic Advisor.
The Withdrawal Date
The withdrawal date used in the Return of Title IV calculation is the actual date the official drop form is received by the Registration and Student Records office. If a student stops attending classes without notifying Sinclair, the withdrawal date will be the midpoint of the semester or the last date of recorded attendance at an academically related activity in a course for which attendance was established during the attendance verification period.
Post Withdrawal Disbursements
If you did not receive all of the funds that you earned, you may be due a post-withdrawal disbursement. Sinclair will notify the student within 30 days of the date of determination of withdrawal concerning the post withdrawal disbursement. If your post-withdrawal disbursement includes loan funds, Sinclair must get your permission (or your parent's permission for a Direct PLUS Loan) before it can disburse the funds. You (or your parent for a Direct PLUS Loan) may choose to decline some or all of the loan funds so that you do not incur additional debt. The student (or parent if a PLUS loan) must respond within 14 days of the date the post-withdrawal disbursement notification was sent. Entrance counseling must be completed before funds are disbursed.
Sinclair may automatically use all or a portion of your post-withdrawal disbursement of grant funds for tuition and fees and will apply those funds to your student account within 45 days of the date of determination of your withdrawal from Sinclair. Sinclair needs your permission to use the postwithdrawal grant disbursement for all other school charges. If you do not give your permission (Sinclair may ask for this when you enroll or register), you will be offered the funds. However, it may be in your best interest to allow Sinclair to keep the funds to reduce your debt at the school.
There may be some Title IV funds that you were scheduled to receive that cannot be disbursed to you once you withdraw because of other eligibility requirements. For example, if you are a first-time, firstyear undergraduate student and you did not complete the first 30 days of your program before you withdrew, you will not receive any Direct Loan funds that you would have received had you remained enrolled past the 30th day.
Returning Unearned Federal Funds
If you receive (or if Sinclair or your parents receive on your behalf) excess Title IV program funds that must be returned, Sinclair must return a portion of the excess equal to the lesser of:
Sinclair will return Title IV funds in the following order:
The required return of Title IV funds will be made to the Title IV programs within 45 calendar days of the date of determination of withdrawal.
In addition to returning unearned loan and grant funds due from the school to the Title IV program, Sinclair will return those excess unearned grant funds due from you to the Title IV program. You will be required to repay Sinclair for the student portion of the funds returned to the Title IV programs.
Any loan funds that you (or your parent for a Direct PLUS Loan) are eligible to keep must be repaid in accordance with the terms of the promissory note. That is, you make scheduled payments to the holder of the loan over a period of time agreed upon by you (or your parent for a Direct PLUS loan).
Any amount of unearned grant funds that you must return is called an overpayment. The maximum amount of a grant overpayment that you must repay is half of the grant funds you received or were scheduled to receive. You do not have to repay a grant overpayment if the original amount of the overpayment is $50 or less. You must make arrangements with Sinclair to repay the Sinclair the amount of the unearned grant funds paid on your behalf by the college.
The requirements for refunds and repayments of Title IV program funds when you withdraw are separate and different from any Sinclair refund policy. The institutional refund policy determines the amount of tuition and other charges owed the College and has no impact on the Return of Title IV funds calculation. Therefore, you may still owe funds to Sinclair to cover unpaid institutional charges. Sinclair may also charge you for any Title IV program funds that the school was required to return. Students are encouraged to review Sinclair's refund policy which can be found online at: www.sinclair.edu/bursar-refund-policy or you may ask Sinclair for a copy of its refund policy.
Sinclair can also provide you with a copy of the requirements and procedures for an official academic withdrawal from courses or an administrative withdrawal or you can review it online at: https://catalog.sinclair.edu/#policies/Academic/Official-Withdrawal-from-College-Policy
If you have questions about your Title IV program funds, you can call the Federal Student Aid Information Center at (800) 4-FEDAID (800-433-3243). TTY users may call 1-800-730-8913. Information is also available on Student Aid on the Web at: www.studentaid.ed.gov
All information contained in the Withdrawal and Return of Title IV Funds Policy is subject to change based on changes to federal law, regulation, or Sinclair's policy and procedure. If changes are made, students must abide by the new policy.
Note: In many instances, the student will owe a balance to Sinclair based on the returns made by Sinclair to the U.S. Department of Education. Please see a Sinclair Financial Aid officer for additional information.
Please see a Sinclair Financial Aid Officer for additional information.
Example Calculation of Return of Title IV Funds
The following example illustrates how the federal Return of Title IV Funds policy would affect a student who withdraws from classes at Sinclair Community College:
A student is attending Fall Semester full-time, which is 120 calendar days in length. Classes are scheduled for the entire semester. The student withdraws from classes on the 30th day of the semester.
The student's financial aid and charges are:
Federal Pell Grant $2,775.00
Direct Subsidized Stafford loan +2,750.00
Total Financial Aid awarded $5,525.00
Tuition and fees (institutional charges) ($1,581.00)
Financial aid refund disbursed to student
after tuition and fees are paid $3,944.00
Student withdraws from classes on the 30th day of the semester, which is the Wednesday of the fifth week.
The percentage of the financial aid earned:
Completed Days 30
÷ Total Days in Payment Period 120
= Percentage of Aid Earned 25%
Amount of Federal Financial Aid Earned:
Percentage of Aid Earned 25%
Total Financial Aid Awarded × 5,525.00
Aid Earned Based on Completed Days $1,381.25
Percentage of Federal Financial Aid Unearned
100% - Percentage of Aid Earned 75%
Amount of Federal Financial Aid to be Returned:
Total Financial Aid Awarded $5,525.00
Aid Earned Based on Completed Days - $1,381.25
Financial Aid to be Returned to DOE $4,143.75
Responsible Party for Returning Funds ($4,143.75) to the U. S. Department of Education (DOE):
Sinclair Returns $1,185.75*
*To determine the amount Sinclair must return, compare the following amounts: 1) The total amount of unearned aid is $4,143.75. 2) The institutional charges of $1,581.00 multiplied by the unearned percentage (75%) is $1,185.75. Sinclair must return the lesser of these two amounts. The remainder is the student's portion to return.
Student's Portion (4,143.75 – 1,185.75) $2,958.00
Funds are returned in the prescribed order shown above, loan programs first and then grant programs.
**Sinclair would return $1,185.75 to the Direct Subsidized Stafford Loan program, creating a balance of $1,187.75 on the student's Sinclair account. The student is responsible for paying the Sinclair balance of $1,185.75.
The student's portion to return is calculated as $2,958.00 . Because Sinclair returned $1,185.75, the student's loan for the semester has been reduced to $1,564.25 ($2,750.00 -$1,185.75) , which the student repays to the U.S. Department of Education in accordance with the terms of the Master Promissory Note (MPN) (by beginning payments six months after graduation or dropping below six credit hours.)
The remaining balance of the student's portion to return is $1,393.75 ($2,958.00 - $1,564.25). This amount is from the Federal Pell Grant program. The actual amount which the student must return to the U.S. Department of Education for the grant programs is reduced by 50% of the original grant amount ($2775 x 50% = $1,387.50). The amount remaining after this Title IV grant protection is applied is $6.25 ($1393.75 -$1387.50). The student is not responsible for returning funds to the grant programs that are under $50.00. Therefore, the student in this example would not be required to return any funds to the Federal Pell Grant program.
Student portion to be returned
Student portion $2,958.00
Loan returned during repayment - 1,564.25
Student still needs to return for grant program $1,393.75
50% Title IV grant protection - 1,387.50
Grant amount remaining $ 6.25
- Last Revised: 10/09/2013