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Return of Aid Funds for Withdrawal 

 

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NORTHEAST ALABAMA COMMUNITY COLLEGE RETURN OF TITLE IV STUDENT FINANCIAL AID FUNDS FOR WITHDRAWALS

Sec. 484B, 485(a)(1)(F), 34 CFR 668.22 The Higher Education Amendments of 1998,
Public Law 105-244

The Higher Education Amendments of 1998, Public Law 105-244 changed substantially the way funds paid toward a student’s education are to be handled when a recipient of Student Financial Aid Program funds withdraws from school.

Up through the 60% point in each payment period or period of enrollment, a pro rata schedule is used to determine how much Student Financial Aid (SFA) Program funds the student has earned at the time of withdrawal. After the 60% point in the payment period or period of enrollment, a student has earned 100% of the SFA Program funds.

Calculation of Amount of SFA Program Assistance Earned
The amount of SFA Program assistance earned by the student is determined by multiplying the percentage of the payment period completed by the total amount of SFA Program
assistance that was disbursed or that could have been disbursed for the payment period or period of enrollment as of the day the student withdrew.

Percentage of the Payment Period orPeriod of Enrollment Completed
The percentage of the payment period or period of enrollment completed is the total number of calendar days in the payment period or period of enrollment for which the assistance is awarded divided into the number of calendar days completed in that period as of the day the student withdrew.

Disposition of Differences between Amount Earned and Amount Received
If the student receives less SFA Program assistance than the amount earned, the school must comply with the procedures for late disbursement specifi ed by the Department in regulations. If the student receives more SFA Program assistance than the amount earned, the school, or the student, or both, must return the unearned funds as required, and in the order specified, below.

Return of Unearned SFA Program Funds
Northeast Alabama Community College must return the lesser of:
• The amount of SFA Program funds that the student does not earn; or
• The amount of institutional costs that the student incurred for the payment period or period of enrollment multiplied by the percentage of funds that was not earned.
• The student must return or repay, as appropriate, the remaining unearned SFA Program grant funds.
• The student must return 50 percent of grant funds over awarded.

Method of Return of Funds by the Student
Grant overpayments are subject to repayment arrangements satisfactory to the school, or overpayment collection procedures prescribed by the Secretary of Education.

Order of Return of SFA Program Funds
• Federal Pell Grants for the payment period for which a return of funds is required.
• Federal Supplemental Educational Opportunity Grants (FSEOG) for the payment period for which a return of funds is required.
• Other assistance under this Title for which a return of funds is required.

Northeast Alabama Community College students who register for classes, benefit from Title IV student financial aid and then withdraw are subject to the withdrawal policy as stated in the Higher Education Amendments of 1998.

Students who do not repay will be reported to the Federal government for collection.