Federal Funds, Repayment
Students who completely withdraw from the university during the semester without participating through 60% of the semester may be required to return a percentage of their Federal Financial Aid. All types of Federal Financial Aid are included in this repayment, including: Federal Pell Grants, Federal TEACH Grants, Federal Supplemental Grants, and Federal Direct and PLUS Loans.
The amount of repayment is based on institutional charges and the percentage of the semester completed. For example, if a student withdraws after completing 40% of the semester (calculated using calendar days), the school must return 60% of the student’s Federal Financial Aid that was or could have been allocated to tuition, fees, and USU housing/USU meal plans, if any. See example below.
Federal funds are returned by USU in the following order until the calculated amount to return has been exhausted:
- Federal Unsubsidized Direct Loans
- Federal Subsidized Direct Loans
- Federal Direct PLUS Loan (Graduate students)
- Federal Direct PLUS Loan (Parent)
- Federal Pell Grant
- Federal SEOG Grant
- Federal Teach Grant
- Iraq Afghanistan Service Grant
Example:
A student with $4615 in tuition and fees has Federal Aid in the following amounts:
| Federal Pell Grant |
$1,500 |
| Federal Subsidized Direct Loan |
$2,750 |
| Federal Unsubsidized Direct Loan |
$1,000 |
| Total Federal Aid |
$5,250 |
- If the semester has 105 calendar days and the student drops all their classes on day 26,The return of funds would be calculated as follows: Day 26 divided by 115 calendar days = .247 or, 25% of the semester completed, 75% of the semester not completed.
- USU must return 75% of the federal aid allocated for tuition & fees: $4615 Tuition & Fees x 75% = $3461 return of funds
- USU would repay $1000 of the Unsubsidized loan, $2461 of the Subsidized Loan to the federal loan originator.
- This return of funds would reduce the student’s outstanding federal loan balance, but,
- USU would bill the student for $3461.
- Amounts returned to the loan originator can be borrowed again in a future term, if the student is otherwise eligible.
Students who withdraw from USU after the third week of school (20% of the term or session) generally do not receive tuition refunds but may appeal to the Registration office if there were extenuating circumstances for the withdrawal.
Please note that federal grant and TEACH recipients must document academic participation in each of their classes (including attending class, taking exams, turning in assignments, etc.) in order to avoid repaying additional grant money in addition to the returns discussed above.
- A student who never begins attendance in their classes will be required to return 100% of their aid including student loans.
- Federal aid recipients may need to help the financial aid office document academic participation in each of their classes (including attending class, taking exams, turning in assignments, etc.) in order to avoid repaying additional grant money for which they are not eligible.
- An online-only student with no graded assignments, quizzes, or tests may be required to return100% of their aid including student loans.
- Students who cease attending after completing 60% of the semester may not have to return any federal aid after their account has been reviewed.
If the student is eligible for a refund of tuition and fees, according to the university refund policy, there fund will be applied to the Federal Financial Aid Repayment. A refund may not completely repay the federal aid balance. The student may not be allowed to register for future classes until the balance is repaid.
Please note: Loan and grant funds returned by the school because of withdrawal must be repaid immediately to USU. Remaining loan funds, if any, will go into repayment according to the terms of the loan.
More information can be found at usu.edu/financialaid/standards/r2t4.
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