Financial Implications of withdrawing from VCU
Students who receive federal Title IV grant or loan assistance and withdraw from VCU before completing 60 percent of the semester (as measured in calendar days) must have their eligibility recalculated based on the federal Return of Title IV Funds formula. This federal formula specifies that a student's financial aid eligibility must be recalculated based on the aid the student has "earned" (based on the number of days that the student was enrolled or attending VCU prior to withdrawal). Any unearned aid for the period of enrollment that the student did not complete must be returned to the appropriate Title IV program(s) from which the student was awarded.
VCU students who withdraw prior to completing 60 percent of the semester will have to pay all or a portion of the financial aid funds that were disbursed to their VCU student accounts. They also may be responsible for all or a portion of their university charges that were previously paid by financial aid sources.
The following cases illustrate how the federal Return to Title IV formula is applied. Please note that the cases are for example only and do not reflect actual dates and amounts.
Case 1: Sally is enrolled for 12 hours during the fall semester as an out-of-state student; the first day of classes for the program in which she is enrolled is Aug. 26 and the last day is Dec. 17. Sally's university charges and financial aid are as follows:
|Tuition and fees||$5,900|
|Financial aid||Amount||Date disbursed|
|Federal Pell Grant||$1,700||Aug. 26|
|Federal SEOG Grant||$1,800||Aug 26|
|Federal Direct Subsidized Loan||$2,000||Aug 28|
|Total financial aid||$5,500|
Financial aid funds of $5,500 were disbursed to her VCU student account toward tuition and fee charges of $5,900. Sally paid the remaining balance of $400 in cash.
Sally missed two weeks of classes because of an illness. She returned to classes on Sept. 25, but decided after two days that she was too far behind in her course work to catch up with classes. On Sept. 27, she notified the registrar that she was withdrawing and began the official withdrawal process. Since Sally withdrew on Sept. 27, she only completed 28.9 percent of the semester and is entitled to keep only 28.9 percent of her federal financial aid. Therefore, 71.1 percent must be returned to the federal government.
VCU must cancel $3,910 (all of the Federal Direct Subsidized Loan and Federal Pell Grant funds and $210 of the Federal SEOG Grant funds). These funds will be returned to the federal government on Sally's behalf. This action will create charges of $3,910 on Sally's VCU student account; however, because she withdrew from all classes during the fourth week, the tuition and fees of $5,900 would be reduced to $3,540 (a savings of $2,360). The result is that Sally must repay to VCU $1,550 that was previously paid by financial aid funds.
Case 2: Steve is enrolled for 15 hours during the fall semester as an in-state student; the first day of classes for the program in which he is enrolled is Aug. 26 and the last day is Dec. 17. Steve's university charges and financial aid are as follows:
|VCU charges||Amount||Retained by university|
|Tuition and fees||$1,900||0%|
|Room and board||$2,700||20% tuition and university fee 100% of all other fees|
|Total VCU charges||$4,600||40% tuition and university fee 100% of all other fees|
|Financial aid fundings||Amount||Date disbursed|
|Federal Direct Unsubsidized Loan||$2,000||Aug. 18|
|Federal PLUS Loan||$2,400||Aug. 23|
|Total financial aid||$4,400|
Financial aid funds of $4,400 were disbursed toward his student account charges of $4,600, and Steve paid the remaining balance of $200 using his credit card.
Sometime during the semester Steve stopped attending classes, but he did not notify anyone that he was withdrawing from school. He simply left the university. At the end of the semester his instructors reported grades of all "F"s since he had not completed his course work. Steve's last day of attendance is not known to VCU since he did not officially withdraw; therefore, the midpoint of the semester is used as the last date of attendance for Title IV funding purposes. This means that Steve earned only 50 percent of the financial aid that he had originally received for the semester. Therefore, 50 percent must be returned to the federal government.
VCU must cancel $2,200 (all of the Federal Direct Unsubsidized Loan funds and $200 of the Federal PLUS Loan funds.) These funds will be returned to the federal government the borrowers behalf. This action will create charges of $2,200 on Steve's account. Since Steve's withdrawal date for federal Title IV purposes was during the eighth week of classes, there is no tuition and fee adjustment. Because of the reduction of financial aid required by the federal Return of Title IV Funds formula, Steve must repay VCU $2,200 that was previously paid by financial aid funds.
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