Financial Aid Repayment Policy
When a student is awarded financial aid but does not complete the term, the agencies that provided the aid may require that YVCC and/or the student return a portion of that assistance. For federal and state financial aid, YVCC is required to calculate the portion of financial aid that has been “earned” by the student and determine if any of the “unearned” aid must be returned by the school or the student to the U.S. Department of Education of the State of Washington.
- Students who withdraw or are expelled before attending classes are not eligible for financial aid and must return/repay any aid that was disbursed. YVCC will return any funds that applied to the student’s account, and the student must repay all other aid that was disbursed.
- Federal and State financial aid recipients and others who qualify for aid, who begin attendance but withdraw from all classes, are expelled, or otherwise stop participating within a term, are required to repay federal and/or state aid funds based on the calculation of the “unearned” portion of their aid. The proportion of the aid that is “earned” is calculated by taking the number of calendar days of attendance divided by the number of calendar days in the term (excluding any period of 5 consecutive days when no classes are held). If the student has completed more than 50% of the term before withdrawal, the student is considered to have “earned” 100% of the state grant aid awarded; if the student has completed more than 60% of any term before withdrawal, the student is considered to have “earned” 100% of the federal financial aid. However, if the student completed less, the portion of “unearned” aid is the percent of the term that was unattended or 100% less the “earned” percentage, and is subject to repayment.
- For the purposes of this policy, the "award amount" is the amount of federal grants and state grants and the net amount of any federal loans for which the student was eligible after the school has made any required adjustments for need and enrollment level; work study earnings and awards are not included in repayment calculations All federal and state aid is included in the repayment calculation whether it was disbursed to the student account or to the student; however 50% of federal grant awards are protected from student repayment and state grant repayments are reduced by 50% in recognition of term start-up cuts incurred by the student.
- If a student withdraws after 60% of the term has been completed, no funds are returned to the federal or state government; of course, student loans must still be repaid according to the terms of the promissory note. If a student begins attendance but withdraws on or before 60% of the quarter has been completed, the amount of federal aid that must be returned by the school is based on the percentage of “unearned” aid compared to the institutional charges incurred by the student. The amount that must be repaid by the student is the remaining “unearned” amount comprised of federal grant funds after 50% of federal grants is protected and the student is permitted to repay any loan funds according to the terms of the loan’s promissory note. Similarly, if the student begins attendance but withdraws on or before the mid-point of the quarter, the student is responsible for repaying 50% of any unearned state grant funds.
- If attendance cannot be established by the financial aid office, 100% of the student’s aid must be returned, including aid that applied to institutional charges and aid that was delivered to the student. (In the case where the student’s attendance is not established, all aid including loans must be repaid immediately.) If attendance can be verified but a last date of attendance is not established, 50% of aid must be returned. If the last date of attendance for all classes is documented, , that date may be used to calculate the amount that must be returned, if this yields a lower repayment owed by the student.
- You may do your own calculation of the percent of earned and unearned aid and calculation of the amounts of federal aid that must be returned by downloading the worksheet, Treatment of Title IV Funds When a Student Withdraws from a Credit-Hour Program, at: http://ifap.ed.gov/aidworksheets/attachments/2010IASGCreditHourFinal.pdf.
Example 1. Amy Student was awarded Federal Pell Grant, Supplemental Grant and a State Need Grant and a subsidized Stafford Loan each quarter. In her second quarter, Amy became ill and missed 2 days of class in the second week. She tried to make up the class work but became ill again a month later and had to withdraw from classes. The day Amy withdrew was the 46th day of the term. There were 75 days in the term. Amy had attended 61% of the quarter (46 divided by 75 = 0.61333) and did not have to repay any state or federal financial aid.
Example 2. Stuart Sample received a Pell Grant, State Need Grant and Stafford Loan of $1000 each in the quarter. Stuart was in an accident and was forced to withdraw on the third day of the quarter. Since there were 75 days in the quarter, Stuart earned only 4% of his aid before the accident (3 divided by 75 is 0.0400). Thus, the unearned portion of his aid was 96% or $1920 Federal Aid AND $960 State Need Grant. Stuart’s institutional costs (tuition and fees) were $750 for the quarter. YVCC was required to refund to the federal government 96% of the $750, so YVCC returned $720 to the Stafford Loan Program, and reduced Stuart’s loan for the quarter from $1000 to $280 (net).
Since YVCC returned $720 to Stafford, Stuart’s potential obligation federal aid was reduced from $1920 to $1200. Stuart will already have to repay the remaining $280 Stafford Loan based on the promissory note he’s already signed, leaving a remaining potential federal obligation of $920 for Pell Grant. Federal repayment rules protect 50% of federal grants for start of term costs. So $500 of the Pell Grant is protected from repayment and Stuart will need to repay $420 of his Pell Grant (the $920 potential debt less the protected $500). For State aid, the unearned portion of state grant is $960. 50% of the obligation is protected so Stuart owes $480 back to the State Need Grant program. Since Stuart withdrew in the first week classes and he was entitled to 100% tuition refund.
Example 3. Emmy Awardee was a student who withdrew on the 30th day of the quarter. Like Stuart, Emmy received $1000 in Pell Grant $1000 in State Need Grant and $1000 in Stafford Loan that quarter and was charged $750 in tuition and fees. However, Emmy earned 40% of her financial aid (30 days divided by 75 days is 0.4000) and 60% of her aid or $1200 was “unearned”. YVCC returned $450 to her Stafford loan (60% of her $750 charges), reducing her net loan for the quarter to $550. Since she will repay the remaining $550 Stafford Loan according to her promissory note, her remaining federal obligation is just $200. Since $500 of her Pell Grant is protected (i.e. 50% of her federal grant), Emmy will not have to repay any Pell Grant. Emily’s unearned State Need Grant is 60% of $1000 or $600; she is obligated to repay 50% of this amount or $300. And, because Emmy did not withdraw until 30 days into the quarter, she is not entitled to a tuition refund. Therefore, of her $750 tuition, $450 was returned to the federal government; Emily now owes $300 to YVCC for her tuition.