New Aid Officer Training Return to Title IV (R2T4) Patrick Harris Athens Technical College

New Aid Officer Training Return to Title IV (R2T4) Financial aid is awarded to a student under the assumption that she will attend school for the entire period for which the assistance is awarded. When a student withdraws, the student may no longer be eligible for the full amount of Title IV financial aid funds that he was originally scheduled to receive. Title IV financial aid funds include federal loans and grants. R2T4 2

New Aid Officer Training Return to Title IV (R2T4) As a recipient of Title IV financial aid funds, if the student withdraws from school after the drop/add period, a calculation is performed to determine whether a student who completely withdraws during a term has “earned” the monies disbursed. A student “earns” his/her aid based on the period of time enrolled. General Requirements 3

New Aid Officer Training Return to Title IV (R2T4) Example : If the student ONLY completed 30% of the period of enrollment, the student has only earned 30% of the assistance s(he) was originally scheduled to receive. Once the student has completed more than 60% of the period of enrollment, the student has earned all the financial aid s(he) was scheduled to receive. R2T4 4

New Aid Officer Training Return to Title IV (R2T4) The percentage of the period that the student remained enrolled is derived by dividing the number of days the student attended by the number of days in the term (i.e. 30 days enrolled / 100 day term) The withdrawal date is: – The date the student notified the institution of intent to withdraw (initiation of withdrawal process) or – The midpoint of the term for a student who leaves without notifying the institution of their intent to withdraw. R2T4 5

New Aid Officer Training Return to Title IV (R2T4) The responsibility to repay unearned aid is shared by the institution and the student in proportion to the aid each is assumed to possess. Once the institution’s portion of the return of funds has been calculated the Office of Student Financial Aid will reduce the student’s original financial aid awarded and return the funds within 45 days to the appropriate programs. R2T4 6

New Aid Officer Training Return to Title IV (R2T4) The school must return the lesser of: the amount of Title IV funds that the student does not earn; or the amount of institutional charges that the student incurred for the payment period or period of enrollment multiplied by the percentage of funds that was not earned. The percentage not earned is determined by subtracting the percentage of Title IV aid earned from 100%. Title IV aid to be returned 7

New Aid Officer Training Return to Title IV (R2T4) Treatment of TIV Funds for R2T4 Worksheet (Appendix B) 8

New Aid Officer Training Return to Title IV (R2T4) Create R2T4 Reports 9

New Aid Officer Training Return to Title IV (R2T4) A school must return funds to the programs in the following order: 1. Unsubsidized Direct Stafford loans (other than PLUS loans). 2. Subsidized Direct Stafford loans. 3. Federal Perkins loans. 4. Direct PLUS loans. 5. Federal Pell Grants for which a return of funds is required. 6. Academic Competitiveness Grants for which a return of funds is required. 7. National Smart Grants for which a return of funds is required. 8. Federal Supplemental Educational Opportunity Grants (FSEOG) for which a return of funds is required. 9. Federal Teach Grants for which a Return is required. 10. Iraq Afghanistan Service Grant for which a return is required. Title IV aid to be returned 10

New Aid Officer Training Return to Title IV (R2T4) A school will be considered to have returned funds timely if the school does one of the following as soon as possible, but no later than 45 days after the date it determines that the student withdrew: deposits or transfers the funds into the school’s federal funds bank account; initiates an electronic funds transfer (EFT) to an account belonging to the student; initiates an electronic transaction that informs the ED, in the case of a Direct Loan, to adjust the borrower’s loan account for the amount returned; or issues a check. Timeframe for the return of Title IV funds 11

New Aid Officer Training Return to Title IV (R2T4) The regulations limit the amount a student must repay to the amount by which the original overpayment amount exceeds 50 percent of the total grant funds disbursed or could have been disbursed by the student for the payment period or period of enrollment. A student does not have to repay an original grant overpayment of $50 or less for grant overpayments resulting from the student’s withdrawal. Grant overpayments may be resolved through – 1. full and immediate repayment to the institution; 2. repayment arrangements satisfactory to the school; or 3. overpayment collection procedures negotiated with Borrower Services. Grant Funds to be Returned by a Student 12

New Aid Officer Training Return to Title IV (R2T4) Repayment terms for students who owe Title IV grant overpayments were established to ensure that students who could not immediately repay their debt in full had the opportunity to continue their eligibility for Title IV funds. Students who owe overpayments as a result of withdrawals initially will retain their eligibility for Title IV funds for a maximum of 45 days from the earlier of the – - date the school sends the student notice of the overpayment, or - date the school was required to notify the student of the overpayment School’s Responsibilities in the Return of Funds by the Student 13

New Aid Officer Training Return to Title IV (R2T4) Within 30 days of determining that a student who withdrew must repay all or part of a Title IV grant, a school must notify the student that he or she must repay the overpayment or make satisfactory arrangements to repay it. In its notification a school must inform the student that: 1.The student owes an overpayment of the TIV funds. 2.The student’s eligibility for additional Title IV funds will end if the student fails to take positive action by the 45th day following the date the school sent or was required to send notification to the student. There are three positive actions a student can take to extend his or her eligibility for Title IV funds beyond 45 days: a. The student may repay the overpayment in full to the school. b. The student may sign a repayment agreement with the school. Note: Two years is the maximum time a school may allow for repayment. c. The student may sign a repayment agreement with the Department. If the student takes no positive action during the 45-day period, the school should report the overpayment to NSLDS immediately after the 45-day period has elapsed. School’s Responsibilities in the Return of Funds by the Student 14

New Aid Officer Training Return to Title IV (R2T4) If the amount disbursed to the student is less than the amount the student earned, the amount may be considered a post- withdrawal disbursement. Post withdrawal eligibility can be used to credit outstanding charges on a student’s account. The institution has 30 days from the date the institution determined that the student withdrew to offer any amount of the post withdrawal disbursement to the student, (or parent for PLUS) Post – Withdrawal Funds 15

New Aid Officer Training Return to Title IV (R2T4) In the notification, the school must advise the student or parent an institution may set a deadline of 14 days or more to be eligible to receive the post withdrawal disbursement. The notification must make it clear that if the student or parent does not respond to the notification within the timeframe, the school is not required to make the Post-withdrawal disbursement; however, a school may choose to make a Post-withdrawal disbursement based on an acceptance received from a student or parent received after school’s deadline. Post – Withdrawal Funds 16

New Aid Officer Training Return to Title IV (R2T4) Students who leave school do not always notify the school of their withdrawal. There are two categories of these unofficial withdrawals for purposes of this calculation. First, if the school determines that a student did not begin the withdrawal process or otherwise notify the school of the intent to withdraw due to illness, accident, grievous personal loss, events beyond the student’s control, then the withdrawal date is the date the school determines the circumstances beyond the students control. 17 Post – Withdrawal Funds

New Aid Officer Training Return to Title IV (R2T4) The second category of unofficial withdrawals encompasses all other withdrawals where official notification is not provided to the school. For these withdrawals the withdrawal date is the midpoint of the payment period or period or enrollment. Official Notification Not Provided 18

New Aid Officer Training Return to Title IV (R2T4) The institution must determine the withdrawal date (for a student who withdrew without providing notification) within 30 calendar days from the earlier of (1) The end of the payment period or period of enrollment, (2) the end of the academic year, or (3) the end of the student’s educational program. Time Frame For an Unofficial Withdrawal 19

New Aid Officer Training Return to Title IV (R2T4) Students who do not earn a passing grade in ALL courses attempted and have provided a last date of attendance will have to provide verification of their last date of attendance at an academically related activity. Examples of academically related activities are: Examinations or quizzes, Tutorials, Computer- assisted instruction, Academic advising or counseling, and Academic conferences. R2T4 – No Passing Grades 20

New Aid Officer Training Return to Title IV (R2T4) If the student never attended the institution (i.e. No Show), all aid will be reversed for that term (if previously disbursed). In the absence of evidence of a last day of attendance at an academically related activity, the student who failed to earn a passing grade in any class is considered to be an unofficial withdrawal. If documentation is not received, then a Return of Title IV calculation will occur using 50% as the point for the unofficial date of withdrawal. No Passing Grades Con’t. 21

New Aid Officer Training Return to Title IV (R2T4) Census Date (Add/Drop; Freeze Date; Completion Date) - For Pell purposes, a school MAY set a date after which no adjustments are made to a student’s enrollment status Referred to as a Pell recalculation date Adjust status upward and downward Adjust after census date only if Pell initial calculation occurs after the census date - If using multiple census dates (usually with mini-terms), the furthest census date out for the terms the student is enrolled in will be the timeframe within which enrollment status adjustments must be made Census Dates 22

New Aid Officer Training Return to Title IV (R2T4) Enrollment status for 2 nd Pell award eligibility based on status as of census date (if used) If no Census Dates used, Pell enrollment status is: -Adjusted throughout the entire term, or -Use the status as of when the Pell is initially calculated No earlier than the process date on the ISIR Pell enrollment status always adjusted for any classes the student never starts - Includes not starting mini-terms Census Dates 23

New Aid Officer Training Return to Title IV (R2T4) Current requirements: -If enrolled in mini-terms within a semester, if a student completes at least one course, student NOT considered to be withdrawn for TIV purposes (no R2T4) -If student does not complete a course, considered withdrawn and R2T4 applies -Student’s enrollment status always adjusted for any mini- term enrolled in but not started – whether R2T4 applies or not Proposed Regulations: - If a student does not complete all mini-terms enrolled in, student is considered withdrawn (unless taking a semester long course) R2T4 and Mini-Terms 24

New Aid Officer Training Return to Title IV (R2T4) Our Student -Marcy 25 Fill out top of R2T4 worksheet We determined Marcy withdrew yesterday Our school calculates R2T4 on a payment period basis –In this case, Spring Semester

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 1 26 Enter student’s Title IV aid as either disbursed or could have been disbursed Note that loans are separate from grants A = Grant $ disbursed B = Loan $ disbursed C = Grant $ TCHBD D = Loan $ TCHBD

New Aid Officer Training Return to Title IV (R2T4) Marcy’s Spring Financial Aid Package 27 ProgramAmount Pell$2000 FWS$1000 State Grant$500 Direct Loan Sub Stafford$1741 (net) Direct Loan Unsub Stafford$995 (net) Private Student Loan$2000 School Scholarship$3000

New Aid Officer Training Return to Title IV (R2T4) Aid That Could Have Been Disbursed 28 Student met conditions for a late disbursement ( (g)(2)) – At time student withdrew, ED had processed a SAR or ISIR with official EFC –Pell/ACG/National SMART –ISIR with eligible EFC –FFEL –loan had been certified –DL –loan had been originated –TEACH –grant had been originated –Perkins/FSEOG –funds had been awarded

New Aid Officer Training Return to Title IV (R2T4) $ Included in Calculation vs $ That Can Be Disbursed 29 Counter intuitive to include funds in calculation that you will not disburse to student However, one set of regs govern the calc Another set of regs govern what can be disbursed –More restrictive

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 2 30 Find out how much of the payment period Marcy completed

New Aid Officer Training Return to Title IV (R2T4) STEP 2: Withdrawal Date –School Not Required to Take Attendance 31 Use the earlier of –date student began school’s withdrawal process or date student otherwise provided “official” notice; or –midpoint in period (if student didn’t notify school); or –If student didn’t notify due to circumstances beyond student’s control, the date related to that circumstance

New Aid Officer Training Return to Title IV (R2T4) 32 School not required to take attendance always has the option of using the date of student’s last attendance at an academically related activity as documented by the school STEP 2: Withdrawal Date –School Not Required to Take Attendance

New Aid Officer Training Return to Title IV (R2T4) 33 IF… school is required to take attendance by outside entity (such as state or accrediting agency) THEN... withdrawal date is taken from attendance records NOTE: Requirement might apply only to specific groups of students STEP 2: Withdrawal Date –School Not Required to Take Attendance

New Aid Officer Training Return to Title IV (R2T4) Calendar Days at Credit-Hour Schools 34 Count every day, including weekends and holidays, except: Scheduled break of five or more consecutive days when no classes are offered Days of leave of absence are not included in total days

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 2 35 Marcy started on the first day of Spring Semester, February 1, 2010 The last day of Spring Semester is May 11, 2010 Marcy “unofficially” withdrew Our school is not required to take attendance

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 3 36 What % of her aid would Marcy have earned had she NOT withdrawn? What % did Marcy, in fact, earn SINCE she withdrew? % completed x Total Title IV aid disbursed and TCHBD = T4 Earned by student

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 4 37 Does Marcy have a return or a PWD? If a return, continue with R2T4 calc –Step 4 Box K If a PWD, go to PWD Tracking Sheet

New Aid Officer Training Return to Title IV (R2T4) 38 Step 4 is calculating the Total Return –School part –Student part Marcy –R2T4 Worksheet Step 4

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 5 39 What is the school’s part of the Total Return?

New Aid Officer Training Return to Title IV (R2T4) 40 The institutional charges at Marcy’s school are $3000 tuition/fees –Calculated before any withdrawal related reduction in institutional costs Determine % of unearned Title IV aid Institutional costs x % of unearned T4 = amount of unearned charges Compare Total Title IV to Return to amount of unearned charges Lesser amount is School part of return Marcy –R2T4 Worksheet Step 5

New Aid Officer Training Return to Title IV (R2T4) Step 6: Return of Funds by School 41 Law specifies order of Title IV programs to which funds must be returned –See worksheet Never return more money than was received from a Title IV program

New Aid Officer Training Return to Title IV (R2T4) 42 Return funds to program(s) as soon as possible, but no later than 45 calendar days after the date of determination of withdrawal –Calculation must be completed within 30 calendar days of the date of determination of withdrawal Step 6: Return of Funds by School

New Aid Officer Training Return to Title IV (R2T4) 43 What are the amounts that the school will return to each T4 program for Marcy? Why does the school have to return these funds for Marcy? Step 6: Return of Funds by School

New Aid Officer Training Return to Title IV (R2T4) Step 7: Return of Funds by Student 44 Total T4 to return –what school has returned = initial amount of student part Initial amount may change because the student gets different, and more favorable, treatment in the calc in later steps

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 7 45 What is Marcy’s part of the return (initial amount) Total T4 to return –what school has returned = initial amount of student part

New Aid Officer Training Return to Title IV (R2T4) Step 8: Repayment of Student’s Loans 46 Student is responsible to repay any loan funds not returned by the school Loans are repaid in accordance with terms of the promissory note

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 8 47 What is the amount of Marcy’s loans that make up the initial amount of her return? What does “according to the terms of the promissory note” mean Is this different from the standard the school was held to?

New Aid Officer Training Return to Title IV (R2T4) Marcy –R2T4 Worksheet Step 9 & Marcy has no grant funds to return This will occur for many students who have no grants or a combination of loan and grants

New Aid Officer Training Return to Title IV (R2T4) Rick –R2T4 Worksheet Step 9 & Rick received no loans Rick received $2780 in T4 grants After the school returned its portion, Rick had an initial amount of $900 to return

New Aid Officer Training Return to Title IV (R2T4) Rick –Calculating Grant Overpayment –Step 9$ 50

New Aid Officer Training Return to Title IV (R2T4) Step 10: Return of Funds by Student 51 Any grant repayment due from student is considered an overpayment Student is responsible for repayment –Amounts of $50 or less in any program are set aside Law specifies order of Title IV programs to which funds must be returned –See worksheet

New Aid Officer Training Return to Title IV (R2T4) Create R2T4 Reports 52

New Aid Officer Training Return to Title IV (R2T4) Dear Colleague Letter GEN (December 2000) Dear Colleague Letter GEN (November 2004) R2T4 Demonstration Site avalable at: R2T4 website available through FAA Access to CPS Online: Additional Resources 53

New Aid Officer Training Return to Title IV (R2T4) Technical questions on the Return of Title IV funds Web product are handled by the CPS at: or Technical Questions 54