Federal Loan Eligibility Policies
Return of Title IV Funds
Federal law and regulations require that IPS calculate a refund of tuition and fees for any student who withdraws from the Institute’s programs.
In addition, the Institute must calculate a return of Title IV funds for any student receiving financial aid used for the student’s tuition and fees for the period. The calculation is based on the percentage of the enrollment period completed and the amount of the Title IV aid disbursed. The return of Title IV funds calculation is separate from the Institute’s tuition refund policy. The Institute utilizes worksheets provided by the United States Department of Education (ED) to calculate the Return of Title IV funds. The following paragraphs describe the procedure and basis for the calculations.
The Institute calculates the return of Title IV funds based upon the official withdrawal information as determined by the Office of the Registrar. Using ED worksheets, the Institute divides the number of days completed by the number of days in the enrollment period to identify the percentage of time the student has completed in the enrollment period. If 60 percent or more of the semester has been completed, there is no return of the Title IV funds for the period.
When a return of funds to ED becomes necessary, the Institute multiplies the amount of funds disbursed to the student in Title IV funds by the percentage of time the student has completed. Then, the Institute subtracts the total amount of aid earned from the amount of aid disbursed. The Institute calculates its share of money to return by subtracting the amount the school must return from the total amount due. If the amount due to ED from the Institute is greater than the tuition and fees owed to the Institute, the school returns the greater amount. If the calculation shows a return of less than the refund calculation, the school returns the difference to the student.
In addition to the possibility of returning Title IV funds not earned during an enrollment period, students are required to repay loans obtained through the lender, based on the terms and conditions detailed in their promissory note(s). The student and the Institute are both required to return appropriate amounts to ED. A student’s failure to return funds they are not eligible to receive will result in the student being ineligible for further financial aid. In addition, the Institute and ED are required under federal regulations to seek legal action against the student to collect any funds the student is not entitled to retain.
The order in which ED will receive returned funds is as follows: unsubsidized Stafford loan funds first, then subsidized Stafford loan funds. The Institute will return unearned Title IV funds to ED by electronic transfer or draft to the Institute’s federal account within 30 days of determining that a student has withdrawn from the Institute.
Examples of these calculations are provided here.