Return to Title IV for US Federal Student Aid Procedure

Intent

To specify the conditions and requirements for the administration of US Federal Student Aid funds, which are received by the University on behalf of eligible students and which must be returned when those students withdraw from their studies.

Scope

This procedure applies to all students who are US citizens or eligible US non-citizens, who apply for US Federal Student Aid while studying at James Cook University (JCU) Townsville or Cairns campuses.

This procedure applies to new and continuing, international and domestic US Federal Student Aid students enrolled at JCU.

Definitions

Except where otherwise indicated in this procedure, the definitions used in this procedure are found in the US Federal Student Aid - SAP & Return to Title IV Policy or the Policy Glossary.

Financial Aid office/administrator: Staff member/s suitably trained and familiar with the legislative requirements in the administration of the Title IV program at JCU. JCU’s Financial Aid office is located within the compliance unit, International Directorate.

Institutional Charges - for Title IV Purposes: Study related fees which are payable by students to the University. These include tuition fees and the Student Services & Amenities (SSA) fees. These do not include library fines, field trip expenses, and accommodation related costs.

Loan Payment Period: Period of time within a Teaching Period for which the student is enrolled and a loan can be awarded.

For coursework, the Payment Period begins on the first day of the main Study Period and ends on the last day of the same Study Period for that Teaching Period.

For research, the Payment Period begins on the first day of the main research period, and ends on the last day of the same research period. The Payment Period will be adjusted to the first day of enrolment (new students) or the date of submission (completing students) where a student is not enrolled for a full research period.

R2T4: “Return to Title IV” is the acronym commonly used by the US Department of Education in relation to the treatment of US Federal Student Aid funds when a student withdraws.

Withdrawal: “Withdrawal” refers to a student’s intent to completely terminate studies at JCU.

Introduction

JCU is registered as a provider to certify and administer US Federal Aid loan applications (Title IV funds) for eligible students from the United States, and who are studying at the University.

This Procedure operates separately and in addition to the Student Fee Payments and Refunds policy, and serves to detail how JCU will administer US Federal Student Aid funds when a student withdraws, as governed by the Federal Regulations of the Offices of the Department of Education (Section 34CFR 668.22), and in accordance with the US Federal Student Aid - SAP & Return to Title IV Policy.

Where a student withdraws from their studies, and Title IV funds have been released by the US Department of Education, the University must determine whether the student is eligible for the loan amount, and if not, return funds to the US Department of Education as required.

Procedure

1.  Return of funds

1.1 When a student who is funded by the US Federal Student Aid Program withdraws, the University will return unearned funds received under that program in accordance with this procedure.

The University will:

(a) Calculate the R2T4 amount, including the University’s and the student’s portion of that amount, within 30 days from the date the institution determined the student withdrew; and

(b) Return the University’s unearned portion of the R2T4 amount to the United States Government within 45 days from the date the institution determined the student withdrew.

2.  Withdrawal notification process

2.1   To be considered an official withdrawal, students must:

(a) Coursework students must contact the International Student Support team. HDR Candidates must submit a Variation of Candidature Form to the Graduate Research School; and

(b) Advise the JCU Financial Aid office of their withdrawal.

2.2   Students who lodge a withdrawal request will be provided with exit counselling, which will include information about their loan repayment obligations and options.

2.3   Students who do not inform the University of their withdrawal, will be considered unofficially withdrawn.

3.  Date of Withdrawal

3.1   The University will determine the date when a student is considered to be withdrawn.

Official Withdrawal – the withdrawal date will be:

(a) The date a student notifies the University, in writing, that they intend to cease attendance during a Payment Period, or

(b) In the case where a student intends to complete the current payment period and has notified the University in advance, the official study period completion date, or

(c)  In the case where a student has completed the first payment period within an annual loan period and does not intend to re-commence study in the subsequent payment period, the first official study period completion date.

Unofficial Withdrawal – the withdrawal date will be:

(d) In the case where withdrawal is determined by report (eg non-attendance identified by JCU academic or support staff) during the payment period, the date the University identified the student ceased attendance, or

(e) In the case where withdrawal is determined by outcomes (eg academic results for the current payment period reflect non-attendance and/or non-submission of assessment), the official study period completion date, or

(f)  In the case where a student has completed the first payment period within an annual loan period and does not re-enroll in the subsequent payment period, the first official study period completion date, or

(g) Where exceptional circumstances (eg accident, illness or grievous personal loss) impacted the student’s ability to notify the University, the date will be determined related to that circumstance.

4.  Calculation of R2T4 amount, including University and student portions

4.1 If a student withdraws during the loan payment period, the R2T4 amount to be returned will be the amount of unearned aid. This will be determined, as at the date of student withdrawal, on the basis of the calculation formulas provided by the U.S. Department of Education.

a)  The percentage of aid earned in any loan payment period will be determined on the basis of the percentage of the student’s attendance as follows:

• i. The number of calendar days completed by the student in the payment period is divided by the total number of calendar days of the payment period excluding scheduled breaks of five days or more or periods for which the student has been granted leave of absence.
• ii. This calculation is represented by the following formula:

Note: See clause 8 in relation to leave of absence.

(b) If the percentage calculated through application of this formula is greater than 60%, the amount of aid earned by the student is considered to be 100% of the applicable aid.

(c) Where this percentage calculated through application of this formula is less than or equal to 60%, the amount of aid earned by the student is determined by multiplying this percentage by the total amount of the aid disbursed.

(d) The unearned amount of aid will be the amount equivalent to the remaining percentage of the relevant payment period. (For example, if the student withdraws after completing 40% of the payment period, the R2T4 or unearned amount will be 60% of the applicable aid.)

(e) The University’s portion of the R2T4 amount is the percentage of the University’s allowable institutional charges for the loan payment period, equal to the remaining percentage of the payment period after deduction of the proportion completed by the student. (For example, if the student withdraws after completing 40% of the payment period, the University’s portion of the R2T4 amount will be 60% of the University’s charges for the payment period).

(f) If the University’s portion of the R2T4 amount is a dollar amount less than the total dollar amount of all unearned aid, the University will return the amount of the University’s portion.

(g) If the University’s portion is a dollar amount greater than the total amount of unearned aid, the University will return the total amount of unearned aid.

(h) Any amount of the total R2T4 amount that remains after the University’s portion is returned becomes the student portion of the return. This amount, if any, is repayable after the student leaves the University in accordance with the repayment terms and conditions attached to the applicable loan(s). The student will not be liable for these funds immediately upon withdrawal.

(i) Students are responsible for ensuring that all earned loan funds they receive are repaid according to the terms of the loan.

5.  Returning unearned aid funds

5.1 The University’s Financial Aid and the Student Finance office, in consultation with the Accounts Payable team, are responsible for processing the return of unearned aid to relevant recipients.

Unearned funds (i.e. the R2T4 amount) must be returned to the appropriate program(s), in the following order:

(a) firstly, to Unsubsidised Federal Stafford Direct Student Loans;

(b) secondly, to Subsidised Federal Stafford Direct Student Loans; and

(c) finally, to Federal PLUS Direct loans.

6.  Post-withdrawal disbursements

6.1 A student who has not received all the aid funds they earned may receive a post-withdrawal disbursement of the remaining earned funds.

6.2 The University will notify the student and any parent borrower of eligibility for a post-withdrawal disbursement.

6.3 A student entitled to receive a post-withdrawal disbursement may decline it.

6.4 If the student owes outstanding fees to the University at the time of a post-withdrawal disbursement, these amounts will be deducted from any such disbursement.

6.5   Where a credit balance on the student account existed prior to withdrawal, or as a consequence of withdrawal, any refund due to the student will be placed on hold until after the R2T4 calculation is finalised. Any credit balance deemed refundable to the student thereafter will be processed within 14 days.

7.  Funds outstanding to the University

This Procedure operates separately and in addition to the Student Fee Payments and Refunds policy.

The University may also seek re-imbursement from a student directly for any funds outstanding and for any U.S. Federal Aid returned.

8.  Leave of absence

8.1 A student who is funded by the United States Federal Student Aid Program may be granted an approved leave of absence only if it meets the below criteria.

(a) the student follows the University’s procedure in requesting the leave of absence;

(b) the University determines there is a reasonable expectation that the student will return to the University;

(c) the University will not charge the student additional fees when he or she returns from the leave of absence;

(d) the number of days of approved leave of absence does not exceed 180 days in any 12 month period;

(e) the University explains to the student, prior to granting the leave of absence, the effects that the student's failure to return from a leave of absence may have on the student's loan repayment terms, including the exhaustion of some, or all, of the student's 180 day grace period; and

(f) upon the student's return from the leave of absence, the student is permitted to complete the coursework he or she began prior to the leave of absence, or continues research without notable setbacks.

8.2 Where a Leave of Absence is approved for the purposes of US Federal Student Aid, this will be the status reported to the US government.

8.3 A student who submits a request for a leave of absence that does not meet the criteria will be reported to the US government as a withdrawn student. A R2T4 calculation will be completed in accordance with this procedure and the 180 day grace period for loan repayment will commence from the date the student began the leave of absence.

8.4 Requests for a leave of absence must:

(a) be submitted through the JCU Leave of Absence Application form (online or in hard copy) or Variation of Candidature form (HDR students);

(b) state the reason(s) for the request;

(c) specify the dates for commencement and end of the leave of absence; and

(d) be signed and dated by the student

(e)  be communicated to the Financial Aid office

Note: A student can have a leave of absence approved by the university, but not approved for US Federal Aid purposes.  If this occurs, the student’s enrolment will be reported to the U.S. Department of Education as a withdrawal, however the University will keep the student’s place in the program. The University’s policies and procedures will continue to apply.

Related policy instruments

US Federal Student Aid - SAP & Return to Title IV Policy

Satisfactory Academic Progress for US Federal Student Aid Procedure

Academic Progression Policy

Coursework Enrolment Procedure

HDR Variation and Extension of Candidature Procedure

Student Fee Payments and Refunds Policy

Related documents and legislation

The Higher Education Act of 1965, re-authorised by The Higher Education Opportunity Act - 2008

Code of Federal Regulations (34, Subtitle B, Chapter VI, parts 668.16)

Code of Federal Regulations (34, Subtitle B, Chapter VI, parts 668.34)

Code of Federal Regulations (34, Subtitle B, Chapter VI, parts 668.22)

Administration

NOTE:  Printed copies of this procedure are uncontrolled, and currency can only be assured at the time of printing.

Approval Details

Revision History