Return of Title IV Aid (R2T4) Policy

How a withdrawal affects financial aid. Federal regulations require Title IV financial aid funds to be awarded under the assumption that a student will attend the institution for the entire period in which federal assistance was awarded. When a student withdraws from all courses for any reason, he/she may no longer be eligible for the full amount of Title IV funds that he/she was originally scheduled to receive. The return of funds is based upon the premise that students earn their financial aid in proportion to the amount of time in which they are enrolled. A pro-rated schedule is used to determine the amount of federal student aid funds he/she will have earned at the time of the withdrawal. Once 60% of the semester is completed, a student is considered to have earned all of his/her financial aid and will not be required to return any funds.

Federal law requires schools to calculate how much federal financial aid a student has earned if that student:

Completely withdraws, or
Stops attending before completing the semester, or
Does not complete all modules/sessions (courses that are not scheduled for the entire semester or payment period for which he/she has registered at the time those modules/sessions began). Based on this calculation, Mercy College of Ohio students who receive federal financial aid and do not complete their classes during a semester or term could be responsible for repaying a portion of the aid they received. Students who enroll in courses and do not attend must repay all financial aid disbursed for the semester.

How a withdrawal affects academics. The following information will help students understand how a withdrawal potentially affects them academically as well as financially. The financial aid staff members encourage students to read all the information below prior to making a final decision.

Mercy College of Ohio tuition refund policy is separate from the federal regulations to repay unearned aid. Whether or not a student receives a tuition refund has no bearing on the amount he/she must repay to the federal aid programs.

How the earned financial aid is calculated. Students who receive federal financial aid must “earn” the aid they receive by remaining enrolled in classes. The amount of federal financial aid assistance students earn is on a pro-rated basis. Students who withdraw or do not complete all classes for which they are enrolled during a semester may be required to return some of the financial aid awarded.

Institutions are required to determine the percentage of Title IV aid “earned” by the student and to return the unearned portion to the appropriate aid programs. Regulations require schools to perform calculations within 30 days from the date the school determines a student’s complete withdrawal. The school must return the funds within 45 days of the determination of a student’s withdrawal. For example, if a student completes 30% of the payment period, they earn 30% of the aid they were originally scheduled to receive. This means 70% of the scheduled awards remain “unearned” and must be returned to the federal government. Once 60% of the semester is completed, a student is considered to have earned all of his/her financial aid and will not be required to return any federal funds.

The following formula is used to determine the percentage of unearned aid that has to be returned to the federal government:

The percent earned is equal to the number of calendar days completed up to the withdrawal date, divided by the total number of calendar days in the payment period (less any scheduled breaks that are at least 5 days long).
The payment period is the entire semester.
The percent unearned is equal to 100% minus the percent earned.

For students enrolled in modules (sessions). A student is considered withdrawn if the student does not fulfill all the days in the payment period that the student was scheduled to complete. Mercy College of Ohio will track enrollment in each session to determine if a student began enrollment in all scheduled courses. If a student officially drops courses in a later module/session while still attending a current module/session, the student is not considered as withdrawn based on not attending the later module/session. However, a recalculation of aid based on a change in enrollment status may still be required.

Steps in the Return of Title IV Funds Policy

Mercy College of Ohio will determine:

The total amount of Title IV aid disbursed for the semester in which the student withdrew. A student’s Title IV aid is counted as aid disbursed in the calculation if it has been applied to the student’s account on or before the date the student withdrew.
The total amount of Title IV aid disbursed plus the Title IV aid that could have been disbursed for the semester in which the student withdrew.
If the calculated percentage of Title IV aid was earned as follows: the number of calendar days completed divided by the total number of calendar days in the semester in which the student withdrew. The total number of calendar days in a semester shall exclude any scheduled breaks of more than 5 days.
Days Attended ÷ Days in Enrollment Period = Percentage Completed
If the calculated percentage completed exceeds 60%, then the student has “earned” all the Title IV aid for the enrollment period.
The calculated amount of Title IV aid is earned as follows: The percentage of Title IV aid earned (Step 2) multiplied by the total amount of Title IV aid disbursed or that could have been disbursed for the semester in which the student withdrew.
Total Aid Disbursed × Percentage Completed = Earned Aid
The Amount of Title IV aid to be disbursed or returned
1. If the aid already disbursed equals the earned aid, no further action is required.
2. If the aid already disbursed is greater that the earned aid, the difference must be returned to the appropriate Title IV aid program.
3. Total Disbursed Aid – Earned Aid = Unearned Aid to be Returned
4. If the aid already disbursed is less than the earned aid, then Mercy College of Ohio will calculate a post-withdrawal disbursement.

Types of Withdrawals

For financial aid purposes, there are two types of withdrawals: Official and Unofficial.

Official – An official withdrawal from Mercy College of Ohio by the student.

Unofficial – Federal financial aid regulations consider a student to be an unofficial withdrawal if the student receives all “F” (failure) grades or a combination of “F” and “W” (withdraw) grades for the term.

Determination of the Withdrawal Date. The withdrawal date used in the return calculation of a student’s federal financial aid is the actual date indicated on the Withdrawal/Leave Form and/or the Drop/Withdrawal/Leave Form in EMPOWER ME. If a student stops attending classes without notifying Mercy College of Ohio, the withdrawal date will be the midpoint of the semester or the last date of academic activity determined by Mercy College of Ohio. Additional documentation supporting the last date of academic activity may be provided by the student if he/she verifies a later date of attendance than determined by Mercy College of Ohio.

Withdrawing prior to completing 60% of a term. Unless a student completes 60% of the term in which federal aid was disbursed, the student will be required to return all or part of the financial aid disbursed in the term. This applies to students who have officially or unofficially withdrawn.

When a student fails to begin attendance. If a student receives financial aid, but never attends classes, Mercy College of Ohio will return all disbursed funds to the respective federal aid programs. If the student owes money to Mercy College of Ohio resulting from the return of federal funds, the student will be billed by the Office of the Bursar. If the student does not pay the funds due to Mercy College of Ohio, a business hold will be placed on the student’s account. This means he/she will not be permitted to register for classes or receive transcripts until the balance is paid.

Students who do not receive an earned grade in a term. Financial aid is awarded under the assumption that the student will attend Mercy College of Ohio for the entire term for which federal assistance was disbursed. Mercy College of Ohio is required to have a procedure for determining whether a Title IV recipient who began attendance during a period completed the period or should be treated as a withdrawal. Students who attended class but failed to meet the academic requirements of the course are awarded a grade of “F”. This is an earned grade. Students who started a course but stopped attending class at some point and were given a grade of an “F” (failure), “W” (withdrawal), “IW” (instructor withdrawal), “WP” (withdrawal passing), or “WF” (withdrawal failing) are considered an “unofficial” withdrawal, and will be reviewed to determine the last date of an academically-related activity or the midpoint of the semester.

Repayment calculation process. Once grades are posted for the student who receives either all F’s, or “F” and “W” grades, Mercy College of Ohio will return all unearned aid to the federal aid programs and the student’s billing account will be charged. The Office of the Bursar will mail a bill to the student’s home address. The student is responsible for any balance due.

Definition of an academic-related activity. Examples of Mercy College of Ohio academic-related activities include, but are not limited to, physically attending a class where there is an opportunity for direct interaction between the instructor and students.

Proof of participation:

Exams or quizzes
Tutorials
Computer-assisted instruction
Completion of an academic assignment, paper or project
Participating in online discussion about academic matters
Initiating contact with a faculty member to ask a question about the academic subject in the course

Documentation not acceptable as proof of participation:

Student’s self-certification of attendance that is not supported by school documentation
Participating in academic advising

Repayment of Federal Aid Programs. Federal regulations require that the following aid programs be subject to the repayment calculation if the student did not attend 60% of the term in the following order:

Unsubsidized Direct Stafford Loan (undergraduate and graduate)
Subsidized Direct Stafford Loan (undergraduate)
Direct PLUS (Parent) Loan (undergraduate and graduate)
Federal Pell Grant (undergraduate)
Federal Supplemental Education Opportunity Grant (SEOG)(undergraduate)

Overpayment of Federal Grant Funds. Federal regulations provide that 50% of the unearned amount of all federal grants is protected by the federal calculation. Any federal grant money subject to repayment is returned by Mercy College of Ohio and that amount will be billed to the student’s billing account as a debt to Mercy College of Ohio.

Additional loan information to consider when withdrawing. When a student is enrolled less than part-time, the grace period begins. The student’s grace period for loan repayments for Federal Direct Unsubsidized and Subsidized Loans will begin on the day of the withdrawal from the school. If the student is not enrolled part-time for more than 6 months, the loans will go into repayment. The student must contact the U.S. Department of Education or his/her lender(s) to make payment arrangements. Loans must be repaid by the loan borrower (student/parent) as outlined in the terms of the borrower’s promissory note. The student should contact the lender if he/she has questions regarding the grace period or repayment status.

Repayment of unearned funds and consequences. Unearned funds are paid to the U.S. Department of Education by Mercy College of Ohio on the student’s behalf. The school will return the funds within 45 days of the calculation. If the student owes any money to Mercy College of Ohio resulting from the return of unearned federal financial aid, the student will be billed by Mercy College of Ohio. If the student does not pay the funds, a business hold is placed on the student’s account. This means he/she will not be permitted to register for classes or receive transcripts until the balance is paid in full.

School and Student responsibilities for the R2T4 policy & process.

Mercy College of Ohio’s responsibilities

Provide each student with the information given in this policy
Identify students affected by this policy and completing the R2T4 calculation
Inform the student of the result of the R2T4 calculation and any balance owed to Mercy College of Ohio as a result of a required return of funds
Return any unearned Title IV aid that is due to the Title IV programs and, if applicable, notifying the borrower’s holder of federal loan funds of the student’s withdrawal date
Notify student and/or PLUS borrower of eligibility for a Post-Withdraw Disbursement, if applicable

Student’s responsibilities

Become familiar with the R2T4 policy and how withdrawing from all courses impacts eligibility for Title IV aid
Resolve any outstanding balance owed to Mercy College of Ohio
Resolve any repayment to the U.S. Department of Education as a result of an overpayment of Title IV grant funds

How a withdrawal affects future financial aid eligibility. Refer to the Mercy College of Ohio Satisfactory Academic Progress Policy to determine how a withdrawal will impact future financial aid eligibility.

Note: The procedures and policies listed above are subject to change without advance notice based on changes to federal laws, federal regulations, or school policies. If changes are made, students must abide by the most current policy. For further guidance on R2T4 policies and procedures please contact the Mercy College of Ohio Office of Financial Aid.