Federal Return of Funds Regulations

Federal Return of Title IV Funds

For any questions regarding the return of Title IV funds, please see the Financial Aid Office, located in the main building.

Students Who Withdraw from all Courses in a Semester

Federal regulations require the OCCC Financial Aid Office to perform a calculation to determine the dollar amount of earned and unearned Federal Student Aid funds for students who officially or unofficially withdraw from a semester. Students must attend 60% of the semester to earn all funds.  Any unearned funds must be returned to the appropriate Federal Student Aid program within 45 days of the determination that the student withdrew.

Total Withdrawal Before Completing 60% of the semester

Financial aid recipients who withdraw (officially or unofficially) and have completed 60% or less of the semester at the time of withdrawal are subject to the Return of Title IV federal fund regulations (R2T4). For a 16-week semester, 60% is approximately 10 weeks.

For the purpose of determining a refund to the Title IV programs, a student shall be deemed to have withdrawn from the College if any of the following occurs:

  • The student withdraws (officially or unofficially) from the College.
  • The College determines the student has failed to maintain Satisfactory Academic Progress, failed to abide by the College’s policies and procedures, or failed to meet financial requirements.
  • The student failed to attend for 14 consecutive days (excluding holidays and scheduled breaks).




For the purpose of determining the date that a student withdrew, the student shall be determined to have withdrawn when any of the following occurs:

  • The date the student withdraws from all courses at the College.
  • The date the College terminates the student’s enrollment.
  • The day the student failed to attend classes for 14 consecutive days (excluding holidays and weekends).

An R2T4 calculation of earned funds is based on the number of calendar days the student attends, according to the official OCCC record, and the number of calendar days in the semester. The percentage of time in attendance determines the amount of earned. The remaining percentage is unearned.

If the R2T4 calculation determines that OCCC must return Federal Student Aid funds for institutional charges, including, tuition, fees, and any books or supplies charges to Federal Student Aid, OCCC will invoice the student for the returned funds.

If the calculation determines that the student must also return Federal Student Aid funds, OCCC will return the unearned portion owed by the student, and will bill the student for the returned funds.

The student will be notified through their OCCC email and/or direct USPS mail of the amount of funds returned and the amount, if applicable, still owed to the College.

Student should check with the Financial Aid Office for the exact date of the 60% point each semester.

Calculation Example

  • Student withdraws on day 54 in a 113-day semester (Sundays and breaks are not included in the count)
  • 54 days/113 days=47.8% earned and the remaining amount 52.2% is unearned
  • Student tuition and fees for the semester totals $547.00
  • Federal funds disbursed to the student for the semester
    • Subsidized Direct Loan $ 1,312.00 Pell Grant $ 1,562.00
    • Total Disbursed $ 2,874.00 x 47.8% = $1,374 unearned funds
    • $2,874.00 disbursed - $1,374.00 earned = $1500.00 unearned
  • OCCC must return the unearned percentage of charges $547.00 x 52.2% = $286.00 to the Direct Loan program
  • The student must repay the unearned loan funds $1,312.00 - $286.00 = $1,026
  • The remaining unearned portion $1,214.00 - $1,026 = $188.00 is Pell funds which are considered protected by Federal Student Aid Pell Grant rules. Students are not required to return unearned Pell funds less than 50% of the Pell disbursement.

The school and the student are required to return any unearned funds in the following order:

  1. Unsubsidized Federal Direct Stafford Loan
  2. Subsidized Federal Direct Stafford Loan
  3. Federal Direct Plus Loan
  4. Federal Pell Grant
  5. Federal SEOG

Students taking 8-week or 5-week courses semester (modules)

Students who are only taking 8-week or 5-week or a combination of such courses including Intersessions are considered a withdrawal if they do not complete all days scheduled to complete within the module. Calculations vary from students who are in module courses. Please review the Information Sheet: Calculating Return of Funds for Students in Module Courses.

Students who fail to earn a passing grade in any course for the semester

When a student earns all 'F' or 'U' grades in a semester, OCCC is required to perform a Return of Federal Student Aid calculation based on the official OCCC record date of attendance when the student has all 'F' or 'U' grades. Students receiving a combination of failing grades (F,W,U,I) the latest official OCCC record date will be used as the last date the student was enrolled for the semester and will be used in the calculation to determine the percentage of earned funds.

Students who Fail to Begin Attendance

If a student fails to begin attendance and the academic department has no record of beginning attendance, OCCC is required to complete a Return of Funds calculation.

Beginning attendance for on-campus is defined as attending the first day.

Beginning attendance for online courses is defined as participating in discussions, asking or answering a question from the professor or otherwise be involved in an academic activity. Logging into the class is not sufficient to determine attendance.

For students receiving Federal Direct Stafford Loan funds and never beginning attendance in any course, OCCC is required to return all loan funds credited to the student's account and any payment made by the student or on behalf of the student for the semester, not to exceed the amount of the loan.

If a student begins attendance in some courses, but not all, the OCCC Financial Aid Office may be required to return Pell and Federal Direct Stafford Loan funds depending on the student's enrollment level.

If the student falls below half-time enrollment status prior to the close of the add/drop period, no additional loan funds will be disbursed and the Pell Grant amount will be adjusted, based on the new enrollment status.

Post-Withdrawal Disbursement

If a student whom OCCC has determined is eligible to receive Federal Student Aid funds withdraws from OCCC after beginning attendance, the Financial Aid Office must determine the amount of Federal Student Aid grant or loan assistance earned by the student.

If the amount disbursed to the student is less than the amount the student earned, the student is eligible to receive a post-withdrawal disbursement.

OCCC Financial Aid Office will apply the post-withdrawal disbursement to the student's account to pay institutional charges and other authorized charges, not to exceed $200 for prior year charges. Any remaining funds will be disbursed to the student.

The student will receive a written notification of the availability of the post-withdrawal funds. For Federal Direct Stafford Loans the student or the parent for PLUS loans must respond within 14 calendar days to accept the loan funds.