Withdrawal and Impact on Financial Aid
Students who receive financial aid (federal, state, or institutional aid) and withdraw from classes during the semester are potentially subject to a review of their financial aid eligibility. The impact on a student's awards will depend on
- When the student withdrew from a class or classes.
- Whether the student withdrew from one or more classes, but remained enrolled or if the student completely withdrew from all classes.
- Type of financial aid awarded.
- Changes to the charges on the student's account.
Students need to talk with their financial aid counselor prior to withdrawing from any course(s) so that he/she can make an informed decision regarding the financial impact of the withdraw and understand how it could impact the future eligibility of some types of aid.
The following sections provide an overview of the impact of withdraws based on the type of aid received:
Federal Aid (Title IV)
Students who receive federal Title IV financial aid (Pell Grant, FSEOG, Perkins Loan, Federal Work-Study, or Direct Subsidized or Unsubsidized Loans) and who completely withdraw from all classes during the semester are subject to the Return of Title IV Funds calculation. This calculation does not apply to a student who withdraws from one or more classes but remains enrolled in one or more classes.
The calculation is based on the number of calendar days in the term compared to the number of days elapsed when the withdrawal is completed. Based on the percentage of the term completed, the student is allowed to retain a similar percentage of the federal Title IV financial aid. The remainder of the funds is to be returned to the federal programs. The school will determine how much of the federal funds are to be returned by the school and how much, if any, is to be returned by the student.
Funds will be returned in the following order if the student received money from the fund:
Federal Unsubsidized Direct Loan
Federal Subsidized Direct Loan
Perkins Loan
PLUS
Pell Grant
FSEOG
If the funds the student must repay need to be returned to the federal grant programs, the student will only have to repay 50 percent of the required grant. Students will be given 45 days to repay any grant monies owed. After 45 days, the student will be placed in a federal grant overpayment status and will be ineligible to receive federal funds, at any school, until the grant is repaid. Loan monies owed will become subject to the loan promissory note signed by the student.
Here is an example of how a calculation might work: If there are 100 calendar days in the term (excluding any breaks of five or more days) and the student withdraws on the 25th day, 25 percent of the term has elapsed. This means that 75 percent of the federal funds must be returned. If the student received $5,000 in federal Title IV aid, the $3,750 must be returned. If the school retained all of the funds to pay for school charged expenses, then the school will return all of the funds. If some of the funds were disbursed to the student, then the student may have to repay some of the funds also.
Institutional Aid
The institutional aid a student receives will follow the same guidelines as provided in the federal aid section above, except that institutional aid is limited to the amount of institutional charges after any adjustments are made based on the withdraw.
Indiana State Aid
The Commission for Higher Education (CHE) has a refund period that consists of the first four weeks of each academic term. If a student withdraws from one or more classes and thus is not classified as a full-time student at the end of the CHE refund period, the student is not eligible for any of their state grant funds. If a student withdraws from one or more classes after the CHE refund period, the impact on the student's state grants will depend on any adjustment of charges made on the student's account. Completing fewer than 30 credits each year can also negatively impact future eligibility of some state grants.
Additionally, withdrawal from a course may have an impact on completion rate, which can affect SAP standing. Please contact the Financial Aid Office at 765-677-2116 if you have any questions regarding the impact of a withdrawal on your student financial aid.
