Return to Title IV (R2T4):

When a student withdraws or his/her enrollment at Charles and Sue's is otherwise terminated, the School will not only calculate the amount of tuition/fees that will be refunded to the student (if any), but also the amount of federal financial aid (aka “Title IV”) that must be returned to the Federal Student Aid Programs (if any). This process is referred to as “Return to Title IV” (R2T4). The calculation of R2T4 has no relationship to the tuition and fees that the student may or may not be charged by Charles and Sue's School of Hair Design. The R2T4 calculation is performed using software provided to the School by the U.S. Department of Education.

R2T4 Calculation Information:

Title IV (federal financial aid) funds are earned in a prorated manner based upon calendar days through the student’s “Withdrawal Date”. After having completed instruction through the 60 percent point in the payment period, a student is considered to have earned 100 percent of the Federal Student Aid funds they were eligible to receive for that payment period.

Percentage Basis for R2T4 Proration:

The percentage of the payment period completed is: the total number of calendar days in the payment period, divided into the number of calendar days (in the payment period) that have passed as of the student’s Last Date of Attendance/Withdrawal Date. (Breaks of five or more days are not considered in the calendar days).

Return of Unearned Funds:

If, based on the calculation, the student has earned less than the amount of Title IV funds disbursed, the unearned funds must be returned. The Financial Aid Office must return the lesser of:

• the amount of federal financial aid funds that the student has not earned, or


• the amount of institutional charges that the student incurred for the payment period multiplied by the percentage of federal financial aid funds that were not earned.

The student (or parent, in the case of a PLUS loan) must return or repay, as appropriate:

• any Federal Direct Student Loan Program or Federal Direct PLUS Loan funds in accordance with the contracted terms of the loan, and


• the remaining unearned federal grant funds (not to exceed 50 percent of the grant owed) as an "overpayment" of the grant (see below).

Refunds are calculated according to applicable federal law and regulation. All returned funds for which the School is responsible will be issued by the Administration Office promptly after the School has determined that the student has withdrawn, and the applicable return calculations have been completed. (Once the Withdrawal Date has been determined, the refunds and R2T4 calculations and all associated transactions are generally completed with thirty calendar days, but never longer than forty-five days).

Overpayments:

Any amount of unearned federal grant funds that a student must return is called an “overpayment”. The maximum amount of a overpayment is one half of the grant funds received or scheduled to be received. While this occurs very rarely, students in this circumstance must make arrangements with the College and/or the U.S. Department of Education to return the unearned grant funds. Failure to do so will result in loss of future eligibility for Federal Student Aid, and potential other legal actions by the U.S. Department of Education.

Financial Aid Programs R2T4 Refund Sequence:

Unearned funds returned by the Financial Aid Office must be credited to outstanding balances on Title IV loans made to the student or on behalf of the student for the payment period for which a return of funds is required. Those funds will be credited to outstanding balances in the following order:

  1. Unsubsidized Federal Direct Stafford Loan,
  2. Subsidized Federal Direct Stafford Loan, and
  3. Federal Direct PLUS Loan received on behalf of the student.

If unearned funds remain to be returned after repayment of all outstanding loan amounts for the payment period, the remaining excess must be credited to any amount awarded for the payment period in the following order:

  1. Federal Pell Grant,
  2. Iraq and Afghanistan Service Grant, and
  3. Federal SEOG.

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