Financial Aid Refunds/Federal Return of Title IV Funds (R2T4)

The law specifies how GIA must determine the amount of Title IV program assistance a student earns if they withdraw from school. The Title IV programs that are covered by this law are: Federal Pell Grants, Federal Supplemental Educational Opportunity Grants (FSEOG), Direct Loans, and Direct PLUS Loans.

Although a student’s aid is posted to their student account at the start of each payment period, a student earns the funds as they complete the period. If a student withdraws during a payment period or period of enrollment, the amount of Title IV program assistance that the student has earned up to that point is determined by a specific formula. If a student received (or GIA or a parent received on the student’s behalf) less assistance than the amount that the student earned, the student may be able to receive those additional funds. If the student received more assistance than they earned, the excess funds must be returned by GIA and/or the student.

The amount of assistance a student has earned is determined based on the US Department of Education’s return to title IV formula. For example, if a student completed 30% of their payment period or period of enrollment, the student earned 30% of the assistance they were originally scheduled to receive. Once the student has completed more than 60% of the payment period or period of enrollment, the student has earned all the assistance that they were scheduled to receive.

Title IV return of funds are repaid in the following order:

  1. Unsubsidized Direct Loan
  2. Subsidized Direct Loan
  3. Direct Parent PLUS Loan
  4. Pell Grant
  5. Federal Supplemental Educational Opportunity Grant (FSEOG)

If a student did not receive all of the funds that they earned, the student may be due a post-withdrawal disbursement. If a student’s post-withdrawal disbursement includes loan funds, GIA must get the student’s permission before it can disburse them. The student may choose to decline some or all of the loan funds so they do not incur additional debt. GIA may automatically use all or a portion of the student’s post-withdrawal disbursement of grant funds for tuition and fees. GIA needs the student’s permission to use the post-withdrawal grant disbursement for all other school charges. If a student does not give their permission, the student will be offered the funds. It may be in the student’s best interest to allow GIA to keep the funds to reduce the student’s debt at GIA.

Student who have not completed the first 30 days of their program before they withdraw, will not receive any Direct Loan funds they would have received had they remained enrolled past the 30th day.

If the student receives (or GIA or the student’s parent receives on the student’s behalf) excess Title IV program funds that must be returned, GIA must return a portion of the excess equal to the lesser of: The student’s institutional charges multiplied by the unearned percentage of their funds, or the entire amount of excess funds.

GIA must return this amount even if it did not keep this amount of the student's Title IV program funds. If GIA is not required to return all of the excess funds, the student must return the remaining amount.

Any loan funds that the student must return, they (or parent for a Direct Parent PLUS Loan) repays in accordance with the terms of their repayment plan.

Any amount of unearned grant funds that the student must return is called an overpayment. The maximum amount of a grant overpayment that the student must repay is half of the grant funds the student received or was scheduled to receive. They do not have to repay a grant overpayment if the original amount of the overpayment is $50 or less. They must make arrangements with GIA or the Department of Education to return the unearned grant funds.

The requirements for Title IV program funds when a student withdraws are separate from any refund policy that GIA may have. A student may still owe funds to the school to cover unpaid institutional charges. GIA may also charge a student for any Title IV program funds that the school was required to return. GIA can also provide students with the requirements and procedures for officially withdrawing from school.

For general questions about Title IV program funds, visit  or call the Federal Student Aid Information Center at 1-800-4-FEDAID (1-800-433-3243). TTY users may call 1-800-730-8913.