Return of Title IV, Higher Education Act (HEA) Policy

The Higher Education Amendments of 1998, as well as the Program Integrity Regulations in 2010, established provisions which may require a certain percentage of Federal financial aid (Title IV funds) to be returned to the Department of Education when a student completely withdraws from
all classes.

When a student applies for financial aid, the student agrees that financial aid funds will be used for educational purposes only.  Therefore, if a student withdraws before completing their program, Oakland Community College (OCC) is required to calculate the amount of financial aid to be returned to the Title IV, HEA programs according to the regulations.

What is Title IV Aid

Title IV of the Higher Education Act of 1965, as amended in 1998, (Title IV, and HEA program) establishes general rules that apply to federal student financial assistance programs. For purposes of Return of Title IV Funds, these programs include:

  • Federal Pell
  • Federal Supplemental Educational Opportunity (FSEOG) Grants
  • Direct Loans (subsidized and unsubsidized)
  • Direct PLUS Loans, and
  • Perkins Loans

Calculating Return of Title IV Aid Amount

Return of Title IV Funds (Earned vs Unearned Aid)

OCC must calculate the amount of financial aid student earned prior to the date the action was filed. Any aid received in excess of the earned amount is considered unearned. The unearned financial aid must be returned to the respective federal programs no later than 45 days from when it is determined that the student separated from OCC. The calculation is based upon only the amount of Title IV Aid the student was eligible to receive.  

Financial aid will be returned to the aid program from which it came. If returned to a loan program, the outstanding balance will be reduced by the amount of the return. Aid will be returned in the following order:

  1. Unsubsidized Direct Loan
  2. Subsidized Direct Loan
  3. Direct PLUS Loans
  4. Federal Pell Grants
  5. Federal Supplemental Educational Opportunity Grant
  6. Iraq and Afghanistan Service Grant

What Return of Title IV Funds Means to Financial Aid Recipients

If student cancels registration prior to the first day of classes, this policy will not apply to the student. Also, if student drops some but not all of his/her classes, these policies will not apply.

For the student who must cease attendance, the classes can be dropped online through MYOCC account or complete the “Course Drop Request” form and submit it to Enrollment Services.  However, student should notify Student Financial Resources and

Satisfactory Academic Progress  

When a student stops attending school and/or never attends classes, it may affect a student’s academic progress standing and future eligibility for financial aid.  

Future Aid Eligibility

Student loans go into repayment six months after ceasing attendance or graduation.  Student must make payments on time or seek assistance from the loan servicer to prevent default. If a student defaults on a loan, the student may lose eligibility for future financial aid.