In accordance with federal law, if a student who is a recipient of Title IV grant and/or loan funds (Federal Pell Grant, Federal Supplemental Educational Opportunity Grant, Federal Perkins Loan, Federal Stafford Loan, Federal PLUS Loan) withdraws during a payment period, Davidson College must determine the amount of Title IV funds the student has earned. That amount is determined by a formula established by federal law.
If a student has received less Title IV funds than the student has earned, the student may receive the additional earned funds. If the student has received more assistance than he or she earned, the excess funds must be returned.
If the student withdraws before completing 60 percent of the payment period, the amount of assistance that a student has earned is determined on a pro-rata basis. For example, if a student completes 30 percent of the payment period, the student has earned 30 percent of the assistance he or she originally was scheduled to receive. Once a student completes more than 60 percent of the payment period, the student has earned all of the assistance.
If a student has received excess funds, Davidson College must return a portion of those funds equal to the lesser of (1) the institutional charges multiplied by the unearned percentage of the student’s funds, or (2) the entire amount of the excess funds. After Davidson has allocated the funds for which it is responsible, the student must return the remaining amount.
Unearned Title IV funds returned by the institution and/or student must be returned in the following order: Unsubsidized Federal Stafford loans, Subsidized Federal Stafford loans, Federal Perkins loans, Federal PLUS loans received on behalf of the student, Federal Pell Grants, Federal Supplemental Educational Opportunity grants, other grant or loan assistance authorized by Title IV.
Detailed rules and laws related to these calculations are available upon request from the Office of Admission and Financial Aid.