Financial Aid Refund Policy
Reed’s policy regarding refunds for students who withdraw before the end of a semester is provided in here.
A student may find it necessary to withdraw from all classes during a semester. If the student received financial aid, Reed College and or the student, may be required to return all or a portion of their financial aid to Reed College, the federal/state government, or both.
The student is encouraged to contact the financial aid or business office and their academic advisor so their decision will be based on a clear understanding of the consequences of withdrawing from all classes.
The withdrawal date is the date that the student initiated a leave or withdrawal via IRIS or otherwise informed a college official they will be withdrawing from all classes. This date is stored with the Registrar’s office and is used to recalculate financial aid eligibility.
If the student does not formally withdraw but stops attending classes and does not successfully complete any credits, Reed will calculate their financial aid earned based on their last date of class attendance as determined by their instructor and bill the student for the unearned portion of the financial aid they received
Federal Financial Aid Refund Policy
Federal Title IV funds are awarded to a student under the assumption that the student will attend school for the entire period for which the assistance is awarded. When a student withdraws, the student may no longer be eligible for the full amount of Title IV funds they were originally scheduled to receive.
Return of Federal Title IV Funds:
The federal formula requires a return of Title IV financial aid if the student:
- received federal assistance in the form of a Federal Pell Grant; Federal Supplemental Educational Opportunity Grant (FSEOG); Loan; Federal Direct Loan (subsidized or unsubsidized); PLUS (parent) loan;
- withdrew on or before completing 60 percent of the semester, the federal government mandates that the student may only keep the financial aid that they have earned up to the time they withdraw from all classes.
To determine the amount of federal aid earned up to the time of withdrawal, the total number of calendar days the student attended classes will be divided by the total number of calendar days in the semester (less any scheduled break of five days or more). The resulting percentage is then multiplied by the total federal funds that were accepted/disbursed. This calculation determines the amount of aid that the student earned and is allowed to keep.
The unearned portion of the aid must be returned to the Federal Title IV program from which the aid was received by Reed and/or by the student. Notice will be emailed to the student’s Reed College email address if their financial aid is reduced and a return is required. If Reed is required to return any Title IV funds, the change will be reflected on the student account.
The student is responsible for the difference between the amount of unearned aid and the amount returned by Reed. If the student's portion of the unearned aid includes federal grants, they are only required to return the grant amount that exceeds 50% of the original amount received for that semester. If the amount the student owes is less than 50%, then no payment is required. Reed will return grant funds on the student's behalf and bill the student accordingly. The student's share of loan funds to be returned may be repaid in accordance with the terms of the master promissory note.
Financial aid returned by the student and/or their parent or the college must be allocated in the following order:
- Federal Direct Unsubsidized Loan
- Federal Direct Subsidized Loan
- Federal Direct PLUS Parent Loan
- Federal Pell Grant
- Federal Supplemental Educational Opportunity Grant (FSEOG)
- Iraq and Afghanistan Service Grant, for which a return of Title IV funds is required.
If, at the time of withdrawal, a student had not yet received all of their earned funds, they may be due a post-withdrawal disbursement. If the post-withdrawal disbursement includes loan funds, Reed will obtain the student’s permission before disbursing them to their student account. The student may choose to decline some or all of the loan funds to reduce their loan debt. Reed may automatically use all or a portion of the post-withdrawal disbursement of grant funds for tuition, fees, and room and board charges (as contracted with the school). Reed will obtain the student’s permission to use the post-withdrawal grant disbursement for all other institutional charges.
The following rules apply when a school is completing a Return to Title IV calculation for a student:
- A school must return any unearned Title IV funds it is responsible for returning as soon as possible after the determination date but no later than 45 days after the date the school determined the student withdrew and offer any post-withdrawal disbursement of loan funds as soon as possible after the determination date but no later than 30 days after that date.
- A school must disburse any Title IV grant funds a student is due as part of a post-withdrawal disbursement as soon as possible after the determination date but no later than 45 days after the date the school determined the student withdrew and disburse any loan funds a student accepts as soon as possible after the determination date but no later than 180 days after that date.
- Unless a student subject to verification has provided all required verification documents in time for the school to meet the return deadlines, the school includes as Aid Disbursed or Aid That Could Have Been Disbursed in the Return calculation only those Title IV funds not subject to verification.
- If a student who failed to provide all required verification documents in time for the school to meet the return deadline later provides those documents prior to the applicable verification deadline, the school must perform a new return calculation on all of the aid the student qualified for based on the completed verification documents and make the appropriate adjustments.