Return of Title IV Funds (R2T4)

If you withdraw from all classes before completing a semester, your federal financial aid may need to be recalculated.
Federal law requires colleges to determine how much financial aid you earned based on how long you attended your classes.
This process is called Return of Title IV Funds (R2T4).

What Happens if I Withdraw?

When a student withdraws from all classes, the Financial Aid Office must calculate how much federal aid the student
earned during the semester. Financial aid is earned based on the percentage of the semester completed.

  • If you complete 60% or more of the semester, you earn 100% of your federal financial aid.
  • If you withdraw before completing 60%, a portion of your financial aid may need to be returned to the U.S. Department of Education.

How the Calculation Works

The Return of Title IV calculation determines:

  • Total federal financial aid disbursed to you
  • The percentage of the semester you completed
  • The amount of aid you earned
  • The amount of aid that must be returned

This calculation is required by federal regulation and applies to the following programs:

  • Federal Pell Grant
  • Federal Supplemental Educational Opportunity Grant (FSEOG)
  • Federal Direct Subsidized Loans
  • Federal Direct Unsubsidized Loans

What This Means for Your Student Account

If financial aid must be returned, your student account may show a balance due.
This happens because tuition and fees that were originally paid with financial aid must be repaid to the federal government.

The college is required to return funds in the following order:

  1. Direct Unsubsidized Loan
  2. Direct Subsidized Loan
  3. Pell Grant
  4. FSEOG

Grant Overpayments

In some cases, withdrawing from classes may result in a federal grant overpayment.
If this happens:

  • You are responsible for repaying the overpayment amount.
  • You must resolve the overpayment within 45 days.
  • If the overpayment is not resolved, it will be referred to the U.S. Department of Education for collection.
  • You will become ineligible for additional federal financial aid until the overpayment is resolved.

Post-Withdrawal Disbursements

In some situations, students may have earned financial aid that was not yet disbursed before they withdrew.
This is called a Post-Withdrawal Disbursement.

  • Grant funds may be applied to your student account.
  • Loan funds require your authorization before they can be disbursed.
  • You will be sent a separate notification, if applicable.

State Financial Aid (Cal Grant)

State financial aid programs such as the Cal Grant are not included in the federal Return of Title IV calculation.
Cal Grant awards will be adjusted based on enrollment and attendance requirements like federal student aid adjustments under R2T4 requirements, when applicable.

How to Avoid Owing Money

  • Speak with a counselor before withdrawing from classes.
  • Contact the Financial Aid Office to understand how your aid may be affected.
  • Consider reducing units instead of withdrawing completely.

Questions?

If you are considering withdrawing or have already withdrawn and have questions about your financial aid, please contact the Financial Aid Office.