Return of Title IV Funds Policy

This policy applies to all students at Dallas Baptist University receiving Federal Financial Aid. The federal government mandates that students who withdraw or fail to complete all classes within a term of enrollment may only keep the financial aid they have “earned” up to the time of withdrawal. Any unearned aid must be returned to the appropriate program even if it has already been disbursed. These requirements do not apply to a student who does not actually begin attendance or cease attendance at the school. For example, when a student reduces their course load from 12 credits to 9 credits, the reduction represents a change in enrollment status/intensity, not a withdrawal.

Policy

Federal regulations require that Title IV financial aid funds be awarded and disbursed under the assumption that the student will attend the institution for the entire period in which federal assistance was provided. When a student withdraws from all courses for any reason, the student may no longer be eligible for the full amount of Title IV funds that the student was originally scheduled to receive. The return of funds is based on the premise that students earn their financial aid in proportion to the amount of time in which they are enrolled. A prorated schedule is used to determine the amount of federal aid the student will have earned at the time of the withdrawal.

Please Note:

Any time a student begins attendance in at least one course but does not begin attendance in all the courses the student was scheduled to attend, regardless of whether the student is a withdrawal, the school must determine if it is necessary to recalculate the student’s eligibility for Pell Grant and Campus-Based funds based on a revised enrollment status/intensity and cost of education. If the student is a withdrawal, this recalculation must be done before performing an R2T4 calculation, and the school must use the recalculated amounts of aid in the R2T4 calculation.
Institutional funds are not subject to the R2T4 policy and will follow DBU guidelines, however, if a student withdraws before financial aid is disbursed/transmitted, DBU performs an R2T4 for Federal Aid, and the student is not eligible for any state or institutional aid.
If a student withdraws from all courses after the 60th percentile of the payment period, they are considered to have earned 100% of aid, and the Return of Title IV refund calculation is not required.
Prior to completing the Return of Title IV Funds calculation, DBU will evaluate student eligibility for a post-withdrawal disbursement, and if eligible, the post-withdrawal disbursement will be made.

The R2T4 calculation must be completed if a student receives federal funds and:

completely withdraws prior to the 60th percentile of the payment period, or
does not complete all modules (courses that are not scheduled for the entire payment period), or
stops attending before completing the payment period.

How Earned Financial Aid is Calculated

Students receiving federal financial aid must “earn” the aid they receive by enrolling and participating in classes. The amount of federal financial aid assistance the student earns is on a prorated basis. Students who withdraw or do not complete all registered classes during the payment term may be required to return some of the federal financial aid they received.

When a student completely withdraws, DBU is required to determine the percentage of Title IV aid ‘’earned” by the student and to return the unearned portion to the appropriate aid programs. Regulations require schools to perform calculations within 30 days from the date the school determines a student’s complete withdrawal. The school must return the funds within 45 days of the calculation. The R2T4 calculation process and return of funds are completed by designated staff within the Financial Aid Office.

The following R2T4 formula is used to determine the percentage of unearned aid that must be returned to the federal government:

The percentage of earned aid is equal to the number of calendar days completed up to the withdrawal date, divided by the total calendar days in the payment period (less any scheduled breaks that are at least 5 days long).
The payment period for most students is the time frame for which federal funds were provided to the student. However, for students enrolled in modules (courses which are not scheduled for the entire semester or term), the payment period only includes those days for the module(s) in which the student is registered.
The percent of unearned aid is equal to 100 percent minus the percent earned.

How R2T4 is Calculated for Module Courses

A student is considered withdrawn if the student does not complete all the days in the payment period that the student was scheduled to complete. For students enrolled in modules (courses that are not scheduled for the entire semester or term), the payment period includes only those days for the module(s) in which the student is registered.

If a student officially/unofficially drops courses in a later module while still attending a current module, the student is not considered as withdrawn based on not attending the later module. However, a recalculation of aid based on a change in enrollment status may still be required.

For students enrolled in multiple module courses per term and who do not return for the later module in the same payment period or term, DBU considers it to have been withdrawn and begins the R2T4 process immediately.
However, if the student does return to their program in the same term, DBU will not consider the student to have withdrawn and is eligible to receive the Title IV funds for which the student was eligible.

Financial Aid will monitor those students enrolled in multiple module courses and then reverse the R2T4 process and provide additional funds that the student is eligible to receive at the time of return.

Withdrawal Exceptions

A student who meets one of several R2T4 withdrawal exemptions would also not be considered a withdrawal. If met, these withdrawal exemptions allow a student who has otherwise withdrawn or left the institution to not be considered a withdrawal for Title IV purposes.

Withdrawal exception for graduates/completers - A student who completes all the requirements for graduation from their program before completing the days or hours in the period that they were scheduled to complete is not considered to have withdrawn. This exemption applies to all types of programs (including those with or without modules)
Withdrawal exemptions for programs offered in modules -The withdrawal exemptions for successful completion of a module or a combination of modules that cumulatively contain 49% or more of the number of days in the payment period (excluding scheduled breaks of five or more consecutive days and all days between modules) and for successful completion of coursework equal to or greater than the coursework required for the institution’s definition of a half-time student in the payment period, only apply to programs using modules.
Written Confirmation of Future Attendance Exemption - Standard Term & Non-Standard Term: Return to the same period within 45 calendar days after the end of the module from which the student ceased attending.
Treating students as if they never began attendance – The school my use this exemption if the student is treated as never beginning attendance, all Title IV aid is returned, all institutional charges for the payment period or period of enrollment are refunded, and any balance remaining for the payment period of enrollment for students who withdraw are written off. (New regulations, effective July 1, 2026, have been released with some aspects which schools may opt to early implement starting on February 3, 2025.)

Determining the Withdrawal Date

For an official withdrawal, the effective withdrawal date is the first date of notification by the student to their DBU academic advisor or Registrar’s Office. DBU may utilize the last date of attendance for the effective withdrawal date if the last date a student attended class or submitted coursework can be verified, or in case of an emergency situation, and there is third-party documentation that verifies a student has not attended class. A student's self-reported last date of attendance is not considered suitable for determining the withdrawal date.

For an unofficial withdrawal, the withdrawal date will be when the institution becomes aware that the student is no longer attending the institution.

For an unofficial withdrawal, due to the student failing all classes, the effective withdrawal date is the midpoint of the term if there is no last date of attendance reported by instructors.
For students who are academically dismissed, this is the date of their dismissal notification.

DBU may use a last date of attendance for the effective withdrawal date if the last date a student attended class or submitted coursework is verified by an employee who has knowledge of a student's class attendance or if there is an emergency situation and there is third-party documentation that verifies a student has not attended class.

Students are strongly advised to meet with a member of the Financial Aid Office to discuss the financial consequences of withdrawing from DBU before doing so.

Student Responsibilities

Students must follow the official withdrawal process by contacting their academic advisor or the Registrar’s Office.

Any student receiving Title IV financial aid is advised to speak with a financial aid officer prior to withdrawing from the University.

Any student who receives a student loan must complete loan exit counseling upon withdrawing from the University or dropping below half-time enrollment. Loan exit counseling can be completed on the internet at Complete loan exit counseling >>

Loans must be repaid by the loan borrower as outlined in the terms of the borrower's promissory note. The grace period for loan repayments for Federal Unsubsidized or Subsidized Direct Loans will begin on the day of the withdrawal from DBU. The student should contact their loan servicer if the student has questions regarding the grace period or repayment status.

Returning Unearned Funds & Priority Order

The University is required by federal statute to determine what portion, if any, of that student’s financial aid is to be refunded to the financial aid program(s) in which that student participated.  Priority order for the return of federal funds is:

Unsubsidized Federal Direct Loan
Subsidized Federal Direct Loan
Federal Direct Graduate PLUS Loan
Federal Direct Parent PLUS Loan
Federal Pell Grant
Federal Supplemental Educational Opportunity Grant (SEOG)

If a student leaves the institution having completed less than 60% of a payment period or term, the financial aid office recalculates eligibility for Title IV funds. Recalculation is based on the percentage of earned aid using the following Federal Return of Title IV funds formula:

Percentage of payment period or term completed = the number of days completed up to the withdrawal date divided by the total days in the payment period or term. (Any break of five days or more is not counted as part of the days in the term.) This percentage is also the percentage of aid earned.
Funds are returned to the appropriate federal program based on the percentage of unearned aid using the following formula:
Aid to be returned = (100% of the aid that could be disbursed minus the percentage of earned aid) multiplied by the total amount of aid that could have been disbursed during the payment period or term.
A student has “earned” 100% of his/her Title IV funds at the 60% point in the term.

A student has “earned” 100% of his/her Title IV funds at the 60% point in the term.

Unfunded institutional awards will be prorated by the same amount as tuition for the first 24 days of the enrollment period.
TEG Withdrawal and Enrollment Clarification
In accordance with institutional and state guidelines, the following clarifications apply to Texas Equalization Grant (TEG) eligibility and adjustments in the event of student withdrawal:
- Complete Removal of TEG: If a student was not enrolled in any credit hours during the payment period, TEG funding will be completely removed for that period.
- Minimum Enrollment Requirement on Disbursement Day: On the official disbursement day of each payment period, the student must be enrolled in at least 9 credit hours to maintain eligibility for TEG. Failure to meet this enrollment requirement will result in the cancellation of the award for that period.
- Return to Title IV (R2T4) Impact: In instances where a student withdraws and triggers a Return to Title IV (R2T4) calculation, TEG will be prorated in alignment with Dallas Baptist University’s institutional refund policy.
After the first 24 days, a student earns 100% of their unfunded institutional award amounts since tuition is retained at 100%. However, a student cannot receive a credit refund as a result of institutional aid after a withdrawal has been processed.
Also, a refund may occur when eligible federal aid is due in the term but has not been disbursed to the student account at the time of withdrawal.  This allows for payment of classes in which no credit is received.  However, a withdrawing student’s remaining aid may not create a credit balance from institutional awards during the refund periods.
Further, awarding professors may wish to redistribute departmental scholarships to other students, in which case the award may be reversed in the withdrawing student’s account. This action is not a prerogative of the financial aid office.

Students can see the DBU Refund Policy on the Cashier’s webpage under Refund Policy.

Student Responsibilities

Any student receiving Title IV financial aid is advised to speak with a financial aid officer when attempting to withdraw from the University.  This is to ensure that the correct amount owed to each financial aid program is determined and returned as soon as possible.

Any student who receives a federal student loan must complete loan exit counseling upon withdrawing from the University.  Due to this requirement DBU will hold a student’s transcripts and all other information for release from the University until exit counseling has been confirmed.  Loan exit counseling can be completed on the internet at https://studentaid.gov/exit-counseling/

NOTE: The requirements for return of Title IV program funds when student withdraws are separate from the institutional refund policies.

Overpayment Resolution and Outstanding Balances

DBU will return funds on behalf of a student who owes a Title IV grant overpayment and consider the returned funds as the student’s debt to the university. The DBU Business Office will determine whether the university will enter into a repayment agreement with the student.

Withdrawals may also affect future financial aid eligibility.

To settle an outstanding balance owed DBU, the student should contact the Cashier’s Office and may select one of the following options to pay the outstanding balance:

Pay entire balance
Make payment arrangements