Withdrawal from Classes: Return to Title IV

There can be serious consequences for withdrawal from classes

Any student who withdraws or is expelled from all classes during the term, depending upon when this action is taken, may be refunded all or part of their tuition and fee charges. If the student is a financial aid recipient, the University of Michigan-Dearborn, as well as the student, may be required to return to the federal government all or a portion of the aid that had been disbursed to the student and/or the student's account.


Students receiving financial aid have the responsibility to follow the college's withdrawal procedures as outlined in the University of Michigan-Dearborn University catalog.  The Higher Education Act requires the University to calculate a Return of Title IV Funds on all federal financial aid students who withdraw (officially or unofficially) from all classes. A schedule is used to determine the percentage of the semester the student attended based on the withdrawal date/last date of attendance.  The percentage of the semester the student attended is calculated as follows:  

                                            Number of days in attendance
                                     Number of days in period of enrollment

The number of days counted includes all calendar days in the period of enrollment including weekends and holidays, but excludes college breaks of five or more days.  The percentage of the period of enrollment the student attended is used to calculate the amount of the student's earned versus unearned federal aid funds. The unearned portion of the federal aid funds must be returned to the appropriate aid program in accordance with the order of return as mandated by law.

The order of return is:    

1. Federal Unsubsidized Direct Loan
2. Federal Subsidized Direct Loan
3. Federal Perkins Loan
4. Federal Direct PLUS (Parent) Loan  
5. Federal Pell Grants    
6. Federal Supplemental Opportunity Grants (FSEOG) 
7. TEACH Grants   
8. Iraq and Afghanistan Service Grant

The University is responsible to return the lesser of unearned Title IV aid or unearned institutional charges.  Unearned institutional charges are based on the percentage of the semester the student did not attend.  The college is responsible for its return of funds first, followed by the student's return of funds.  The student is responsible for returning:

                                           Amount of unearned Title IV Aid
                                       -  Amount of aid the school returns
                                               Amount student returns

If the student did not receive all of the funds that they earned according to the calculation, they may be due a post-withdrawal disbursement.  If the post-withdrawal disbursement includes loan funds, the University must get authorization from the student within 14 days before it can disburse the funds.  

A student may choose to decline some or all of the loan funds so they do not incur additional debt.  The University may automatically apply all or a portion of the post-withdrawal disbursement of grant funds to any outstanding tuition and fees.

The University must return its portion of unearned Title IV Aid (loan and grant) to the appropriate federal program within 45 days from the student's withdrawal date as determined by the Office of Financial Aid and Scholarships.  If the amount the student returns includes a federal loan program, the student is responsible for repayment of the loan in accordance with the terms of the loan program.

If the amount the student returns includes grant aid, the student must repay 50% of the grant received, rather than 100%.  The student must return unearned grant aid to the college within 30 days to avoid late assessments. Students who have been reported to the U.S. Department of Education by another institution for an overpayment status should contact the U.S. Department of Education to make payment arrangements to repay the necessary grant funds.

Students who stop attending the University of Michigan-Dearborn may not receive further financial aid disbursements, may lose some or all of the aid that has already been disbursed to their account, may be responsible for repayment of unpaid charges, and may be considered in overpayment status with the U.S. Department of Education.

Students who stop attending all classes without officially withdrawing from the college will be subject to a Return of Title IV Funds calculation at the end of the semester, based on their last date of attendance as determined by faculty.


If it is determined that a student has never attended course(s), a reduction of some or all financial aid may be necessary. At the time the office determines a non-successful grade, faculty will be contacted to confirm a last date of educational activity.  A non-response from faculty requires the Office of Financial Aid & Scholarships to assume the student  has never attended course(s).

Once a determination of earned Federal financial aid, the Office of Financial Aid & Scholarships will notify each affected student of eligibility.

  • Eligible Michigan Competitive Scholarship funds are based on a formula provide by the Michigan Student Scholarships and Grants Office.
  • University funds will be reduced if a refund would be generated from these funds.
  • Loans disbursed in excess of eligibility are due based on terms and conditions outlined in the promissory note(s). Most Direct Loan borrowers will enter repayment six months after withdrawal--unless they begin classes on a half-time basis (6 credits undergraduate/4 credits graduate) before the end of their six-month grace period.

It is important to realize that a key component of satisfactory academic progress is course completion.  A total withdrawal contributes no credits to an academic transcript.  Absence of course completion during a term could be viewed negatively in positive  progress towards degree completion.
Questions and concerns should be directed to the Office of Financial Aid & Scholarships at 313-593-5300.  The Office of Financial Aid & Scholarships encourages all students to meet their academic advisor and to take advantage of the resources in the Student Success Center on the second floor of the University Center. 

Policy owned by: Financial Aid and Scholarships

Last review: 7/2019

Last updated: 7/2019

Next review: 1/2021