Is a Student a Withdrawal If She Completes All Clock Hours Early Without Completing All Scheduled Weeks Of Instruction?

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The following guidance applies only to the return of Title IV funds (R2T4) rules that are effective July 1, 2021 (with possible early implementation by the school), in accordance with the September 2, 2020 Federal Register.

No, according to guidance NASFAA has received from the U.S. Department of Education (ED).

Under the R2T4 regulations effective July 1, 2021, if the student completes all the requirements for graduation before completing all of the clock-hours or days in the payment period or period of enrollment, the student is not considered to have withdrawn and is exempt from the R2T4 calculation. However, if a clock-hour student graduates without successfully completing all of the established clock hours in the program, the school must re-prorate the amount of Title IV aid and only pay the student for the clock hours the student successfully completed.

Per ED, if a student successfully completes all clock hours within a program before the normal number of weeks have elapsed, the student is not considered a withdrawn student and no proration (or re-proration) of Title IV aid has to occur. This is due to the fact that students progress individually through clock-hour programs and though an overall program length in weeks that is reported to ED. Those weeks are an estimate of how long it normally takes the majority of the school's full-time students to complete the program of study. Therefore, it is not uncommon to have some students complete a program a little earlier or later than the reported number of weeks have elapsed. However, the number of clock hours that make up a program of study are static for all students and do not change. The re-proration requirement is only for situations where the student completed a program without successfully completing all of the established hours in the program (not the weeks).

Of course, if a majority of students are completing the program in less weeks than reported to ED on the E-App, then the school will need to review and adjust the number of weeks it normally takes the majority of their full-time students to complete the program of study. And just as a reminder, if a student successfully completes all of the hours in the program before completing a sufficient number of weeks to enter the final payment period, the student will not qualify for any final Title IV disbursements.

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AskRegs Q&As represent NASFAA's understanding of regulatory and compliance issues. They are FOR INTERNAL USE ONLY. While NASFAA believes AskRegs Q&As are accurate and factual, they have not been reviewed or approved by the U.S. Department of Education (ED). If you should need written confirmation of AskRegs information for audit or program review purposes, please contact your ED School Participation Division. NASFAA shall not be liable for technical or editorial errors or omissions contained herein; nor for incidental or consequential damages resulting from the furnishing, performance, or use of this material.