The Higher Education Act of 1965, as amended Oct. 1, 1998, allows institutions participating in any Title IV program (e.g. Pell Grant, Direct Loan Program, etc.) to implement the policy and make a “good faith effort” to enforce it prior to the writing of the final regulations, which became effective on October 7, 2000.
The law focuses on the return of Title IV Funds received for the semester the student was enrolled if that student completely withdraws or partially withdraws (terms with modules) from the College prior to the 60 percent point of the semester.
If a student withdraws after the 60 percent point of the semester or minimester, the student will be considered to have earned all funds disbursed and no return of funds will be required unless a student had received a loan that was subject to repayment under the terms of the loan.
Any student who decides to completely withdraw, or stop attending classes at the College prior to the 60 percent point of the semester and who has been disbursed Title IV funds may be required to repay a portion of those funds to the Department of Education and/or the College based on the federal calculation.