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  1. #1

    Default Financial Aid Refund Money

    My question involves education law in the State of: Missouri.

    This is my first post so sorry if I leave out some info you need. Just ask and I'll get it for you. Thanks.

    So here's the situation. I received a financial aid refund check but I wanted to find out what I could use it for. I assumed it was for education related uses only, but I asked the financial aid center at my school anyway. Well, they said that there were in fact no restrictions on its use. I was surprised by this; I had to find out for sure that the school could legally make any authorization on the use of refund check and in fact the Dept. of Education had nothing to do with it, so I emailed the Dept. of Education. They wouldn't answer for anything. I emailed and called many times. I won't bore you with the details but most of them didn't even know as much as me. One important thing is that I was given a list of uses of appropriate financial aid included in my MPN, but I was told by the fin. aid dept. at my school that this list did not refer to refund check.

    I can't find anyone who knows. Were does it state colleges control the use of refund checks, as in make the authorizations on its use. I ask because I think my college is giving me incorrect info because it seems to contradict the MPN, but I'm not sure I properly understand the MPN anyway.

    Thanks to all who reply.

  2. #2
    Join Date
    Sep 2005
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    Default Re: Financial Aid Refund Money

    I'm not aware of any restrictions of your use of a financial aid refund check - your award in excess of tuition, fees, books, and other costs of attendance - with the caveat that if you change your enrollment status (such as by dropping some classes) you may trigger a requirement to repay part or all of your financial aid (not just the refund) to the aid program.

  3. #3

    Default Re: Financial Aid Refund Money

    So is it your understanding that refund checks are separate from normal financial aid? As in the laws or rules governing financial aid are separate from the laws/ rules governing refund money?

    It seems to be this excepted thing that refund money is the concern of the school and there is no restrictions on its use, but I can't find where it is written.

    I'm mainly trying to find out where it is written or at least someone has read this and can confirm it as the truth. Any resource where I might find more answers would be helpful as well, so anyone reading, please send that over.

    Thanks

  4. #4
    Join Date
    Oct 2009
    Posts
    28

    Default Re: Financial Aid Refund Money

    You can use your refund in any way you want. I had waaaaaay more in scholarships than my tuition and books came to when I was in college and wondered the same thing. The refund is yours to do with as you please. Basically, they understand that part of going to college is needing a roof over your head, needing clothes, needing food, etc. Nobody is going to come to you and ask you what you spent it on, I can assure you of this as someone who has had financial aid refunds for all 4-years of my undergrad and both years of my master's degree. I wish I could point to something in writing to assure you of this, but I can't. I just know from my experiences, from my husband's experiences, and those of my friends and family. I hope this helps.

  5. #5
    Join Date
    Jan 2008
    Posts
    1,948

    Thumbs up Re: Financial Aid Refund Money

    I agree with the other replies. Remember that your grants/financial aid package is also taking into consideration the cost of living (on or off campus, food, and transportation). At my school they take out the cost of tuition and fees from your package, the rest is directly deposited into the bank of your choice - for you to buy your books and then live as you see fit.

  6. #6

    Default Re: Financial Aid Refund Money

    Thank you two for your comments.

    Yes, I've heard this (even from my financial aid office), but I've read at least a third of the Higher Education Act of 1965 with all current amendments, and (from what I've read and understood so far) it suggests that simply doing what you want with refunds is illegal. I don't know this for sure because it doesn't outright say it. The section covering disbursement of funds states all remaining funds after the school has made all authorized charges must be returned to the borrower, but it stops there. No distinction between normal funds and refund money. The only place I found mention of use of financial aid was in the section on calculating the cost of attendance. The only thing where appropriate use was to be determined by the student was for the allowance for personal expenses (did not outright say this but suggested it). Everything else was to be determined by the government or the institution and only involved educational expenses.

    The reason I'm not sure what can legally done with refund money is because of the fact I can't find anything that specifically refers to refund money other then the previously mentioned section that acknowledges its existence. It is extra difficult to find something because of the constant mention of refunds and the return of funds from withdrawal as well.

  7. #7
    Join Date
    Jan 2008
    Posts
    1,948

    Cool Re: Financial Aid Refund Money

    I scoured my university's website... info is cut and pasted below.

    "Financial aid awards are disbursed twice during the year: the fall and spring semesters.

    Disbursements continue throughout the semester as new awards are processed or changes to awards occur.

    Students are encouraged to complete the application process early and to sign up online for eRefund (direct deposit) at Student Financial Services.

    Conditions For Disbursement
    Before the Office of Financial Aid and Scholarships (OFAS) sends your record to University Disbursements to release award funds, the following conditions must be met—

    You must be awarded financial aid
    All financial aid holds must be cleared
    You must be enrolled in at least 6 units
    When the above conditions are met, the OFAS forwards your record to University Disbursements.

    If any registration fee and/or housing payment postponements were applied to your account, the amounts will be deducted from the award amount.

    After all charges and fees have been subtracted from the award, the remaining amount is referred to as a “refund” on your account through Student Account Services."

    They say nothing about how this "refund" may or may not be used.
    Your school's website should have similar information.

  8. #8

    Default Re: Financial Aid Refund Money

    Yes my school's website has similar info, but I don't want to assume this is legal because nothing says otherwise (I know what your thinking, "This guy isn't helping"). Still, I have heard that ignorance of the law is not a legitimate defense. I don't want to inadvertently break the law by misusing the money.

    Thanks for your time and help.

  9. #9
    Join Date
    Jan 2010
    Posts
    3

    Default Re: Financial Aid Refund Money

    There is nothing in writing that says what you should do with a refund. Most people use it for any and all extended expenses for their education, including living expenses. The disbursement clauses may be aimed at the people that disburse it I suppose, not the people that recieve it. This is just a guess.

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