[Oasfaa] Current Charges/Crediting a Student's Account

[Matt D. McCoin]

I have a question regarding current charges. We are a non-term program
who awards based upon an award year of 24 hours consisting of 2 payment
periods of 12 hours each. Our format is such that students attend one
course at a time, one night a week for 5 weeks. The charges are placed
on a student's account at the beginning of the month for any class they
begin during that month. This has been the process for a couple of
years. What results from the disbursement is a credit balance that
either has to be returned to the student or it may stay on the student's
account provided an authorization form is signed. Because students
aren't physically in the class when the funds are disbursed these
courses aren't considered allowable charges. We have been told that it
would be against a GAAP rule to charge for these classes at the
beginning of the payment period, and disburse only funds in excess of
these charges. The FSA Handbook states that "Current charges: Charges
assessed by the school for the current award year or the loan period for
which the school certified or originated an FFEL or Direct Loan".
"Allowable charges include: current charges for tuition and fees as
defined in section 472 of the HEA". So it appears that our tuition
charges are allowable charges and they can be considered current charges
because they are for the current award year. Does any one have any
insight into this problem? I know most of you are term based
institutions who place an entire semester's charges on account up front,
but I think if I read this rule right this would be the equivalent of
placing charges for fall and spring semesters on the account in the
fall. (assuming you could enroll in both semesters at once). Does this
make sense or am I reasoning myself in a winding circle of confusion. 

 

The reason I bring this up this. We have had several students who won't
sign the authorization to retain funds form and we have only had one
charge on their account for the current month's class. They are
receiving a huge credit balance refund. They subsequently withdraw from
the program without completing the first course. We have been stuck
sending money back to lender, as a result of the r2t4, that isn't on the
student's account. I think word is spreading among the people who have
done this and we have seen an increased amount of this activity. Any
help you could provide would be greatly appreciated. 

 

Matt McCoin

Coordinator of Financial Aid

St. Gregory's University-College for Working Adults

(918) 610-8888

FAFSA School Code: 003183

 

 

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