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Withdrawal Policy

For students who did not receive any federal aid and are withdrawing please see link at the bottom of this page for the official Luther Seminary refund policy.

Withdrawal Policy for Federal Aid Recipients

If you have received federal student aid and complete a total withdrawal prior to the end of a term your current (and future) financial aid could be affected.

What effects does a withdrawal have on financial aid?

When a student is awarded and receives federal aid it is assumed that he/she will complete all of the courses registered for in a given term. When a student completes a total withdrawal from all courses for any reason she/he may no longer be eligible for the full amount of federal aid that he/she was originally awarded. Also, if a student does not complete all courses attempted he/she may be responsible for repaying a portion of their federal aid back to the U.S. Department of Education.

If you have any questions about the following policy please feel free to contact the Office of Financial Aid at finaid@luthersem.edu

Calculating Earned Financial Aid

The amount of earned financial aid is calculated on a daily basis from the first day of classes. The process uses calendar rather than business days. Earned aid is determined by taking the number of days attended before enrollment ended divided by the total number of days in the term (first day of instruction until the last day of finals, excluding breaks of 5 or more days.)

Students who withdraw on or before the 60% point of the term will be subject to this return policy. Once 60% of the term is completed, a student is considered to have earned 100% of their aid and will not be required to return any federal funds. However, a school must still complete a return calculation to determine whether the student is eligible for a post-withdrawal disbursement (see below for an explanation).

Return of Federal Funds

Within 45 days from when you discontinue enrollment, Office of Financial Aid will calculate the amount of financial aid you have earned prior to the date the action was filed. Any aid received in excess of the earned amount is considered unearned. The unearned financial aid must be returned to the respective federal programs no later than 45 days from when the student separated from Luther Seminary. The calculation is based upon only the amount of federal aid for which you were eligible.

Post-Withdrawal Disbursement

An evaluation will be done to determine if aid was eligible to be disbursed but had not disbursed as of the withdrawal date. If the student meets the federal criteria for a post withdrawal disbursement, the student will be notified of their eligibility within 30 days of determining the student’s date of withdrawal. After being notified of post-withdrawal disbursement eligibility, students must reply if they wish to accept the post withdrawal disbursement. A post-withdrawal disbursement would first be used toward any outstanding charges for any funds would be returned to the student. If the student does not respond within two weeks of notification the award would be cancelled.

Types of Withdrawals

For financial aid purposes there are two types of withdrawals: Official and Unofficial

Official – leaving the Seminary by dropping all their classes.
Unofficial – receiving non-passing grades in all courses attempted
Non-passing grades are M (marginal), C-, D, F (fail), NR (none reported), NS (not satisfactory), NC (no credit), WF (withdrawal fail), W (withdrawal)

Withdrawal Date

The date of withdrawal if the actual date indicated on the official withdrawal record. For an unofficial withdrawal, the Registrar with query the faculty as to the last date of academic related activity. Academic related activity may include:

  • Exams or quizzes
  • Completion of an assignment, paper or other project
  • Participating in an online discussion group
  • Participating in a study group

In the event that the last date of academic related activity cannot be determined, the 50% point in the term will be used.

Notification of Repayment

If it is determined that a portion of federal aid received is unearned, a letter will detailing the amount returned will be mailed to the student’s current address. The Seminary will return funds on the student behalf and will bill the student’s account. A statement of account will be sent to the student. The student is ultimately responsible for all charges and overpayments resulting from the withdrawal calculation.

Since the only federal aid available are loans, any portion owed by the student must be repaid to the loan holder according to the terms of the original promissory note.

Financial aid will be returned to the program from which it came. Amounts returned to loan programs will reduce your outstanding balance. Aid will be returned in the following order:

  1. Federal Unsubsidized Direct Loan
  2. Federal Perkins Loan
  3. Federal Direct Grad PLUS Loan

Federal Tuition Assistance – Refund Policy

Luther Seminary has signed the Department of Defense (DOD) Voluntary Education Partnership Memorandum of Understanding (MOU) and is approved to process DoD Tuition Assistance (TA) for all of our degree programs.  TA benefits are available to qualifying individuals currently serving in the Armed Forces.  Each service branch has specific TA policies and annual funding limits.  Questions about your own TA eligibility should be directed to your unit or education office.  Some helpful links are below. 

Return of Tuition Assistance (Unearned TA Policy)

Students who use Tuition Assistance (TA) are expected to remain enrolled in the course for its entire duration. If a student using TA withdraws or stops attending, the student may no longer be eligible for the full amount of the benefit that was originally authorized. To remain in compliance with the Department of Defense’s policy, Luther Seminary will return any unearned TA funds through at least 60% mark of the course on a prorated basis. The amount of unearned TA that is returned is based on student-initiated date of withdrawal or last date of attendance noted by the instructor.

After 60% of the course has passed, TA will not be evaluated for a return to the DOD.

As an institution, we will bill the DOD after 60% of the course has passed to reduce the amount of incorrect TA funds being disbursed by the DOD to Luther Seminary. We will only bill for the amount the student earned given their enrollment.

Schedule for Returning Unearned TA 

This return schedule applies to any course regardless of its duration.

Unearned TA funds will be returned on a prorated basis, depending on the length of the course and the amount of the course the student completed.

To determine the amount of TA that needs to be returned the institution will determine the date the withdrawal or date of last attendance, count the number of days the student completed and then divide that by the total number of days in the course to determine the percentage of TA that was earned by the student.

Example: The student enrolled in a course with a scheduled duration of 30 days. The withdrawal was submitted on the 14th day. The institution would perform the calculation to determine how much TA was earned by the student’s attendance:

(14 divided by 30 equals 46.6%. 47% of the TA authorized was earned by the student, which means 53% of what was authorized will be returned to the DOD)

Example: The student enrolled in a course with a scheduled duration of 120 days. The withdrawal was submitted on the 34th day. The institution would perform the calculation to determine how much TA was earned by the student’s attendance:

(34 divided by 120 equals 28.3%. 28% of the TA authorized was earned by the student, which means 72% of what was authorized will be returned to the DOD)

If the student completed more the 60% of the course, the full amount of TA authorize is considered “earned” and no refund is needed.

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