Student Aid Reference Desk | Disbursement | Power of attorney

Disbursement

Institutions are responsible for conveying financial aid funds to their Title-IV eligible students in accordance with very detailed regulations and for establishing accounting and recordkeeping systems that ensure proper handling of federal funds. Disbursement is, in a sense, the culmination of the various aspects of determining student eligibility.

Related topics in this Index: Cash Management; Recordkeeping; Verification

Statutory Authority

U.S. Code, Title 20—Education Chapter 28—Higher Education Resources and Student Assistance Subchapter IV—Student Assistance > Part A—Grants to Students in Attendance at Institutions of Higher Education, Subpart 9—TEACH Grants § 1070g Definitions [HEA § 420L]

U.S. Code, Title 20—Education Chapter 28—Higher Education Resources and Student Assistance Subchapter IV—Student Assistance > Part G—General Provisions Relating to Student Assistance Programs § 1094(a)(19) Program participation agreements [HEA § 487(a)(19)]

Regulation

ED References

See also Subtopics for more specific references.

2020-21 FSA Handbook, Vol. 6

2020-21 FSA Handbook, Vol. 3

2020-21 FSA Handbook, Vol. 4

Publications, Articles & Other Resources

Aid Disbursement Delays: Measures, Causes, Solutions (The International Journal of Management Research and Practice)

Award Letter Self-Assessment Guide (National Association of Student Financial Aid Administrators)

Cash Management AskRegs Knowledgebase Q&As (National Association of Student Financial Aid Administrators)

Cash Management Self-Study Guide (National Association of Student Financial Aid Administrators)

Computer Assisted Financial Aid Disbursement and Loan Collection (Journal of Student Financial Aid)

Effect of Financial Aid Processing Policies on Student Enrollment, Retention and Success (Journal of Student Financial Aid)

Incremental Disbursements of Student Financial Aid: Final Report on Aid Like a Paycheck (MDRC)

The Effect of Financial Aid Disbursement Policies on Student Course Completion (ProQuest Dissertations Publishing)

Using Professional Judgment In Financial Aid To Advance Racial Justice and Equity (The Education Trust)

Subtopics

Authorizations to perform certain optional functions on student’s behalf

General rules regarding authorizations

668.165(b)(2) - (4)

675.16(d)(2) - (4)

Federal Register, 9/29/17, pp. 45465 to 45471

2020-21 FSA Handbook, Vol. 4, Ch. 2

Hold funds for student or parent rather than paying them directly

General rules

668.165(b)(1)(ii)

675.16(d)(1)(ii)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Deadline for payment of remaining balance

668.165(b)(5)(iii)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Payment of prior year charges

668.165(b)(1)(i)

675.16(b)(1)(ii)

675.16(d)(1)(i)

Use of FWS to pay current year institutional charges

675.16(b)(1)(i)

675.16(d)(1)(i)

Books and supplies provision

2020-21 FSA Handbook, Vol. 4, Ch. 2

Prorating

Electronic Announcement, 3/5/19

By payment period

2020-21 FSA Handbook, Vol. 3, Ch. 1

Checking student’s eligibility at time of disbursement

2020-21 FSA Handbook, Vol. 4, Ch. 2

Confirmation process for loans and TEACH Grant

2020-21 FSA Handbook, Vol. 4, Ch. 2

Contracted services

Electronic Announcement, 5/18/12

2020-21 FSA Handbook, Vol. 4, Ch. 2

Correspondence student

2020-21 FSA Handbook, Vol. 4, Ch. 2

Credit balances

See Authorizations regarding disbursement institutions must obtain to offer optional services and Third-Party Servicers

General rules

2020-21 FSA Handbook, Vol. 4, Ch. 2

Holding credit balances

2020-21 FSA Handbook, Vol. 4, Ch. 2

Loan disbursements subject to 30-day delay

2020-21 FSA Handbook, Vol. 4, Ch. 2

School-issued stored-value cards with no third party involvement

2020-21 FSA Handbook, Vol. 4, Ch. 2

Unclaimed credit balances

668.164(l)(2), (3)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Crediting student’s institutional account

Bookstore charges

2020-21 FSA Handbook, Vol. 4, Ch. 2

Consent

668.164(f)(4)(i)(B)

Federal Register, 10/30/15, pp. 67151 to 67155

Current year charges

675.16(b)(1)(i)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Institutional charges vs. non-institutional charges (definitions)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Pass-through charges

2020-21 FSA Handbook, Vol. 4, Ch. 2

Prorating charges

2020-21 FSA Handbook, Vol. 4, Ch. 2

Prior year charges

668.164(c)(3), (4)

675.16(b)(1)(ii)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Student choice

Federal Register, 10/30/15, pp. 67151 to 67155

2020-21 FSA Handbook, Vol. 4, Ch. 2

Day

668.161(a)(3)(iv)

Death of student

See also top list entry for Verification

2020-21 FSA Handbook, Vol. 4, Ch. 2

2020-21 FSA Handbook, Vol. 5, Ch. 2

Direct payment

Date of issuance of check to student

668.164(d)(1)(i)(B)

668.164(d)(1)(ii)(B)

Methods of making

2020-21 FSA Handbook, Vol. 4, Ch. 2

Disaster guidance

Disbursement (date of disbursement) defined

Electronic Announcement, 1/29/14

2020-21 FSA Handbook, Vol. 4, Ch. 2

Disbursement records (submission to ED)

See top list entry for Cash Management

During reapplication when program participation agreement expires

Early disbursement before first day of class

668.164(a)(2)(ii)

2020-21 FSA Handbook, Vol. 3, Ch. 1

Garnishment of Title IV funds

HEA Sec. 488A(d)

2020-21 FSA Handbook, Vol. 4, Ch. 2

2020-21 FSA Handbook, Vol. 6, Ch. 2

Late disbursement

Completion of enrollment prior to receipt of funds

668.164(j)(3)(ii)

Conditions to qualify for late disbursement

2020-21 FSA Handbook, Vol. 4, Ch. 2

FWS payments after last day of attendance

Limitations and prohibitions

2020-21 FSA Handbook, Vol. 4, Ch. 2

Notification requirement for late disbursement of loans

2020-21 FSA Handbook, Vol. 4, Ch. 2

Post-withdrawal disbursement

668.22(a)(6)(iii)

668.164(j)(3)(i)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Student ceases qualifying enrollment

668.164(j)(3)(iii)

Summary chart

2020-21 FSA Handbook, Vol. 4, Ch. 2

Multiple disbursements within payment period

685.303(d)(3)(i)

2020-21 FSA Handbook, Vol. 3, Ch. 1

Notices from institutions regarding disbursement to students

General information

2020-21 FSA Handbook, Vol. 4, Ch. 2

Acceptable means of notification

2020-21 FSA Handbook, Vol. 4, Ch. 2

Amounts of Title IV funds and how and when disbursed

686.31(e)(1)(i)

Crediting of Title IV loan or TEACH Grant funds to student’s charges

668.165(a)(2), (3)

Right to cancel Title IV loans or TEACH Grant

668.165(a)(2) - (6)

2020-21 FSA Handbook, Vol. 4, Ch. 2

Power of attorney

FWS

2020-21 FSA Handbook, Vol. 4, Ch. 2

Program-specific disbursement rules

Direct Loan

General disbursement rules

2020-21 FSA Handbook, Vol. 3, Ch. 1

30-day delay for first-year, first-time Direct Loan borrowers

668.164(a)(2)(i)

Continuous eligibility

Disbursement dates and amounts

Substantially equal disbursements

FSEOG

FWS

2020-21 FSA Handbook, Vol. 4, Ch. 2

Pell Grant

Completion of previously paid hours (clock hour and nonterm credit hour programs)

Retroactive payments based on completed work

2020-21 FSA Handbook, Vol. 3, Ch. 1

Retroactive disbursements for completed periods within award year

2020-21 FSA Handbook, Vol. 3, Ch. 1

Social security number of student not verified