Key takeaways:
- A financial aid refund is money that’s left over from a financial aid package after a college tuition bill is fully paid.
- Colleges will send financial aid refunds through direct deposit or check, or the student can keep it in a school account for future expenses.
- Some forms of aid have restrictions on what they can cover and may not be refunded to the student.
Flickr user Amy Jutras
If your financial aid package exceeds your college tuition bill, you might receive a financial aid refund. You can use this money for other education-related expenses, including your books and supplies. However, colleges often don’t send refunds until after the semester starts, which means you need to plan ahead if you’re relying on that money. In this guide, we walk you through the basics of financial aid refunds and explain what types of aid qualify, when you can expect your refund, and more.
What are financial aid refunds?
A financial aid refund is any money from your financial aid package that is left over after your college tuition bill is paid for.
Financial aid package – college tuition bill = financial aid refund
The money is given directly to you or kept on your school account for future expenses.
Most forms of financial aid go directly to your college, to be used towards your tuition bill first. Depending on your situation and school, your tuition bill can include tuition, fees, meal plans, and housing. For some students, their financial aid package exceeds this amount. This extra money often goes to the student to be used towards other education-related expenses, such as books, supplies, and transportation.
Keep in mind: the term “refund” can be confusing, as you may receive excess money that comes from student loans. This is money you will still need to pay back with interest as agreed.
What types of financial aid are eligible for a refund?
Many types of financial aid will be refunded to you if there’s any extra money after your college bill is paid, including federal grants, federal student loans, private student loans, grants, and scholarships.
Some scholarships and grants have restrictions and won’t be refunded to the student. For example, an outside scholarship a student won is earmarked for “tuition” only. If the award exceeds the cost of tuition, the college will often have to return the money to the scholarship program rather than pass it onto the student. However, if the individual also receives student loans, they won’t have to use the loans to pay for tuition and will receive a refund for the excess after other expenses are covered.
Will I receive a financial aid refund?
Whether you receive a financial aid refund and how much you receive depends on your college bill and financial aid package. You can find out if you receive a refund and potentially how much by visiting your school’s online billing portal. If you can’t find the information, reach out to your college’s financial aid department.
When will I receive my refund?
Your college’s payment processing schedule determines when you receive your financial aid refund, but most start sending refunds one to four weeks after the semester starts. After your refund is processed, it will be a few days before it shows up in your account.
You may need to plan ahead if you’re relying on your excess aid to pay for books and supplies. Some schools offer resources to help you access the money before it’s processed, and others have early financial aid disbursement to qualifying students, which means the bill is paid for sooner, and you receive your refund faster.
How will I receive my refund?
Most students receive their financial aid refund through direct deposit to their personal bank account. You need to submit your bank account details to the college by their stated deadline.
You can also opt for a check or choose to keep the money in a school account to be used towards future education expenses and bills.
If you need money for your books, supplies, and other education expenses, your financial aid refund can help you cover the cost. For some, the refund can be thousands of dollars – and tempting to spend on non-essentials. Remember: this money is supposed to last you the semester or even the entire academic year. Create a budget to use it wisely.
Before you even apply to colleges, you can get an estimate on your financial aid offers to help you better budget for your degree. Use College Raptor’s College Match to learn more about potential awards, estimated debt after graduation, and more.
