Finding Text
Criteria: 34 CFR 685.203(j) Maximum loan amounts. In no case may a Direct Subsidized, Direct Unsubsidized, or Direct PLUS Loan amount exceed the student's estimated cost of attendance for the period of enrollment for which the loan is intended. Condition: A sample of 40 students were selected for student file testing. Of those tested, one student was over awarded for the period of enrollment by $679. The University is allowed a tolerance of $300 in over awarded aid, but that was exceeded in this case. This student was initially packaged with Federal Work Study funds, but declined them. The student later changed their mind and ended up earning Federal Work Study during the enrollment period. The direct loans for the student were never adjusted accordingly. Context: The deficiency was discovered during the audit testing of student files and Federal Work Study. Effect: The University should have reduced the amount of direct loans for this student by $679 to accommodate the Federal Work Study award so the student was within the cost of attendance budget. Cause: This appeared to be an isolated incident where the initial packaging of the student with Federal Work Study allowed them to later apply for and earn Federal Work Study wages. The University?s systems prevent students who are not packaged to receive Federal Work Study from applying for those positions without approval from the Financial Aid Department first. The student?s declining of the initial award did not result in an update in the software to prevent them working a Federal Work Study position without notifying the Financial Aid Department. Recommendation: We recommend the University require that all applications for Federal Work Study positions be reviewed by the Financial Aid Department prior to the student obtaining a position to ensure any awards are adjusted if needed.