What is a Federal Student Aid (FSA) credit balance?
A. An FSA credit balance occurs when the amount of Title IV funds that the school delivers to a student’s account exceeds the school’s allowable institutional charges. Source: Federal Student Aid Handbook, Volume 2-Institutional Eligibility and Participation, p. 2-96. Q. When a student or parent borrower has provided the school with written authorization to hold a FSA credit balance, is there a maximum time frame in which the school must pay any remaining funds to the borrower, despite the borrower’s authorization? A. Yes. The school must pay any remaining loan funds to the student or parent borrower by the end of the loan period. The school must pay any other remaining Title IV funds by the end of the last payment period in the award year for which they were awarded. Note: If a student or parent borrower cancels his or her authorization for the school to hold an FSA credit balance, the school must pay the remaining funds directly to the student or parent borrower as soon as possible b
