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VCOM Campus

Returning Federal Student Loan Funds

Federal loan funds that are returned within 120 days of disbursement will have all origination fees and accrued interest negated off of the amount returned. Returning monies this way will directly reduce the principal of the loan. Monies returned after the 120-day window has passed will be treated as a pre-payment and will pay interest before principal.

If you have unneeded funds from your student loan refund and it is within 120 days of disbursement, it is financially smart to return that money. If you anticipate having unneeded funds following a future disbursement, you can request that the Office of Financial Aid cancel or reduce the upcoming disbursement.

Steps to return federal student loan funds:

  1. Go to the and log in. Make sure you are on your “Dashboard” page. You can do so by hovering over your name in the top right corner and clicking on “Dashboard”.
  2. You will see a summary of your loans. Click on “View Details” above the loan summary to view your loan servicer(s) and your loan details.
  3. Scroll to the bottom of the page. Clicking on the small box next to your loan servicer’s name will take you directly to their website.
  4. Contact the loan’s servicer and tell them that you want to return unneeded funds within the 120-day disbursement window so the return will reduce the loan’s principal. Make clear to the servicer that you are not “making a payment”; you are returning unused funds and want the return credited against the principal of your loan, with the origination fees and accrued interest negated.
  5. Follow up in a month or so by logging into and checking the balance of the loan to make sure the servicer reported the reduction. You can also view the payment breakdown on the loan details page by clicking on “Payment History”.