Over the years many veterans have found themselves in a situation in which they owe the VA for an “overpayment” of GI Bill benefits. The number of veterans experiencing indebtedness to the VA has increased since the Post-9/11 GI Bill went into effect. There are several situations in which you may find yourself owing the VA for GI Bill overpayments, but the most common cause is changing your enrollment, especially changing it after the school’s drop/add deadline.
The VA says that if you decrease your training time (i.e. drop classes, leave school, etc.) and they have already processed a payment for tuition and fees an overpayment will occur. When the school notifies the VA of a change, a debt is created against your account.
If I Drop A Class What Do I Owe The VA?
Normally if you drop a class you will have to pay back any GI Bill money you received for that class to the VA. This includes your tuition & fee payment (even though it was paid to the school - not you), your Monthly Housing Allowance, your book stipend, and any kicker or college fund money you received.
Why Do I Have To Pay Back The Tuition & Fees to the VA? The School Got Them, Not Me.
According to the VA, it is your responsibility to pay them back and then go to the school and see if you can get a refund. That is because school refund policies are different at each school, and it would be far too cumbersome for the VA to try and deal with it at thousands of schools worldwide.
The VA will collect from the school if:
- You never attended any classes for which you were certified regardless of the reason for non-attendance
- You completely withdrew on or before the first day of the term
The VA will collect from you if:
- You totally withdraw after the first day of the term
- You dropped classes resulting in a reduced training time
The VA says that you are responsible for keeping track of your tuition and fee account balance and payments. They recommend that you visit their school's financial office regularly to review your account, ensure the charges are correct and that payments and refunds are processed correctly. They also recommend that you contact your school’s certifying official to ensure the certification information they send matches your class schedule.
What Happens If I Had A Good Reason For Dropping Classes?
In some cases the VA is willing to forgive an overpayment due to mitigating circumstances.
Mitigating circumstances are circumstances beyond your control that prevent you from continuing in school or that cause you to reduce credits. Mitigating circumstances include the following:
- An illness or injury afflicting the student during the enrollment period.
- An illness or death in the student’s immediate family.
- An unavoidable change in the student’s conditions of employment.
- An unavoidable geographical transfer resulting from the student’s employment.
- Immediate family or financial obligations beyond the control of the claimant that require him or her to suspend pursuit of the program of education to obtain employment.
- Discontinuance of the course by the school.
- Unanticipated active military service, including active duty for training.
- Unanticipated difficulties with childcare arrangements the student has made for the period during which he or she is attending classes.
If you withdraw or drop classes after the drop period and a non-punitive grade is assigned -- and mitigating circumstances are an issue -- adequate evidence of mitigating circumstances must be provided to the VA. If this evidence is not provided, the VA will not pay for the course or courses in question, leaving YOU responsible to pay the school for any remaining tuition and fees.
The school can report your withdrawal reason to the VA if you contact your certifying official and explain it to them. For example, the School Certifying Official may report the following to the VA: “Student withdrew 5/6/16 following Father’s death on 4/30/16.” Submitting the reason for the reduction or withdrawal at the time the change is reported will help the you avoid or reduce an overpayment if the change is for an acceptable reason.
If you have already been paid for the course or courses VA will create an overpayment (subject to the 6-credit hour exclusion described below) from the beginning of the term, quarter, or semester.
Realizing that sometimes situations arise that result in you dropping classes, the VA automatically grants mitigating circumstances for up to 6 credits the first time you drop a class or classes outside of the drop/add period. The VA refers to this as the 6-Credit Hour Exclusion. You can only use this free deal one time though.
What If I Have More Questions?
The VA recommends that you contact their Debt Management Center if you receive a debt notification from the VA. The Debt Management Center is the authoritative source of debt collection information. You can reach the Debt Management Center at 800-827-0648 or e-mail them at email@example.com.