Borrowers may reduce or cancel Direct student loans prior to disbursement or within 14 days of the disbursement date. The borrower has 120 days to return any unwanted federal student loan funds as a partial or full cancellation of a previously disbursed loan. These funds can be returned through MUSC or directly to your servicer. The interest and fees are adjusted by the loan servicer for the amount returned within the 120 day period.
Complete the Return of Loan Funds Request form to decrease or cancel a loan already applied and disbursed into your student tuition account (through the Bursar’s office). Write the amount of loan to be returned on the form. The form must be signed by the borrower to authorize the return of funds. For Federal Direct Parent Plus loans, the borrower is the parent, not the student. Round the amount you would like to return to the nearest dollar. Please allow for processing time (at least two weeks) when submitting your request.
We will always reduce/cancel the highest interest rate loans first ( within federal guidelines).
If the school returns Direct Loans on your behalf, your direct loan servicer should send you an updated statement showing the reduction. The return of loan funds will also show on The National Student Loan Data System (NSLDS). Since the Direct Loan servicer updates NSLDS, it may take about 90 days for the returned amount to show up on NSLDS.
Return of loan funds after 120 days of disbursement:
MUSC can only return funds if the disbursement date has not exceeded 120 days. Students who want to return previously disbursed loans beyond the 120 day period should contact their servicer for repayment of the funds. You are responsible for any interest and fees accrued.
Deliver or mail the completed form along with check payable to MUSC in the amount of the return to:
MUSC Bursar’s Office
19 Hagood Ave, Suite 805
Charleston, SC 29425