disbursed)
Reduced	Direct
Unsubsidized	Loan
Amount
$1,666
($334	reduction	from
original	amount
disbursed)
Direct	Unsubsidized
Loan	Adjusted	First
Disbursement
$833
(original	disbursement
reduced	by	$167)
Direct	Unsubsidized	Loan
Adjusted	Second
Disbursement
$833
(original	disbursement
reduced	by	$167)
Direct	Unsubsidized	Loan
Funds	Returned	to
Department
$334
Volume	8,	Chapter	5,	Example	9:	Re-Proration	of	a	Previously	Prorated	Loan	Limit	for	a	Student	Who	Graduates	Early
From	a	Clock-Hour	Program
A	dependent	student	is	enrolled	in	the	remaining	500	clock	hours	of	a	1500	clock-hour	program	that	has	a	defined
academic	year	of	900	clock	hours	and	26	weeks	of	instructional	time.	Because	the	student	is	enrolled	in	a	final
period	of	study	shorter	than	an	academic	year,	the	school	prorates	the	annual	loan	limit	based	on	the	500	hours
that	it	expects	the	student	to	complete:
($6,500	x	500)	÷	900	=	$3,611	prorated	combined	subsidized	and	unsubsidized	annual	loan	limit
($4,500	x	500)	÷	900	=	$2,500	prorated	subsidized	annual	loan	limit
The	total	prorated	loan	limit	for	the	remaining	period	of	study	is	$3,611,	not	more	than	$2,500	of	which	may	be
subsidized.	The	student	qualifies	to	receive	the	maximum	annual	combined	prorated	loan	limit	in	the	form	of	a
$2,500	Direct	Subsidized	Loan	and	a	$1,111	Direct	Unsubsidized	Loan.	Each	loan	is	paid	in	two	equal
disbursements,	as	shown	below.
Original	Direct	Subsidized
Loan	Amount
$2,500
Direct	Subsidized	Loan	First
Disbursement
$1,250
Direct	Subsidized	Loan	Second
Disbursement
$1,250
Original	Direct	Unsubsidized
Loan	Amount
$1,111
Direct	Unsubsidized	Loan	First
Disbursement
$556
Direct	Unsubsidized	Loan	Second
Disbursement
$555
The	student	successfully	meets	the	requirements	for	graduation	from	the	program	after	completing	only	400
clock	hours.	This	means	that	the	school	must	re-prorate	the	annual	loan	limit	based	on	the	400	hours	that	the
student	actually	completed:
($6,500	x	400)	÷	900	=	$2,889	re-prorated	combined	subsidized	and	unsubsidized	annual	loan	limit
($4,500	x	400)	÷	900	=	$2,000	re-prorated	subsidized	annual	loan	limit
The	total	re-prorated	loan	limit	for	the	remaining	period	of	study	is	$2,889,	not	more	than	$2,000	of	which	may	be
subsidized.	Since	the	student	originally	received	Direct	Loan	amounts	in	excess	of	the	re-prorated	loan	limit,	the
school	must	adjust	the	original	disbursements	and	return	the	difference	to	the	Department,	as	shown	below.	The
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