Colleges Are Closed. Are Students Entitled to a Refund?
Many colleges have all but closed student housing for the rest of the school year and shifted to online instruction in hopes of mitigating the spread of the coronavirus.
The shift has left a lot of students under financial stress. Campus jobs are suspended, and many students are having to scramble to pay for the cost of going back home.
YR Media spoke with Mark Kantrowitz, publisher and vice president of research at Saving for College, a website that helps people learn how to save for college and navigate the financial aid system. We talked about the possibility of refunds for students, the nature of the refunds and the logistics of refunds, as well as the financial conditions of colleges.
This interview has been edited for clarity and length.
YR Media: Many students have been asked to leave their dorms and go home. Are schools responsible to refund students for room and board?
Mark Kantrowitz: Yes. It’s a basic principle that you can’t charge for a product or service if you’re not delivering it. What some colleges will probably do is rather than give you cash back immediately, they may give you a credit towards the next term so that they don’t have to do the refund, which is problematic for the college’s finances. If [a student is graduating], then they need a cash refund. The issue is the overall impact on the financial aid formulas, and that gets complicated. The student may not actually receive it as cash. But rather it may be returned to the lender, for example, because you can’t get financial aid that exceeds the cost of attendance. They’ll still financially benefit in that they’ll have less debt.
YR: If they’re entitled to refunds, how should students go about getting their reimbursement from their school?
MK: If enough students ask for a refund, that may affect the college’s policy. So ask for a refund. Do so politely, because everybody’s under a lot of stress. Do it in writing. It’s a lot harder for a college to ignore a written request than someone speaking on the phone and asking for a refund. They may not keep a record of that call, whereas an email message has to be dealt with, even if it’s just filing it in a folder.
YR: A lot of students didn’t sign up for online-only classes when they paid for tuition. Will it be possible for them to be reimbursed for the change in their learning experience?
MK: If the college already has online education, and they charge the same amount, then your case for a refund may be weaker. Because they can say, “Well we charge this amount for online education.” Though the students and parents can say, “I’ve paid for this and you’re substituting that involuntarily. I think you should give some kind of a discount.” Some colleges might actually do that. None have to date.
I’ve heard from a student who said, “Everything’s been shifted online. I think they should refund my entire tuition.” That’s not going to happen. You did get an education, and the argument the colleges make is that you are getting taught by the same faculty, and that’s part of the value of it.