1. All educational institutions must collect tuition and fees based on segments of the instructional program as described in the enrollment agreement, i.e., quarter, semester or term, as defined by the institution, but in no case more than twelve (12) months. Any cash payments made by students, promissory notes made by an educational institution, student loans or other financial aid funds received by an educational institution must be collected and disbursed in accordance with subsection (2) of this policy.
  2. Student loans and financial aid:
    1. Student loans or other financial aid funds received from federal, state, or local governments or administered under the federal student financial assistance programs governed by Title IV of the "Higher Education Act of 1965," 20 U.S.C.A. 1070 et seq., as amended, must be collected and applied in the manner as controlled by the applicable federal, state, or local regulations.
    2. Cash payments made by students, promissory notes made by an educational institution, student loans or other financial aid funds received from private entities including, but not limited to banks, financing companies, credit card companies, and other lending sources must be collected or disbursed in the following manner:
      1. Cash payments made by students, promissory notes made by an educational institution, loans or other financing payments for amounts $5,000 or less may be collected or disbursed as a single disbursement, regardless of the term length.
      2. For certificate-granting programs cash payments made by students, promissory notes made by an educational institution, loans or other financing payments for amounts greater than $5,000 that reflect a term of six months or less must be collected or have two (2) equal disbursements. The collection or disbursement schedule is as follows: one-half (1/2) of the tuition amount collected or released initially and the remainder collected or released halfway through the term.
      3. For degree-granting programs cash payments made by students, promissory notes made by an educational institution, loans or other financial payments may be collected or disbursed as a single disbursement for segments of the instructional program as described in the enrollment agreement, i.e., quarter, semester or term, as defined by the institution.
      4. Cash payments made by students, promissory notes made by an educational institution, loans or other financing payments for amounts greater than $5000 that reflect a term greater than six (6) months up to twelve months must be collected or have three (3) equal disbursements. The collection or disbursement schedule is as follows: one-third (1/3) of the tuition collected or released immediately, the second disbursement collected or released one-third (1/3) of the way through the term, the third disbursement collected or released two-thirds (2/3) through the length of the term.
    3. No educational institution may enter any contract or agreement with, or receive any money from private entities including, but not limited to banks, financing companies, credit card companies and other private lending sources unless the private entity has a disbursement policy that, at a minimum, meets the requirements of subsection (2)(b) of this policy.