What is the maximum amount an individual could receive from the real estate recovery fund in the United States? $100k, $50,000, $30,000 or $25k? The Real Estate Recovery Fund is a fund maintained by many state real estate commissions to assist in compensating victims who have suffered as a result of a breach of a real estate agent’s or broker’s responsibilities but were unable to recover because there was no insurance and no discoverable assets.

The maximum amount payable to an individual tends to vary across board as every state maintains the right to dictate and implement policies around and within its territory. The limits are established by the State’s legislature to make over funds to victims of fraud, misrepresentation and deceit committed by a real estate licensee, where the victims are otherwise unable to recover on a court judgment.

What is the Maximum Amount an Individual Could Receive from the Real Estate Recovery Fund

Since every state in the United States fund and maintain their own individual Real Estate Recovery Fund, the maximum amount payable to an individual also tends to vary by state.

1. California

For instance, in California, if the application is granted, the Department of Real Estate will pay the victim his or her actual and direct loss in a transaction, up to a statutory maximum of $50,000 per transaction, with a possible total aggregate maximum of $250,000 against a licensee.

2. Florida

While in Florida, the Commission will not pay more than $50,000 for a judgment involving a single transaction. In addition, the Commission will not pay any legal fees and the maximum amount that the Commission would pay for the claims is $150,000.

3. Georgia

In the State of Georgia, no person who establishes a proper claim or claims under the Real Estate Recovery Fund Code section shall ever obtain more than $15,000.00 from the fund. While in Texas, Payments from the Real Estate Inspection Recovery Fund may not exceed $12,500 per transaction, with a maximum of $30,000 per license.

Over the years, various jurisdictions have established statutory real estate recovery funds to protect the public by covering certain types of judgments against licensed real estate brokers, their agents, and salespersons in some cases, when the aggrieved party would otherwise go unpaid.

When a payment is made from the Recovery Fund, the agent or broker’s license will be automatically suspended until the amount is repaid into the Recovery Fund, with 10% interest, by the offending licensee.

Also, when the account drops below a certain amount, the commissioner in the state is authorized to add extra charges into every broker’s license fee, and extra too to that of each salesperson. The real estate commissioner is also authorized to transfer funds from the general real estate fund into the account as deemed necessary.

However, the overwhelming majority of real estate recovery count cases tend to do mainly with mortgage fraud and conversion of trust funds. Howbeit, the application of Recovery Account funds is strictly limited. It doesn’t solve all the problems, but it has provided a lot of help over the years. Since its inception in the 1960s, the Recovery Account has paid out in excess of $50 million to claimants.

Requirements to be met in Order to have a Valid Claim against the Recovery Account

Just like it was stated above, the real estate recovery fund means funds used for the reimbursement of aggrieved persons who suffer monetary damages due to acts committed by licensed real estate brokers or salesmen. A variety of requirements must be met in order to have a valid claim against the Recovery Account. These requirements, which may also vary across board, may include;

  1. A final judgment is expected to have been obtained already, either in court or through an approved arbitration procedure. This simply means that no one is required to go to the account to start arguing the merits of the case itself.
  2. The claimant is also expected to have pursued collection efforts against the judgment debtor already and, in situations where it is appropriate, against “all other persons liable to the claimant in the transaction that is the basis for the underlying judgment.” Note that one does not obtain the judgment and then proceed directly to the Recovery Account.
  3. The judgment debtor is expected to have been a real estate licensee at the time the underlying transaction occurred. Even though this requirement seems simple enough, it has sometimes been an occasion for dismay. For instance, imagine the judgment debtor’s license had been expired at the time of the transaction, or that the person never had a license in the first place – that he was an imposter – the Recovery Fund cannot pay on the claim.
  4. The judgment debtor is expected to have been performing acts for which a real estate license was required. The judgment is also expected to have been based on a real estate transaction. You couldn’t go to the Recovery Fund because a real estate licensee had stolen your car.
  5. In addition, not only is the acts expected to have been related to a real estate transaction, but also they must have involved fraud, misrepresentation, deceit, or a conversion of trust funds. This is a very specific requirement, and was confirmed in an appellate court decision (Yergan v. Department of Real Estate, California Second District Court of Appeal, and January 25, 2000). Note that in that case, the judgment is based on negligence and breach of duty. The court upheld the DRE’s refusal to pay a Recovery Account claim, because the judgment was not based on fraud.


Every state has laws to protect the public from unscrupulous real estate professionals. However, sometimes a few bad agents fall through the cracks and cause their clients to lose money. But over the years, people have learned that it is one thing to go to court and obtain a judgement against someone; to collect can be quite another matter. That is why the Recovery Account, often referred to as the “recovery fund”, was established.

The Recovery Account is the last resort for a member of the public who has obtained a final judgment against a real estate licensee based on fraud or certain other grounds and who have been unable to satisfy the judgment through the normal post-judgment proceedings. If you or someone you know has been the victim of a real estate fraud by an agent or broker, it is advisable you first consult a real estate attorney to guide you in pursuing the appropriate recoveries.