Contractor Recovery Fund

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Contractor Recovery Fund

The Contractor Recovery Fund provides financial compensation to Minnesota homeowners, residential lessees and homeowners associations (HOAs) who have experienced an actual and direct out-of-pocket loss resulting from fraudulent, deceptive or dishonest practices, conversion of funds or failure of performance by a licensed residential building contractor or residential remodeler.

Who may apply

You may be eligible to apply to the Contractor Recovery Fund if all the following are true:

You are a Minnesota homeowner, residential lessee or HOA.
Your loss occurred on owner occupied residential property located in Minnesota.
You hired a contractor who held an active residential building contractor or residential remodeler license at the time you signed the contract and when the work was performed.
You experienced an actual and direct out of pocket loss caused by the contractor’s fraudulent, deceptive, or dishonest practices, conversion of funds or failure of performance.
You obtained a final, docketed judgment against that licensed contractor.
Your application to the Contractor Recovery Fund was submitted within two years of the date that the final judgement was entered.

Check if your contractor was licensed

Before applying, verify the contractor’s licensure status using DLI’s online lookup tool.

You can find a contractor by business name or by their license number. Residential building contractor licenses have a prefix of "BC" and residential remodeler licenses have a prefix of "CR."

What the fund can and cannot pay for

The fund may reimburse actual and direct out of pocket losses. These are documented expenses you personally paid and may include the amount needed to repair or complete the work due to the licensed contractor’s conduct that caused financial harm.

The fund may consider both the amounts you have already paid and the reasonable cost to repair or complete the work when determining your loss. However, it cannot reimburse any projected costs that are not supported by documentation.

The losses may be recoverable if the contractor:

did not complete work required under your contract;
performed work so poorly that it must be repaired or redone;
caused damage that required repair, or
acted fraudulently or deceptively (for example, taking payment for work they never intended to complete).

The fund does not provide compensation for attorney’s fees, costs or disbursements incurred in obtaining the judgment; costs related to applying to the fund; or any interest or costs not part of the residential structure, such as landscaping, fences, driveways, pools or accessory buildings.

The fund cannot pay more than the amount awarded in your judgment, even if bids or estimates to repair or complete the work are higher than the judgment amount.

For a complete list of covered and non-covered losses, review How to Apply to the Contractor Recovery Fund.

How to apply

Before submitting your application, review How to Apply to the Contractor Recovery Fund. These instructions explain eligibility, required documents, and important information about the application process, including how to have your judgment docketed.

After reviewing the instructions, you may submit your application electronically through iMS – our online permitting, license and application system – or by mail using the paper application.

Electronic application (preferred)

To apply electronically, you must create an iMS account. You will enter all application information directly into the system and upload required supporting documents.

Submit an online application via iMS here.

After creating your iMS account, select the "Enforcement" tile, then select “Help with a contractor issue,” and then select “Recovery Fund.”

View more about how to create an account and get started with iMS.

Charts (worksheets) – Submit with your application

Payment chart (required). If you are submitting electronically through iMS, you must use this chart: Microsoft Word payment chart | PDF payment chart. If mailing your application, you can use the provided chart example, the chart included in the printable application or create your own.
Estimate chart. If applicable, include the estimate chart to show estimates from others to repair or complete the work under the contract: Microsoft Word estimate chart | PDF estimate chart

Paper application

If you choose to apply by mail, the paper application must be completed in full and mailed with all required supporting documents.

Complete and submit this application packet by mail.

You may use the paper application form to gather and organize your information prior to submitting electronically through iMS. However, do not submit the completed paper application through iMS.