law

Indiana Real Estate Recovery Fund

A fund under IC 25-34.1-7 for consumers holding a final judgment against a licensee for embezzlement or for obtaining money through false pretenses, trickery, or forgery, with an actual cash loss they cannot collect. The application is verified and filed within one year after all proceedings end. The fund pays actual loss plus court costs, but not attorney's fees or punitive damages, capped at $20,000 per judgment and $50,000 per licensee, prorated if claims exceed the cap. Payment requires suspension of the license until repaid with 12% interest.

Exam tip: '20 per judgment, 50 per agent, 12 to come back.' A loss from falling property values is not covered.
Example: Three buyers win $30,000, $20,000, and $10,000 judgments against one broker. Capped at $20,000 each, eligible claims total $50,000, which equals the per-licensee limit.

1. Which loss could qualify for payment from the Indiana Real Estate Recovery Fund?

Answer & explanation

Answer: C. The fund covers actual cash loss from embezzlement, false pretenses, trickery, or forgery after a final judgment. It excludes market-value declines, punitive damages, and attorney's fees.

Related terms & state variants

conversion fraud recovery fund

Sources

Source verification pending. Confirm current requirements with your state regulator.

Last verified: 2026-10-23