How the ladder works
Contractor took my deposit: the recovery ladder in order
A contractor deposit dispute has two tracks running at once: the payment track (can the money be pulled back through the card or bank?) and the legal track (can the contractor be made to pay it back?). The payment track has the shortest clocks, so it goes first in practice even though the demand letter is step 1 — send the letter and file the card dispute the same week, not one after the other.
| Step | What it is | Why it is in this order |
|---|
| 1. Proof | Contract, payment proof, messages, photos | Every later step asks for the same packet — assemble it once. |
| 2. Demand letter | Written demand by certified mail to the last known address | The fair, dated chance the contractor gets — and the record a court and board want to see. |
| 3. Payment route | Credit: FCBA written notice (60 days) + network filing (~120 days). Debit: Reg E error notice (60 days). Bank transfer: recall ask. Cash: none. | The only step with hard expiring clocks — miss it and the money route closes even if the legal route stays open. |
| 4. Board / bond | Licensing board complaint; surety-bond claim if licensed | The board acts on the license; the bond is the money path tied to it. |
| 5. Small claims | Court filing for the deposit value you can prove | Limits vary by state — check your own state court before filing. |
| 6. Police report | Only where facts point to intentional fraud | Delay or abandonment alone is normally civil breach of contract, not a crime. |
The clocks, honestly labeled
| Clock | Who sets it | The rule |
|---|
| FCBA written notice (credit) | Federal law — 15 USC 1666 | Written billing-error notice within 60 days of the first bill showing the charge; written acknowledgment within 30 days; resolution within two billing cycles (max 90 days). |
| Regulation E error notice (debit) | Federal law — 12 CFR 1005.11 | Error notice no later than 60 days after the statement showing the charge is sent; 10-business-day investigation, provisional credit if it runs longer (up to 45 days). |
| Network filing window | Card-network norm — not a statute | Up to about 120 days from the transaction for most categories; for services not received, from the expected service date, outer cap 540 days in specific cases. Ask your issuer which start date applies. |
| Contract filing deadline | State law — varies | No national figure is stated here: statutes of limitation for breach of contract vary by state. Check your state's deadline early, because it is the clock that ends the court route. |
The trap this tool exists to catch
Two traps, both expensive. First, waiting for the contractor to reply while the 60-day card clock runs out: the demand letter and the card dispute are parallel tracks, not sequential ones — file both the same week. Second, spending the first month on a police report for what is really a civil dispute: delay alone is breach of contract, and a report on those facts generally goes nowhere while the civil clocks keep running. The police step belongs at the end, and only where the facts show money taken for work never intended.
Want the full recovery ladder?
The ladder step by step, what to put in the demand letter, how the board and bond claim differ, what to bring to small claims, and the civil-vs-criminal line — with the checker above the fold.
Read the deposit recovery ladder guide
Sources (verified October 31, 2026): FindLaw — “Your Contractor Took the Deposit and Disappeared. Now What?” (last updated October 14, 2026, fetched October 31, 2026) for the demand letter by certified mail, the licensing-board / attorney-general / local-consumer-office complaints, small claims court, the police-report framing, the civil-vs-criminal line, and the state-variation warnings (including the note that some states license no general contractors); LegalClarity — “Billing Error Law: Your Rights Explained” for the FCBA framework (15 USC 1666, open-end credit only) and “Contractor Not Responding After Deposit? What to Do” for the contractor-deposit-as-billing-error analysis and the certified-mail demand-letter practice; Fair Credit Billing Act (15 USC 1666; 12 CFR 1026.13) for the credit-card 60-day written notice, 30-day acknowledgment, and two-billing-cycle / 90-day resolution rules; Regulation E (12 CFR 1005.11, 1005.6) for the debit-card 60-day error notice, 10-business-day investigation / provisional-credit, and 45-day extended investigation rules; Visa/Mastercard chargeback timeframe norms for the ~120-day issuer filing window (network norm, not a statute; for services not received, from the expected service date, outer cap 540 days in specific cases). Your contract and your state court’s current rules are the final word. Notes on sourcing honesty: no per-state small-claims limit was verified from each state’s own court source for this build, so no state limit table is published — limits are stated only as “varies by state”; no bank-transfer recall deadline was verified, so none is stated; no phone number, fee, or mailing address is claimed here because none was verified for this tool.
General information only — not legal advice. Licensing, deposit caps, bond rules, and small-claims limits vary by state. Verify deadlines with your issuer, your bank, and your state court.
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