Can you show us a picture of this fungus, or try to describe it?

Are you sowing in pure peat moss? that's not usually recommended and is probably the cause of your problems.

store bought product. Its a cottony looking fungus. I don't have a photo to show. perhaps if I use a fan on it, it would dry out a bit.

I use a spray bottle and a diluted solution of hydrogen peroxide. About half a cap full per bottle or liter of water. Mist the soil surface daily or as soon as you notice it coming back. Another thing I do, is once the seedlings are up, or if you can get away with it now, keep dusting fine dirt on the soil surface (not the peat moss that you used for planting, any plain old dirt will do)

There is a FAQ here about it but basically it boils down to too much water, overly wet soil and inadequate air circulation. Cut back on the watering and increase the sir circulation - that's why a small fan is commonly recommended - and it dies off all on its own.

Dave

I'll give cinnamon and fan a try.

BTW - just recently I tried growing seedlings in coir and I'm surprised that it doesn't have any fungus. its different and I don't know how effective it is as a growing medium but so far it looks fine.