The Contractors Exam: Laws About People Who Build Houses

You might be thinking, hey, I’m not insane and taking a contractors exam in a week and half, so why do I care about this? And the answer is that obviously I’m the crazy one here and you don’t.


It’s possible that knowing some of this stuff couple help you in circumstances where you need to hire a contractor, or if you completely lose it and decide build your own house. You decide.

Licenses, Who Needs ‘Em?

Only about half of the states require people to prove that they are at least half-way competent before they’re allowed to, say, tear some walls out of your house or construct the roof you sleep under every night. For those of you in Illinois, Ohio, Maine, Missouri, Texas, Wisconsin, Indiana, Kentucky, New Hampshire, New York, Pennsylvania, South Dakota, Wyoming, Colorado, Idaho, New Jersey, Oklahoma, Rhode Island, and Vermont… sorry about your luck.  Any idiot with a hammer is legally allowed to sell you their construction expertise. Kansas and Nebraska are my fave, because you only need to prove you’re competent if you’re from out of state. Either construction is a required subject in high school there, or the Kanbraskans are just smarter than the rest of us.

For the rest of the states that do require some sort of licensure, when you need it varies by state. In Michigan you need to have a license to do more than $500 of work, for example, and in Arkansas the limit is $20,000.

In states that you need a license, it’s gotta be displayed in your place of work, which I have to say makes more sense when you’re a hair-stylist or somewhere people come to you for a service… when’s the last time you were in a builders office? (Which is probably why they give you a pocket card too.)

For more information on what the requirements are by state, check out this site.

And just because some states try to keep any goofball with a toolbelt from doing construction, the good news for all of us is that any goofball who owns a house is allowed to work on it (or build it) themselves.

Get it In Writing

Any time you hire anyone to work on your property, there should be a written and signed contract in place– that’s for the protection of the contractor and the customer. And a good contract needs more than just a price, it should include these things:

  • Scope of work
  • Process for handling change of scope
  • Responsibilities of parties
  • Payment schedule
  • Time to completion
  • Resolution of disputes
  • Warranties/disclaimers
  • Insurance and surety bonds

Contractors Gone Wrong

Got a complaint against a “pro”? God knows I’ve known a few who needed to have their heads knocked together like a couple of coconuts. Here are a couple legitimate complaints that can be filed against a licensed contractor:

  • If they abandon a project or contract without legal cause– like non-payment. (In Michigan, if you start a job, you have to finish it. Period.)
  • If they use money from one project to fund another. If you give a contractor money, they can’t float another project with it. Big no-no.
  • If they disregard building plans or material specs without consulting the owner. A good reason as a homeowner to be smart about understanding your building plans and specs.
  • If their workmanship does not meet code. If they do it wrong, they have to make it right, and you shouldn’t have to pay extra for it.

Up next in the Contractors Exam… Building Codes! Yeah, it doesn’t get much more exciting than that, unless you count the fact that the tile for the DIY Walk-In shower will be here tomorrow.

6 Responses

  1. LOL, I just spit water all over my screen when you made up the word “Kanbraskans!”

    We’re in one of those unlucky states. I totally see why being licensed is important but on the other hand I’m glad it’s not required in our area because that means my very knowledgeable dad and father-in-law can help us DIY our remodels. No need to pass a test and collect $200 when you pass Go. My FIL actually used to be a licensed contractor (along with being a licensed home inspector) when he owned his own residential house building company but let it lapse when he got a job working for the big commercial builders and didn’t need it anymore. Now he’s unemployed (very hard to find a job in the construction field at his age) and working side jobs to fill in the gaps. Whether someone is licensed or not people still need to know how to pick the right contractor or there will be 20 more seasons of Holmes on Homes!

    On a side note I’m studying for my own “license” right now and I really need to get my butt back in gear! I’m taking the FE in April. Why? So I can take another test (the PE) next April. Makes total sense.

  2. Christ. I live in Nebraska. That just scared the hell outta me – I had no idea (and wth about all that “out of state” crap? I swear, half the laws here don’t make.any.sense.).

    Thank goodness for DIY! (another good reason for DIY, apparently.)


  3. In California, you need a license for work of $500 or more, unless it’s your own house. The work still needs to meet code, of course (including Title 24 energy efficiency requirements), but you’re free to do-it-yourself. Which also means having friends and family help you, if you can drag them in 🙂

  4. Good information. A great way to find competent contractors is to contact your local BBB, or better yet, your local Home Builder’s Association. It’s not a guarantee, but it is more likely contractors who are involved with, or active in either organization will conduct themselves in a professional, reliable manner. Keep up the good work with your blog.

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