Obtaining A Contractor License
In order to legally accept and complete any significant contracting work, you will need to apply for a contractor license. An unlicensed contractor is not only risking a penalty, but may not have the right to sue to collect what's due under a construction contract.
Each state has its own licensing requirements. Some states do allow reciprocity with other states, while some don't require a formal contractor license to do work.
There are some basic requirements which are the same, or very similar, in all states. For example, you need to be at least eighteen years old, and hold a high school diploma (or the equivalent). You will need to supply a proof that you are a U.S. citizen or a legal resident. You will also need documentation on any other occupational license you hold in your state, plus two passport-sized photos.
Holding a license in one state doesn't grant you the right to do construction work in another state. Many counties and cities will require a business or occupation license, and many states require that licensed contractors post a state license bond. That bond doesn't protect you from liability in case of an accident or fire on the job, so you will need liability and workers' compensation coverage in each state where you do business.
Most states require license applicants to take a written examination. You must pass Law and Business examination, and an exam covering your specific trade or certification area, before you can apply for a contractor license. You may also have to prove financial ability to run a contracting business, and provide letters of reference from previous employers, customers, architects, engineers or bankers. Many states also require proof of on-the-job experience.
To prepare for a state licensing exam, contact the Contractors State Licensing Board to request an application for a license, and for examination. Make sure that you're applying for a correct classification! States vary on their license classification names and codes. Most exams are based upon a technical book or a Code book. Ask for, and read, all the books and study materials recommended by the Contractors State Licensing Board, including the Code.
Exam study guides and tutorials can prepare you for the exam. Since they are based on past exams, you will be able to familiarize yourself with the type of questions that you'll be asked on the exam. In recent times, computer-based training (CBT), offering multiple choice questions to practice on your own, is fast becoming a standard in exam preparation. You can also take a course to prepare you for a state exam.
Only after you have passed the examination, you can apply for your license. In most states, your exam scores are valid for one year.
