How to Get a Contractor License

Your Guide to Contractor Licensing in 2021

• What is a Contractor License?

• What Types of Contractor’s Licenses are There?

• How do I Get a Contractor License?

• What Are the Contractor License Requirements? 

• How Long Does It Take to Get a Contractor License?

• How Much Does It Cost to Get a Contractor License?

What is a Contractor License?

In many US states, a contractor license is a prerequisite to legal operation, so depending on where you plan to work it is crucial that you explore your state’s requirements. However, even in those states that do not stipulate this requirement, obtaining a construction contractor license is one of the best things you can do to bring in more customers, protect your business, and ensure you meet legal requirements.

There are many different licenses for all types of construction projects and construction work, covering general contracting to specialty contractors, and qualifying businesses or independent workers can benefit from a license in a variety of ways.

Whether you run a small business or work as an independent building contractor, licensed contractors have a significant competitive advantage over those who are not licensed. This type of license helps you or your business provide a verifiable proof of your experience and skill, increasing trust between you and your customers and ensuring work is completed to a high standard.

In addition to this, a contractor license also allows you to improve working conditions for employees and improve the sustainability of your company, with business management, subcontractor’s and worker’s compensation insurance, and general liability insurance an integral part of the licensing process. Finally, with contractor surety bonding also a prerequisite of many state licensing requirements, homeowners and other customers enjoy increased financial protection up to and sometimes after the successful completion of the job.

What Types of Contractor Licenses are There?

Depending on the type of work you engage in and your construction industry qualifications, there is a broad range of license classifications that you can apply for. These include but are not limited to:

• General contractor license
• Electrical contractor license
• Residential contractor license 
• Electrical contractor license 
• Home improvement contractor license 
• Landscape contractor license bond
• Plumbing contractor license
• HVAC contractor license
• Refrigeration contractor license
• Framing contractor license
• Roofing contractor license
• Fencing contractor license
• Masonry contractor license
• Swimming pool and spa installation contractor license
• Well drilling contractor license
• Lead abatement contractor license
• Elevator mechanics contractor license

How do I Get a Contractor License?

Gaining a contractor license means completing the contractor license application process in your specific state, and each state has its own set of requirements set by the relevant licensing board that can vary quite widely. For this reason, it is highly important to explore how to get a contractor license in the state, or states, in which you plan to operate.

Usually, you will need to apply to your local Department of Labor and the Secretary of State and deliver all the relevant qualification and documentation to these bodies in order to begin your application. However, for more specific details of the licensing requirements in you state, use of drop-down menu below.

Contractor Licensing Requirements per State

What Are the Contractor License Requirements?

While each state stipulates its own contractor license requirements, there is usually a core set of things you will need in order to apply. State license requirements include but are not limited to:

• Train or complete work experience
• Pass a trade exam
• Register your business and trade name
• Obtain an EIN (Employee Identification Number) from the IRS
• Show proof of insurance for worker’s compensation and general liability
• Show proof of a constructor surety bond
• Complete an application form and provide documentation

For more information on applying for a license and the type of surety bond you will require to successfully support your application, contact Lance Surety today to discuss your specific needs.

How Long Does It Take to Get a Contractor License?

The application process for a new license depends on a number of factors, including but not limited to:

• The type of license you wish to acquire
• The number of years of experience you currently have
• The amount of training you will require
• How quickly you pass the required tests 
• How quickly you can correctly fill the application and provide the required documents

All taken together, this can mean your license application can take anywhere from 2-3 months to 3-5 years. Obviously, those with significant experience and the right qualifications within the industry will work through the process quicker than those who are new, however, everyone can benefit from ensuring all paperwork is provided upon application to reduce the amount of time it takes the state to process the application.

How Much Does It Cost to Get a Contractor License?

The cost to obtain a contractor license varies from state to state, and you will need to check the specific costs where you plan to operate. As a general rule, you can expect to pay between $50-$200 for a license application, however, the other costs such as background and criminal checks, experience and education minimums, and financial documentation including bonding and insurance can vary quite significantly.

For example, a California general contractor license will require a $330 application fee, a $200 license fee, and a surety bond amount of $15,000 with the annual costs associated with tied to your credit score. In addition to this, active licenses must be renewed every two years at a cost of $450, and there are also other costs you may need to consider such as continual training and updating qualifications.