How to Get a Contractor License for Construction

The construction industry has more than rebounded from the market crash. Positive trends in residential markets and an added focus on infrastructure mean that the United States is one of the largest and strongest construction markets worldwide. According to The Bureau of Labor Statistics, the U.S. construction industry will be one of the fastest-growing industries into 2020.

If you have construction skills and experience, you may be looking to run your own projects. If that’s the case, you’ll want to get a contractor license before you start. Having a license will give you a competitive advantage in the marketplace for construction because more and more people are demanding licensed contractors.

The following is a quick guide on how to get your contractor license. Be aware, this is a general guide because each state will have its own rules. Some states will require you to get licensed, by passing an exam and meeting other criteria, while other states will require that you register your organization. It’s important to know the difference between the two and what your state requires.

The first five steps below are what you need to do before submitting your application.

1.      Know your license class

Most states grant licenses restricted to the size of the projects you expect to undertake. In most jurisdictions, the classification is tied to the cost of the project. Make sure you know what your looking to do and which license qualifies you for that type of work.

Some jurisdictions also require you to pick a specialty, like drywall, appliances, electrical, or flooring. If you’re planning to specialize, there may be additional steps you’ll need to investigate.

2.      Register your company

To properly practice your trade as a licensed contractor, you’ll need to create and register a company with the state. Most states have a designated website and department to help with this process. Find which business organization is best for you, like an LLC, and look into how to register your organization with the state. Make sure you get an Employer Identification Number if you plan to have any employees.

3.      Pass the test

School may be out, but that doesn’t mean you’ll never have to take another exam. Depending again on your state, you will need to take and pass one or several examinations before the state will license you. The exam will cover several topics, ranging from running a business to technical trade practices. To better prepare, start here.

4.      Get insurance and a bond

Many jurisdictions require you to have insurance before you can practice as a contractor. Given the inherent risks associated with construction and contracting work, insurance is meant to protect you, your employees, and your clients against any liabilities and losses. You may also need a bond to protect you from losses in case you can’t finish a project or meet a customer’s satisfactions.

5.      Pass the background check

Many states also require a background check. Make sure to follow the steps required by the state in which you intend to work. Also, get a copy or document you can submit with your application.

6.      Final steps

Once you’ve completed everything to get your license application ready, pay the fee and submit your application with all the required documents establishing you’ve followed the steps above. From here on out, it’s a waiting game.

Looking for construction jobs to improve your skill set? Try here.