Michigan contractor license requirements

Licenses and registrations

Individual Residential Builder

Anyone who builds residential structures for pay. It allows building a complete residential structure and also maintenance and alteration (remodeling) work.

• When it applies: Required unless the aggregate contract price for labor, material and any other item is less than $600.00. The exemption does not apply if the work is part of a larger operation or is split up to evade the law.
• Good to know: You cannot hold both a Residential Builder and an M&A license.

Maintenance & Alteration (M&A) Contractor

Contractors who repair, alter, add to, wreck or demolish residential structures, build garages or lay concrete on residential property for pay, in specific trades.

• When it applies: Same $600 threshold as the Residential Builder license.
• Good to know: The license lists the trades the holder is qualified for: carpentry, concrete, excavation, insulation work, masonry, siding, roofing, screens and storm sash, gutters, tile and marble, house wrecking, swimming pools, basement waterproofing. Applicants pick at least one trade but not all.

Residential Builder Company / M&A Company

Corporations, LLCs and partnerships. Sole proprietors may operate under an individual license.

• Good to know: An individual with an active Builder or M&A license must serve as the company's Qualifying Officer.

Residential Builder Salesperson

Salespeople who sell residential construction or improvement work for a licensed builder or contractor.

• Good to know: Contractors and their salespersons must carry a pocket card.

What you need to qualify

• Exams: Applicants must pass the state license exam (administered through PSI) after completing prelicensure education.
• Business registration: Corporations, LLCs and partnerships need a separate company license with a licensed Qualifying Officer. A physical Michigan business address is required (no P.O. boxes). Applicants with an out-of-state photo ID must file a notarized Consent to Service of Process.
• Also required: 60 hours of approved prelicensure education, with at least 6 hours each in business management/estimating/job costing, design and building science, contracts/liability/risk management, marketing and sales, project management and scheduling, the Michigan Residential Code, and MIOSHA construction safety standards. Veterans may request a waiver. Applicants must address any prior criminal convictions or civil judgments. Michigan has no reciprocity with other states.

Fees, renewal and continuing education

• Fees: Individual Residential Builder or M&A application: $195.00 (fee waived for eligible veterans). Relicensure (license expired more than three years): $185.00. Company license application: $195.
• Renewal: Licenses renew every 3 years.
• Continuing education: Licensed on or after January 1, 2009: 21 hours per 3-year cycle, with at least 3 hours each calendar year during the first 6 years, including 1 hour each on building codes and laws, safety, and changes in construction and business law. After 6 years (two cycles) with no discipline, or if originally licensed before January 1, 2009: 3 hours per cycle, 1 hour each on codes, safety and legal changes.

Contracts and homeowner protections

LARA's homeowner guidance says contracts should include the contractor's name, address and license number, detailed specifications and itemized costs, start and completion dates, permit responsibility, insurance and warranty terms, and payment terms, and that homeowners solicited at home have three days to cancel. Unlicensed builders and M&A contractors cannot sue to collect payment or enforce a construction lien for work done while unlicensed (MCL 339.2412).

Electrical, plumbing and HVAC work

Electrical, plumbing and mechanical (HVAC) contractors and tradespeople are licensed by the LARA Bureau of Construction Codes Licensing Section, the same office that licenses residential builders.

City and county rules

LARA licenses residential builders, not commercial builders. Municipalities may have additional requirements, and building permits and inspections are handled locally.

Working without a license

Acting as a residential builder or M&A contractor without a license is a misdemeanor: fine of $5,000 to $25,000 and up to 1 year in jail for a first offense, up to 2 years for repeat offenses, and a felony with up to 4 years if it causes death or serious injury (MCL 339.601(6)). A court may also assess a civil fine of $5,000 to $25,000 (MCL 339.2412(4)).

What to confirm with the state

We couldn't confirm these on an official page when we checked. Ask the licensing office before you rely on them:

• Standard 3-year renewal fee amount
• Whether any bond or liability insurance is required to hold the license (none is listed on the pages we checked)
• Statutory written contract requirements (the contract list above is LARA consumer guidance, not a confirmed statute)
• Homeowner Construction Lien Recovery Fund details

Sources

1. Bureau of Construction Codes - Licensing Section (LARA)
2. Residential Builders Frequently Asked Questions (LARA)
3. Maintenance & Alteration Contractor License Information (LARA)
4. Individual Residential Builder / M&A Contractor Application (BCC-2000)
5. Prelicensure Education Requirements (LARA)
6. Renewal & Continuing Competency Requirements (LARA)
7. MCL 339.2404b (continuing competency)
8. MCL 339.2412 (collection actions, civil fine)
9. MCL 339.601 (unlicensed practice penalties)
10. Helpful Information for Homeowners (LARA)