Legal Aspects Involved In Working with Licensed Contractors Near Me
Hiring a contractor who is licensed and insured helps to keep you protected against any financial liabilities should any of their workers become injured while working on site.
If you are confused on when and if the company you will hire for your construction and remodeling needs should hold a license, then you are not alone. A lot of homeowners are often not familiar on the legalities involved when it comes to dealing with these professionals.
Each and every state in the US comes with its own set of rules and regulations on contractor licensing. A majority of the states have regulated at least a few home repair related projects, but some of the states do not do so. In addition, some cities, states and municipalities have required having licenses for certain trades, but many do not.
In general, a contractor’s license will usually involve a registration with the license issuing authority and will require proving that the contractor will hold the minimum boding or insurance required by the state or municipality. In most cases, a license will be required as some sort of a preliminary requirement in order for the contractor to be able to obtain a permit at the state’s local building department.
In some municipalities and states, the minimum threshold for acquiring a license is often based on the amount or the value of the project. For instance, in the city of New York, any of the home improvement work that will cost more than $200 will be required in order to be performed by the home improvement professional.
Hiring a licensed professional is therefore a good idea since the license is a proof that they have met the minimal requirement for such line of work as needed by the jurisdiction. A lot of states will require that the contractors provide a proof of insurance as part of acquiring a trade license or registration.
Registration or licensing will keep the homeowner protected by helping to ensure that the professionals will be able to meet with the minimum requirements needed for insurance. Working with an unlicensed contractor could cost you money in so many ways.
If your project will require the need for a building permit, however, the contractor has failed to acquire one since they are not licensed, the building inspector could request for the work to be stopped until he or she will be satisfied that the necessary permits have been obtained.
Homeowners who hire an unlicensed company might also find a few recourse if a problem will ensue right after the project is completed. In various states in the US, for instance, in Arizona, registered contractors will contribute to a compensation fund that will seek to make wronged customers whole if in the event that a problem will develop when working with them.
Licensing for Trades
Acquiring a trade specific license will generally mean that the tradesman has finished the minimum number of working hours working as an apprentice on that specific trade and that they have passed the standardized written test that is based on their trade. Moreover, the license could also mean that they have completed the continuing education courses in order to get their license renewed.
However, it is important to note that each municipality and state in the US will often handle the trade licensing in a different way. For instance, almost every state in the US will provide license on plumbers, except for Nebraska, Missouri, Kansas, Wyoming, Pennsylvania and New York. The states also have individual cities that will require for the plumber to be licensed at a local level. All these differences underscore the need to verify your local regulations on trade licensing before you search for potential licensed contractors near me.
What is Bonding?
In most states, general contractors have to be bonded before they can be given a license. Generally, this could mean that the contractor should obtain a surety bond and this will serve as a form of insurance to keep the customers protected if they were unable to complete the job or if they fail to obtain permits.
The bonding requirements will vary from one state to another and even from one city to another, so it is your best interest as a consumer to know the rules on the area you live. At a state level, there is often a board or agency that has a professional licensing on its name or description of its responsibilities. The licensing agencies will also be able to answer questions regarding the state requirements on bonding. At the city or county level, the requirements for bonding might be a department that is responsible for the consumer or commerce affairs.
A lot of homeowners do not realize that the bond also protects them from being faced with unpaid supply bill or the cost of the unpaid workers in a project. In addition, the bond could cover any damages on the property resulting from the contractor’s negligence or in a more serious circumstance, stolen or lost property.
The agency that will be involved in the bond is often a surety company that will require for the contractor to pay for the regular premiums in order for the bond to be renewed. Such premiums are factored in the same way as that of the insurance plans and they take into consideration the company’s work history and the amount that the bond can cover as well.
In order to be given a monetary compensation for unsatisfactory performance, the homeowner will need to get in touch with the surety company and then provide proof that the project is incomplete or that the company has failed to pay for the materials and other obligations that are their own responsibility.
The bonds will not only benefit the homeowner, but the contractor as well since most people will not hire those that does not offer protection of a bond. A lot of subcontractors and suppliers will only deal with a contractor that has a bond in place.
In order to know if your contractor is bonded or not, it is best to request for a bond certification. You must take extra precaution in order to ensure that both the license and the bond are not expired. Remember that without a bond or insurance, you could end up paying a lot of money from your pocket if in case your homeowner’s policy will not be sufficient to cover the bills in case the contractor gets injured in an accident while working in your property.
Any company that you will hire for a construction or remodeling project should be licensed, bonded and insured. When you interview prospective companies, request to see their Certificate of Insurance and contact the insurance company in order to verify if such policy is still up to date.
You should also check if the coverage of such policy would be enough to keep you protected in case something happens while they are working on your project. Do not just take their word for it. Do your research as well and ask for proof.