How To Become a Remodeling Contractor

Remodeling contractors are specialists that renovate, expand, and restore existing buildings.

According to the U.S. Bureau of Labor Statistics, the median pay for remodeling contractors ranges from $37,000 to $70,000. Furthermore, this is a highly sought-after profession as homeowners are always in need of restoring, building, and expanding their properties. 

If you're thinking about becoming a remodeling contractor, this guide will walk you through the steps to make your dream a reality.

Who Must Have a Home Improvement Contractor License?

Anyone who plans to undertake construction projects, specifically remodeling and home improvements, must have a home improvement contractor license. These professionals may be involved in structural changes, additions, renovations, and repairs of buildings.

Obtain Necessary Education

Education forms the foundation for a career in remodeling:

• Start by earning a high school diploma. Some high schools offer vocational training in areas like carpentry, masonry, electrical repair, and plumbing.
• You can also opt to earn an associate's or bachelor’s degree. Degrees in engineering, architecture, and construction management can be beneficial. 

Consider Formal Education

If you're looking to gain a competitive edge or if your state requires it for licensing, consider formal education. 

A degree in areas like project management, planning, or construction management can be valuable. These educational paths can provide you with knowledge about the non-technical aspects of running a remodeling contractor business.

Gain Hands-On Experience

Many remodeling contractors start as apprentices under experienced professionals. This hands-on training could last for several years. Some states require a certain amount of practical experience before granting a license or certification.

You could also gain experience by working as an assistant to a licensed contractor. This helps you learn the technical skills needed to operate independently and understand the business, problem-solving, and project management aspects of contracting.

Acquire Your License

Obtaining a contractor’s license is a multi-step process:

1. Apply for a license with the relevant state contractor board.
2. Pass the licensing examination.
3. Clear a criminal background check.
4. Provide proof of being bonded and having contractor’s insurance, if required by your state.

Set Up Your Business

Once you've obtained your license, you can set up your business:

1. Create a business plan outlining your business name, target market, and startup costs.
2. Obtain necessary licenses, such as a business license and contractor’s license.
3. Formalize your business by setting up a limited liability corporation (LLC).
4. Make sure your business name is unique and not already trademarked.
5. Purchase necessary tools and materials and consider joining local builders’ or remodelers’ associations.
6. Promote your business through referrals, internet ads, your website, and social media profiles.

Get Bonded and Insured

In addition to being licensed, most states require that remodeling contractor support be bonded and insured. This involves getting a general business, liability, and workers’ compensation insurance policy.

You'll also need extra coverage in the form of a bond. A bond is an additional security level that ensures payment in case of damage not covered by your business insurance.

Home Improvement Contractor License Requirements by State [Guide]

Below we take a look at home improvement contractor license requirements in different states:

Alabama

• Home improvement contractors in Alabama need to show proof of a license based on the project they are undertaking.
• Industrial and commercial jobs estimated to cost at least $50,000, or residential jobs estimated to cost $10,000 or more require a license.
• For swimming pools, anything over an estimated $5,000 requires a license.

Alaska

• In Alaska, home improvement contractors need to successfully pass the Alaska Craftsman Home Program or show proof of having completed post-secondary Arctic engineering.
• Alaska requires a separate license for home and commercial contracting work.
• Handyman contractors may work on projects with an aggregate contract of $10,000 or less for each project.

Arizona

• If labor and materials exceed $1,000 or a permit is required, a license is needed.
• The work related to electrical, plumbing, air conditioning systems, boilers, swimming pools, spas, and water wells must be subcontracted to an appropriately licensed contractor.
• For projects that cost more than $750, professionals must have a license.

Arkansas

• In Arkansas, if the job costs less than $2,000, a license is not needed.

California

• For most projects that cost more than $500 in California, the contractor must have a license - in most cases, as a residential remodeling contractor.

Colorado

• Colorado’s contractors’ licenses are administered at the local level rather than the state level.
• Contractors must obtain a business license, which is different from a contractor’s license.

Connecticut

• You perform work on residential property (single or multi-family dwellings of six units or less), condominiums, or common interest communities. 

Delaware

• Delaware law defines contractors as “every person engaged in the business of Furnishing labor or both labor and materials in connection with all or any part of the construction, alteration, repairing, dismantling or demolition of buildings, structures, driveways, roads, bridges, viaducts, sewers, water and gas mains and every other type of structure as an improvement, alteration or development of real property.”
• Delaware is a small state and has several license requirements for those living outside the state.
• Out-of-state contractors also need to post a surety bond.

Florida

• In Florida, contractors may choose between registered and certified licenses to work in compliance with State Law.
• Contractors’ license applicants must show proof of four years of work experience demonstrating experience in the field corresponding to the license applied for.
• These include the Florida General Contractor License and the Residential Contractor License.

Georgia

• Unlike other states, contractors need to comply with a series of highly specific requirements to work legally in Georgia.
• A license is needed for work on single-family or two-family homes or townhomes costing over $2,500.
• Contractors must pass a business and law assessment to gain certification.

Hawaii

• Like most states, the Hawaii Department of Commerce and Consumer Affairs Professional and Vocational Licensing Division requires contractors to have a license for projects exceeding a cost threshold.

Idaho

• Contractors who perform work over $2,000 must register with the State of Idaho.
• 54-5203, Idaho Code defines a contractor as: "Any person who in any capacity undertakes, offers to undertake, purports to have the capacity to undertake, or submits a bid to, or does himself or by or through others, perform construction.

Illinois

• Contractor licensing is typically handled at the local level.
• No state-level license is required except for plumbing and roofing contractors.

Indiana

• Like Illinois, Indiana handles contractors’ licenses at the local level.

Iowa

• Contractors earning at least $2,000 a year from construction must register with the Iowa Division of Labor and renew annually.

Kansas

• Kansas is another state that issues contractors' licenses at the local level rather than at the state level.

Kentucky

• Only electrical, HVAC, and plumbing contractors are licensed at the state level.
• There's a mutual reciprocity license agreement between Kentucky, Ohio, Louisiana, Virginia, and West Virginia.

Louisiana

• For projects exceeding $7,500, professionals need a regular license; over $75,000 requires a residential license.
• Applicants must have a net worth of at least $10,000, complete a course in business law, and pass an exam.

Maine

• Home/residential contractors are not licensed at the state level.
• State-level licensing applies only to plumbers, asbestos abatement professionals, and electrical contractors.

Maryland

• Contractors need at least two years of home improvement work experience.
• Provide proof of current $50,000 liability insurance.

Massachusetts

• General contractors must obtain a Construction Supervisor License.

Michigan

• All home improvement professionals need to hold a license.
• Licensing is managed by the Licensing and Regulatory Affairs of Michigan.

Minnesota

• Contractors who offer work in multiple skill areas need a residential building contractor or remodeler license.
• License applicants must appoint a "qualifying person" (QP) to fulfill requirements.
• Contractors declaring over $15,000 must have a Contractors’ and Remodelers’ License.

Mississippi

• All types of home improvement projects require a license, except for small ones.

Missouri

• Licensing is done at the municipal level.
• Contractors wishing to work in multiple municipalities need a license for each.

Montana

• All construction professionals must sign up at the state level.
• Those with employees must apply for a construction contractors’ license; those without must get an independent contractors’ license.

Nebraska

• Contractors and subcontractors must register with the Nebraska Department of Labor.
• They must provide a current Workers’ Compensation Certificate of Insurance.

Nevada

• Contractors must have a license, except for some jobs under $1,000.
• The license costs $300 to obtain.

New Hampshire

• Contractors' licenses are managed at the local level.
• State-level licenses are only for electrical, plumbing, asbestos, and lead abatement contractors.

New Jersey

• Home repair contractors must have a license for financed home repair contracts.
• Contractors dealing strictly in cash installment payments over 90 days or less or accepting credit card payments do not need this license.
• All home repair contractors must contact the NJ Division of Consumer Affairs concerning required registration.

New Mexico

• Contractors must secure a license from the board before operating.

New York

• Home improvement contractor licensing is handled at the local/municipal level.
• Contractors should check with the local government for specific licensing information.

North Carolina

• General contractors must have a license for projects over $30,000.
• Application for the license can be downloaded from www.nclbgc.org.
• Professionals in electricity, plumbing, HVAC, and fire sprinkling services also need a license.

North Dakota

• Contractors must be bonded, insured, and hold a license for any project worth more than $4,000.
• License classes available are A, B, C, or D, with Class D allowing jobs worth up to $100,000 each.

Ohio

• State-level licenses are issued for refrigeration, HVAC, plumbing, and electrical projects.
• For all other projects, licenses are at the local level.

Oklahoma

• Residential contractor licenses are issued at the local level.
• Check with your city or county officials for specific requirements.

Oregon

• Everyone in the construction industry needs a license, with few exceptions.
• Contractors must have surety bonds, liability insurance, and workers' compensation insurance.

Pennsylvania

• There are no licensure or certification requirements for most construction contractors.
• However, most home improvement contractors must register with the Attorney General's Office.

Rhode Island

• Contractors must register with the Contractors Registration and Licensing Board for projects related to home construction, commercial construction, remodeling, home repair, and alteration.
• Commercial roofing contractors have a separate requirement.

South Carolina

• The state licenses mechanical and general contractors for commercial, industrial, and residential projects.
• Contractors working exclusively on residential projects must go through the Residential Builders Commission and sit for an exam.

South Dakota

• The state does not issue contractors’ licenses.
• All general contractors' licenses are handled at the local level.

Tennessee

• A contractor’s license is mandatory for all projects that exceed $25,000.
• Projects that include plumbing, electrical work, and HVAC must be done by a licensed professional, irrespective of the project cost.

Texas

• HVAC, electrical, plumbing, and pump installation specialists need a state-issued license.

Utah

• All professional contractors must have a license.
• Two types of licenses: specialty contractors and general contractors
• Various ways to satisfy the experience requirement

Vermont

• General contractors do not need to be licensed by the state.
• Plumbing, electrical, and HVAC experts need to bear credentials sealed by the state.

Virginia

• The Virginia Board for Contractors regulates individual contractors. 

Washington

• Both special and general pros need to register with the Washington State Department of Labor and Industries.

Washington DC

• Both general contractors and construction managers need to get a license through the Department of Consumer and Regulatory Affairs.

West Virginia

• Contractors need to have a license if the project costs more than $2,500.

Wisconsin

• The Wisconsin Department of Safety and Professional Services issues contractor licenses.
• To work on one- or two-family homes, Wisconsin requires the dwelling contractor certification business certificate and that at least one person from the company has a dwelling contractor certification.

Wyoming

• The only professionals within the home industry that require a state-issued license are electricians.

Bottom Line

Becoming a remodeling contractor is a rewarding career path that involves a mix of hands-on work and strategic business management. 

Education, hands-on experience, obtaining your license, setting up your business, and getting bonded and insured form the bedrock of your journey toward becoming a successful remodeling contractor. 

However, you must also take into consideration the specific requirements and regulations set by your state for licensing and practice. Always ensure to keep up with the laws and updates in your location. 

With these in place, you can establish a fruitful and sustainable career in remodeling and contribute positively to the construction industry.