How to Get a Contractor’s License in Michigan

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Surety Bond Professionals is a family-owned and operated bonding agency with over 30 years of experience. With access to a broad range of surety markets, our expert agents are ready to assist with all of your Michigan contractor license bond needs. Learn how to get a contractor’s license in Michigan, below.

What Contractor Licenses Are Issued in Michigan?

If you want to work in Michigan as a general contractor on projects valued at more than $600, you will need to obtain one of the following licenses:

  • Residential builder’s license
  • Residential maintenance and alteration contractor

These licenses are issued by the Michigan Department of Licensing and Regulatory Affairs. Certain municipalities have their own licensing requirements for commercial contractors.

What Are the Steps in the Licensing Process?

In general, these are the major steps in the licensing process at the state level:

  • Complete 60 hours of mandatory pre-licensing education.
  • Complete the application for the type of license you’re seeking.
  • Submit the completed application along with the certificate of completion of the education requirements, a copy of your driver’s license or state-issued ID card, and the license fee (currently $195 for an initial license) to LARA.
  • Upon LARA’s approval, take the Residential Builder or Maintenance and Alteration Contractor exam.
  • You’ll receive your license in the mail after you have passed the exam.

If you will be working in a jurisdiction that requires a local license, you’ll need to find out what additional requirements may apply. In many cases, local licensing authorities require contractors to purchase a Michigan contractor’s license bond.

Why is a Contractor License Bond Required?

A Michigan contractor’s license bond is a surety bond that you purchase as your guarantee to abide by all applicable state laws and local ordinances. The bond makes you responsible for paying any claim filed against the bond by a party who has suffered a financial loss due to your unlawful or unethical conduct as a locally licensed contractor.

The required bond amount, known as the bond’s “penal sum” and the term of the bond are established by the specific municipality in its role as the bond’s “obligee.”

How Are Oregon Contractor License Bond Claims Paid?

The surety bond agreement forms a legally binding contract between the obligee requiring the bond, the contractor (the “principal”) purchasing the bond, and the bonding company (the “surety”) approving the bond. The terms of that agreement make you, the principal, solely responsible for paying valid claims against the bond.

If you don’t pay a claim within a reasonable period of time, the surety will step in and pay it for you, but you are then legally obligated to reimburse the surety.

How Much Does a Michigan Contractor License Bond Cost?

Your annual premium for a Michigan contractor bond will be a small percentage of the required bond amount set by the obligee. The surety will assign you a premium rate based on its assessment of the risk that would be involved in extending credit to you by paying claims on your behalf. The main factor considered is your personal credit score.

With a good credit score (650 or higher), your premium rate will most likely be in the range of 1-3% of the required bond amount.

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Our surety bond professionals will get you the Michigan contractor license bond you need at a competitive rate.