MHIC Knowledge 2

Question 1

Maryland's mechanics' lien law protects which parties from non-payment on home improvement projects?

Accepted Answer

Contractors, subcontractors, and material suppliers

Answer

Maryland's mechanics' lien law protects contractors, subcontractors, and material suppliers who have provided labor or materials to improve a property and have not been paid.

Question 2

Under Maryland Consumer Protection law, which of the following contractor actions would constitute an 'unfair or deceptive trade practice'?

Accepted Answer

Misrepresenting the materials to be used in a home improvement project

Answer

Misrepresenting materials to be used — for example, advertising premium materials but using lower-grade substitutes — is a deceptive trade practice under Maryland Consumer Protection law.

Question 3

A contractor working in Baltimore City installs new windows without obtaining a building permit. What are the potential consequences?

Accepted Answer

Stop-work order, fines, and potential requirement to remove or redo the work

Answer

Performing work without required permits can result in stop-work orders, fines, and requirements to remove or bring the work into compliance, at the contractor's expense.

Question 4

An MHIC contractor wants to have a lien on a homeowner's property released. What is the typical way this is accomplished?

Accepted Answer

Filing a lien release or satisfaction with the circuit court once paid

Answer

Once a mechanics' lien has been satisfied (paid), the contractor files a release or satisfaction of lien with the circuit court where the lien was filed. This clears the lien from the property's title.

Question 5

Under Maryland Home Improvement Law, a contractor who receives payment but intentionally fails to pay their subcontractors may be charged with:

Accepted Answer

Home improvement fraud

Answer

Intentionally withholding payment from subcontractors after receiving payment from the homeowner can constitute home improvement fraud under Maryland law.

(MHIC) Maryland Home Improvement Contractor Practice Test

(MHIC) Maryland Home Improvement Contractor Practice Test

MHIC Knowledge 2