MHIC Practice Test: Video 1 Answers (25 Questions) Flashcards

What does the Maryland Healthy Homes Protection Act require contractors to disclose to homeowners?

Answer: Presence of lead-based paint hazards in pre-1978 homes

Maryland law requires contractors to inform homeowners about lead-based paint hazards in homes built before 1978, consistent with EPA RRP rules.

Under Maryland law, a contractor who fails to obtain a required building permit before starting work may face:

Answer: Fines, stop-work orders, and potential license suspension

Unpermitted work in Maryland can result in fines, mandatory stop-work orders, and referral to the MHIC for license disciplinary action.

What is the maximum OSHA-allowed angle for positioning an extension ladder against a wall?

Answer: 1:4 ratio (one out for every four up)

OSHA requires extension ladders to be set at a 75-degree angle, which corresponds to a 1:4 ratio (one foot out for every four feet of height).

A Maryland home improvement contractor discovers asbestos-containing materials during a renovation. What is the correct first step?

Answer: Stop work and notify MDE before disturbing the material

The Maryland Department of the Environment (MDE) must be notified before any asbestos-containing material is disturbed during renovation or demolition.

What is the required minimum number of air changes per hour when applying solvent-based coatings indoors under OSHA ventilation standards?

Answer: 10 air changes per hour

OSHA requires at least 10 air changes per hour when spray-applying solvent-based coatings in enclosed spaces to prevent flammable vapor accumulation.

A Maryland contractor employs three full-time workers. Under Maryland law, which insurance coverage is mandatory?

Answer: Workers' compensation insurance

Maryland requires employers with one or more employees to carry workers' compensation insurance.

Under Maryland law, how long must a licensed MHIC contractor retain records of home improvement contracts?

Answer: 3 years

Maryland regulations require home improvement contractors to keep records of contracts and related documents for at least 3 years.

Which of the following is a valid reason for the MHIC to suspend a contractor's license?

Answer: Abandoning a home improvement project without justification

Abandoning a project without legal justification is grounds for license suspension or revocation by the MHIC.

How soon after starting business must a new MHIC licensee notify the Commission of their business address?

Answer: Within 30 days

Licensees must notify MHIC of their current business address within 30 days of any change.

What is the maximum deposit percentage that a Maryland home improvement contractor may legally collect before starting work?

Answer: 33%

Maryland law caps initial deposits at one-third (approximately 33%) of the total contract price.

Under Maryland law, what is the maximum civil penalty the MHIC can impose on an unlicensed contractor per violation?

Answer: $5,000

The MHIC may impose a civil penalty of up to $5,000 per violation on unlicensed contractors.

Which entity in Maryland has the primary authority to investigate complaints against home improvement contractors and revoke licenses?

Answer: Maryland Home Improvement Commission (MHIC)

The Maryland Home Improvement Commission (MHIC) is the primary regulatory body empowered to investigate complaints and revoke contractor licenses.

The Maryland Home Improvement Guaranty Fund is funded primarily by:

Answer: Fees paid by licensed contractors

The Guaranty Fund is financed through fees assessed on Maryland-licensed home improvement contractors.

Under Maryland's Home Improvement Law, a contractor must provide a written contract for any job costing more than:

Answer: $250

Maryland law requires a written contract for any home improvement job with a total price exceeding $250.

A subcontractor performs electrical work on a home improvement project in Maryland without being licensed. Who bears primary legal responsibility?

Answer: The general contractor who hired the subcontractor

The licensed general contractor is responsible for ensuring all subcontractors comply with Maryland licensing requirements.

Under Maryland regulations, which of the following must a home improvement contract include regarding payment schedule?

Answer: A clear payment schedule tied to project milestones or dates

Maryland home improvement contracts must specify a payment schedule, and law limits deposits to protect homeowners from contractors who collect money and disappear.

When calculating overhead costs in a job estimate, which of the following is an example of a fixed overhead expense?

Answer: Office rent

Fixed overhead expenses like office rent remain constant regardless of the number of projects, unlike direct job costs.

If a subcontractor is not paid by the general contractor, what Maryland legal remedy can the subcontractor use against the homeowner's property?

Answer: File a mechanic's lien

Under Maryland law, unpaid subcontractors and suppliers may file a mechanic's lien against the improved property within prescribed deadlines.

Under Maryland Home Improvement Law, what is the maximum number of days a homeowner has to cancel a home improvement contract after signing?

Answer: 3 business days

Maryland law grants homeowners a 3-business-day right of rescission for home improvement contracts signed at their residence.

Which contract clause protects a contractor if unforeseen site conditions (e.g., hidden mold or rot) substantially increase the project cost?

Answer: Unforeseen conditions clause

An unforeseen conditions clause allows the contractor to seek additional compensation when hidden defects materially change the scope of work.