MHIC Business and Labor Practices 4

Question 1

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

Accepted Answer

3 years

Answer

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

Question 2

A homeowner pays a contractor a $5,000 deposit but the contractor fails to begin work within the agreed timeframe and stops responding. Which Maryland agency should the homeowner contact first?

Accepted Answer

Maryland Home Improvement Commission (MHIC)

Answer

The MHIC is the primary regulatory body that handles complaints against licensed home improvement contractors in Maryland.

Question 3

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

Accepted Answer

Abandoning a home improvement project without justification

Answer

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

Question 4

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

Accepted Answer

33%

Answer

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

Question 5

An MHIC licensee wants to add a partner to the business. Which step is required?

Accepted Answer

File a new license application listing the partner

Answer

Adding a new owner or qualifying party typically requires filing an updated license application with MHIC.

(MHIC) Maryland Home Improvement Contractor Practice Test

(MHIC) Maryland Home Improvement Contractor Practice Test

MHIC Business and Labor Practices 4