Why Licensing Matters
A contractor license is more than a piece of paper. It signals that the holder has met minimum competency requirements set by the state, carries required insurance or bonding, and is subject to a regulatory body that can discipline them for misconduct. Hiring an unlicensed contractor where a license is required exposes you to serious risk: if something goes wrong, you may have no legal recourse, your homeowner's insurance may deny the claim, and your property value can take a hit if work was done outside code.
Not every state requires licensing for every trade, and the rules vary significantly. Some states license general contractors at the state level, others delegate to counties or cities, and a handful have almost no licensing requirements at all. Specialty trades like electrical, plumbing, and HVAC nearly always require a license regardless of where you live, because the safety stakes are too high to leave unregulated.
Which Trades Typically Require a License
Electrical work, plumbing, HVAC, roofing, structural framing, demolition, and fire protection are licensed in the vast majority of states. General contracting and remodeling are licensed in many states but not all. Painting, landscaping, fencing, and cosmetic interior work often fall below the licensing threshold, though some municipalities still require registration or a business permit. The safest approach: before you hire anyone, check your state and local requirements. A five-minute search now prevents a five-figure problem later.
Step-by-Step: How to Look Up a License
Start by asking the contractor for their full legal business name and their license number. A legitimate contractor will provide this without hesitation. Then go directly to your state's contractor licensing board website. Every state that requires licensing maintains a public lookup tool. Search by license number first, because name searches can return multiple results or miss DBAs (doing-business-as names).
When the record comes up, confirm these details:
- License status: It should say "active," "current," or an equivalent term. Anything labeled "expired," "suspended," "revoked," or "inactive" is a disqualifier.
- Expiration date: Make sure the license won't lapse during your project. If it expires in two months and your project takes six, that's a problem.
- Classification: Confirm the license covers the type of work you need. A plumbing license doesn't authorize electrical work. A residential license may not cover commercial.
- Business name match: The name on the license should match the name on the contract and the name on the Certificate of Insurance. Mismatches are a red flag.
- Disciplinary history: Most state boards list complaints, investigations, fines, and formal actions. A single resolved complaint from years ago may not be disqualifying, but a pattern of violations is a hard stop.
What Scammers Fake
The most common tactic is showing you a screenshot or photocopy of a license that belongs to someone else. They may use a legitimate license number from a real contractor and hope you don't verify the name. Some will claim their license is "pending" or "being renewed," which in practice means they don't have one. Others will cite a general business registration (like an LLC filing or a DBA) as proof of licensing. A business registration is not a contractor license.
Another scam involves contractors who are licensed in one state claiming that license covers your state. Contractor licenses are state-specific. A California license means nothing in Texas. Always verify through your own state's system. If you encounter a contractor who gets defensive, evasive, or pushy when you ask to verify their license, walk away. Honest professionals welcome verification because it separates them from the bad actors.
What Disciplinary Actions Mean
State licensing boards have enforcement authority. If a contractor has been fined, had their license suspended, or been placed on probation, those records are usually public. A fine for a minor paperwork issue is different from a suspension for consumer fraud. Read the details. Look for patterns: multiple complaints about the same issue (abandoned projects, substandard work, insurance lapses) indicate systemic problems, not one-off mistakes.
If you find a serious disciplinary action, that contractor should not be on your shortlist. If you find a contractor operating without a required license, consider reporting it through our verification system so the pattern can be tracked and other homeowners can be warned. Documentation-based accountability protects everyone.
States Without Strong Licensing Requirements
Some states have minimal or no statewide general contractor licensing. In those areas, your due diligence shifts to other trust checks: verifying insurance, demanding written scopes, checking references, and using safe payment schedules. Even in states without licensing, specialty trades (electrical, plumbing) are almost always regulated. And local municipalities may require permits and registrations even when the state doesn't require a license.
What to Do After Verifying
Once you've confirmed the license is valid, current, and clean, move on to the next trust checks. Use the full verification checklist to confirm insurance, scope clarity, payment terms, and references. A valid license is necessary but not sufficient. It means the contractor met minimum standards. Whether they'll deliver quality work on your project depends on the rest of the trust wedge.
Keep a record of the license number, the date you verified it, and a screenshot of the lookup result. If a dispute arises later, this documentation matters. For a printable version of the full verification workflow, visit the Trust Library and grab the Hire-Safe Checklist.
Watch out for red flags in contractor estimates as the next step in your due diligence. A licensed contractor can still deliver a bad estimate, and the estimate is where most homeowner traps begin.
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