Maryland Home Improvement Practice Test PSI
Official Exam 2026/2027 Actual Exam Complete
Questions and Answers Detailed Rationales Pass
Guaranteed - A+ Graded
TABLE OF CONTENTS
Section 1 | Maryland Home Improvement Laws and Regulations | Q1 – Q10
Section 2 | Contract Requirements and Consumer Protection | Q11 – Q20
Section 3 | Licensing and Permit Procedures | Q21 – Q30
Section 4 | Business Practices and Financial Management | Q31 – Q40
Section 5 | Safety Standards and Construction Fundamentals | Q41 – Q50
Instructions: Choose the single best answer. Pass: 80% in 90 minutes.
══════════════════════════════════════
SECTION 1: MARYLAND HOME IMPROVEMENT LAWS AND REGULATIONS Q1 – Q10
══════════════════════════════════════
Question 1 of 50
A homeowner in Baltimore County hires a contractor to build a $45,000 rear addition on
her single-family home. The contractor advertises on social media but never displays an
MHIC license number in the ads. Under Maryland Business Regulation Article, Title 8,
this omission is:
A. Acceptable if the contractor includes the license number in the written contract only
B. A minor paperwork issue that carries no penalty
C. A violation because the license number must appear in all advertising and
solicitations ✓ CORRECT
D. Required only for contracts over $75,000
,Correct Answer: C
Rationale: Maryland law requires a licensed contractor's MHIC number to appear in all
advertising, solicitations, and proposals to allow consumers to verify licensure before
engaging services. Choice A is incorrect because the statute mandates disclosure in
advertising, not just the final contract. Failing to display the license number can result in
disciplinary action and fines.
Question 2 of 50
A 68-year-old homeowner in Montgomery County signs a home improvement contract
in his living room with a salesperson who knocked on his door. The contract involves
installing new vinyl siding for $28,000. Under the Maryland Door-to-Door Sales Act, the
homeowner has the right to cancel this contract without penalty until:
A. Midnight of the third business day after signing
B. Midnight of the fifth business day after signing ✓ CORRECT
C. Midnight of the seventh business day after signing
D. Midnight of the tenth business day after signing
Correct Answer: B
Rationale: The Maryland Door-to-Door Sales Act grants buyers the right to cancel a
door-to-door sale until midnight of the fifth business day after the transaction, with an
extended seventh-business-day period for buyers aged 65 and older. Choice C describes
the extended period for senior buyers, which does not apply to this 68-year-old under the
standard Act. The cancellation notice must be provided in writing, and the seller must
return any deposit within ten business days.
Question 3 of 50
A contractor completes a $12,000 kitchen remodel for a homeowner in Anne Arundel
County. The homeowner is dissatisfied with the countertop installation and files a claim
,with the MHIC Guaranty Fund after the contractor abandons the job. The maximum
amount the Guaranty Fund may pay for a single eligible claim is generally:
A. $5,000 per claimant
B. $10,000 per claimant
C. $20,000 per claimant ✓ CORRECT
D. $50,000 per claimant
Correct Answer: C
Rationale: The Maryland Home Improvement Guaranty Fund compensates homeowners
for actual losses caused by licensed contractors, with claims generally capped at
$20,000 per claimant. Choice D reflects amounts sometimes seen in other state
programs or surety bonds but not the MHIC Guaranty Fund limit. The contractor remains
liable to repay the Fund for any amounts paid out on their behalf.
Question 4 of 50
A contractor is performing roofing work on a townhouse in Prince George's County. A
neighbor asks the crew to repair his detached garage roof for $3,500 cash. The
contractor agrees and begins work without a written contract. Under Maryland law, this
arrangement:
A. Is permissible because the job is under $5,000
B. Violates the requirement for a written contract for home improvement contracts of
$500 or more ✓ CORRECT
C. Is legal because garages are exempt from home improvement law
D. Requires only a verbal agreement if paid in cash
Correct Answer: B
Rationale: Maryland law requires a written contract for any home improvement contract
of $500 or more, regardless of whether the structure is a primary residence or
accessory building. Choice A confuses the threshold with license financial requirements
or other states' limits. Verbal agreements for home improvement work leave both
, parties without enforceable documentation and expose the contractor to disciplinary
action.
Question 5 of 50
A homeowner in Howard County discovers that the contractor she hired to finish her
basement is not licensed with the MHIC. The contractor demands final payment of
$8,500. Under Maryland Business Regulation Article, Section 8-601, the homeowner's
best legal protection is that:
A. She must pay the full amount to avoid a mechanics lien
B. The contract may be unenforceable by the unlicensed contractor ✓ CORRECT
C. She can only withhold 10% of the contract price
D. The contractor can file a Guaranty Fund claim against her
Correct Answer: B
Rationale: Contracts entered into by unlicensed contractors may be declared
unenforceable in Maryland courts, meaning the contractor cannot legally compel
payment. Choice A is incorrect because an unlicensed contractor's lien rights are
severely compromised, and the homeowner has significant leverage. Working without
an MHIC license is a misdemeanor that can result in fines and imprisonment.
Question 6 of 50
A salesperson licensed with the MHIC solicits a $55,000 deck project for a licensed
contractor in Carroll County. The homeowner asks the salesperson to sign the contract.
Under Maryland regulations, the written contract must include:
A. Only the contractor's name and license number
B. The name and license number of both the contractor and the salesperson if the
salesperson solicited the work ✓ CORRECT
C. The salesperson's home address and Social Security number
D. Only the contractor's information because salespeople are not parties to the contract
Official Exam 2026/2027 Actual Exam Complete
Questions and Answers Detailed Rationales Pass
Guaranteed - A+ Graded
TABLE OF CONTENTS
Section 1 | Maryland Home Improvement Laws and Regulations | Q1 – Q10
Section 2 | Contract Requirements and Consumer Protection | Q11 – Q20
Section 3 | Licensing and Permit Procedures | Q21 – Q30
Section 4 | Business Practices and Financial Management | Q31 – Q40
Section 5 | Safety Standards and Construction Fundamentals | Q41 – Q50
Instructions: Choose the single best answer. Pass: 80% in 90 minutes.
══════════════════════════════════════
SECTION 1: MARYLAND HOME IMPROVEMENT LAWS AND REGULATIONS Q1 – Q10
══════════════════════════════════════
Question 1 of 50
A homeowner in Baltimore County hires a contractor to build a $45,000 rear addition on
her single-family home. The contractor advertises on social media but never displays an
MHIC license number in the ads. Under Maryland Business Regulation Article, Title 8,
this omission is:
A. Acceptable if the contractor includes the license number in the written contract only
B. A minor paperwork issue that carries no penalty
C. A violation because the license number must appear in all advertising and
solicitations ✓ CORRECT
D. Required only for contracts over $75,000
,Correct Answer: C
Rationale: Maryland law requires a licensed contractor's MHIC number to appear in all
advertising, solicitations, and proposals to allow consumers to verify licensure before
engaging services. Choice A is incorrect because the statute mandates disclosure in
advertising, not just the final contract. Failing to display the license number can result in
disciplinary action and fines.
Question 2 of 50
A 68-year-old homeowner in Montgomery County signs a home improvement contract
in his living room with a salesperson who knocked on his door. The contract involves
installing new vinyl siding for $28,000. Under the Maryland Door-to-Door Sales Act, the
homeowner has the right to cancel this contract without penalty until:
A. Midnight of the third business day after signing
B. Midnight of the fifth business day after signing ✓ CORRECT
C. Midnight of the seventh business day after signing
D. Midnight of the tenth business day after signing
Correct Answer: B
Rationale: The Maryland Door-to-Door Sales Act grants buyers the right to cancel a
door-to-door sale until midnight of the fifth business day after the transaction, with an
extended seventh-business-day period for buyers aged 65 and older. Choice C describes
the extended period for senior buyers, which does not apply to this 68-year-old under the
standard Act. The cancellation notice must be provided in writing, and the seller must
return any deposit within ten business days.
Question 3 of 50
A contractor completes a $12,000 kitchen remodel for a homeowner in Anne Arundel
County. The homeowner is dissatisfied with the countertop installation and files a claim
,with the MHIC Guaranty Fund after the contractor abandons the job. The maximum
amount the Guaranty Fund may pay for a single eligible claim is generally:
A. $5,000 per claimant
B. $10,000 per claimant
C. $20,000 per claimant ✓ CORRECT
D. $50,000 per claimant
Correct Answer: C
Rationale: The Maryland Home Improvement Guaranty Fund compensates homeowners
for actual losses caused by licensed contractors, with claims generally capped at
$20,000 per claimant. Choice D reflects amounts sometimes seen in other state
programs or surety bonds but not the MHIC Guaranty Fund limit. The contractor remains
liable to repay the Fund for any amounts paid out on their behalf.
Question 4 of 50
A contractor is performing roofing work on a townhouse in Prince George's County. A
neighbor asks the crew to repair his detached garage roof for $3,500 cash. The
contractor agrees and begins work without a written contract. Under Maryland law, this
arrangement:
A. Is permissible because the job is under $5,000
B. Violates the requirement for a written contract for home improvement contracts of
$500 or more ✓ CORRECT
C. Is legal because garages are exempt from home improvement law
D. Requires only a verbal agreement if paid in cash
Correct Answer: B
Rationale: Maryland law requires a written contract for any home improvement contract
of $500 or more, regardless of whether the structure is a primary residence or
accessory building. Choice A confuses the threshold with license financial requirements
or other states' limits. Verbal agreements for home improvement work leave both
, parties without enforceable documentation and expose the contractor to disciplinary
action.
Question 5 of 50
A homeowner in Howard County discovers that the contractor she hired to finish her
basement is not licensed with the MHIC. The contractor demands final payment of
$8,500. Under Maryland Business Regulation Article, Section 8-601, the homeowner's
best legal protection is that:
A. She must pay the full amount to avoid a mechanics lien
B. The contract may be unenforceable by the unlicensed contractor ✓ CORRECT
C. She can only withhold 10% of the contract price
D. The contractor can file a Guaranty Fund claim against her
Correct Answer: B
Rationale: Contracts entered into by unlicensed contractors may be declared
unenforceable in Maryland courts, meaning the contractor cannot legally compel
payment. Choice A is incorrect because an unlicensed contractor's lien rights are
severely compromised, and the homeowner has significant leverage. Working without
an MHIC license is a misdemeanor that can result in fines and imprisonment.
Question 6 of 50
A salesperson licensed with the MHIC solicits a $55,000 deck project for a licensed
contractor in Carroll County. The homeowner asks the salesperson to sign the contract.
Under Maryland regulations, the written contract must include:
A. Only the contractor's name and license number
B. The name and license number of both the contractor and the salesperson if the
salesperson solicited the work ✓ CORRECT
C. The salesperson's home address and Social Security number
D. Only the contractor's information because salespeople are not parties to the contract
