1. Which of the following is required for a contractor to legally operate as a home
improvement contractor in Maryland?
a) A contractor’s license from the state of Maryland
b) A federal business license
c) Proof of general liability insurance
d) A Maryland Home Improvement Commission (MHIC) license
Answer: d) A Maryland Home Improvement Commission (MHIC) license
Rationale: A contractor must have an MHIC license to legally perform home improvement work
in Maryland. This license ensures that the contractor has met certain standards, including passing
an exam on Maryland’s regulations.
2. How often must a Maryland Home Improvement Contractor’s license be renewed?
a) Every 1 year
b) Every 2 years
c) Every 3 years
d) Every 5 years
Answer: b) Every 2 years
Rationale: The MHIC license must be renewed every 2 years. It’s important for contractors to
maintain their license to continue performing work legally.
3. What should a contractor do if they want to sub-contract part of their work to another
company?
a) Notify the homeowner
b) Only inform the Maryland Home Improvement Commission
c) Have the subcontractor apply for an MHIC license
d) Get written approval from the Maryland Home Improvement Commission
Answer: a) Notify the homeowner
Rationale: The contractor must inform the homeowner if they intend to subcontract work. While
subcontractors may need their own MHIC licenses, the homeowner must be kept in the loop.
,4. Which of the following must a contractor provide in writing before beginning work on a
project?
a) The project’s budget
b) A written contract detailing the scope of work
c) Proof of the contractor’s qualifications
d) A timeline for completion
Answer: b) A written contract detailing the scope of work
Rationale: Before starting work, contractors must provide a written contract that outlines the
work to be done, cost, and other terms. This protects both the contractor and the homeowner.
5. What is the maximum allowable deposit a contractor can require from a homeowner in
Maryland under the Home Improvement Law?
a) 25% of the contract price
b) 33% of the contract price
c) 50% of the contract price
d) 100% of the contract price
Answer: b) 33% of the contract price
Rationale: Maryland law limits the contractor's upfront deposit to 33% of the total contract
price. This protects homeowners from paying too much before work is completed.
6. Which of the following would NOT be considered home improvement work under the
MHIC regulations?
a) Installing a new roof
b) Painting the exterior of a home
c) Making repairs to the foundation
d) Installing new furniture in a home
Answer: d) Installing new furniture in a home
Rationale: Home improvement work generally involves construction, remodeling, or repair.
Installing furniture is not considered home improvement work.
, 7. What is the primary purpose of the Maryland Home Improvement Commission
(MHIC)?
a) To inspect contractors’ work
b) To ensure contractors comply with safety standards
c) To license and regulate home improvement contractors
d) To collect taxes from contractors
Answer: c) To license and regulate home improvement contractors
Rationale: The MHIC’s primary role is to regulate and license contractors, ensuring they meet
the necessary legal standards for working in Maryland.
8. What must a contractor do if they have a dispute with a homeowner regarding payment
for a completed job?
a) Sue the homeowner immediately
b) Contact the Maryland Home Improvement Commission
c) File a lien against the homeowner’s property
d) Discontinue work and leave the site
Answer: b) Contact the Maryland Home Improvement Commission
Rationale: The contractor should first try to resolve disputes with the homeowner. If that doesn’t
work, they can contact the MHIC for assistance or mediation.
9. Which of the following is a contractor’s responsibility regarding warranties on work
performed?
a) Warranties are not required by law
b) Provide a warranty for the materials but not the labor
c) Offer a written warranty for both labor and materials
d) Only provide warranties for jobs over $10,000
Answer: c) Offer a written warranty for both labor and materials
Rationale: Contractors are required to provide warranties in writing for both materials and labor,
ensuring the homeowner is protected.
10. What must a contractor include in the written contract with a homeowner?
improvement contractor in Maryland?
a) A contractor’s license from the state of Maryland
b) A federal business license
c) Proof of general liability insurance
d) A Maryland Home Improvement Commission (MHIC) license
Answer: d) A Maryland Home Improvement Commission (MHIC) license
Rationale: A contractor must have an MHIC license to legally perform home improvement work
in Maryland. This license ensures that the contractor has met certain standards, including passing
an exam on Maryland’s regulations.
2. How often must a Maryland Home Improvement Contractor’s license be renewed?
a) Every 1 year
b) Every 2 years
c) Every 3 years
d) Every 5 years
Answer: b) Every 2 years
Rationale: The MHIC license must be renewed every 2 years. It’s important for contractors to
maintain their license to continue performing work legally.
3. What should a contractor do if they want to sub-contract part of their work to another
company?
a) Notify the homeowner
b) Only inform the Maryland Home Improvement Commission
c) Have the subcontractor apply for an MHIC license
d) Get written approval from the Maryland Home Improvement Commission
Answer: a) Notify the homeowner
Rationale: The contractor must inform the homeowner if they intend to subcontract work. While
subcontractors may need their own MHIC licenses, the homeowner must be kept in the loop.
,4. Which of the following must a contractor provide in writing before beginning work on a
project?
a) The project’s budget
b) A written contract detailing the scope of work
c) Proof of the contractor’s qualifications
d) A timeline for completion
Answer: b) A written contract detailing the scope of work
Rationale: Before starting work, contractors must provide a written contract that outlines the
work to be done, cost, and other terms. This protects both the contractor and the homeowner.
5. What is the maximum allowable deposit a contractor can require from a homeowner in
Maryland under the Home Improvement Law?
a) 25% of the contract price
b) 33% of the contract price
c) 50% of the contract price
d) 100% of the contract price
Answer: b) 33% of the contract price
Rationale: Maryland law limits the contractor's upfront deposit to 33% of the total contract
price. This protects homeowners from paying too much before work is completed.
6. Which of the following would NOT be considered home improvement work under the
MHIC regulations?
a) Installing a new roof
b) Painting the exterior of a home
c) Making repairs to the foundation
d) Installing new furniture in a home
Answer: d) Installing new furniture in a home
Rationale: Home improvement work generally involves construction, remodeling, or repair.
Installing furniture is not considered home improvement work.
, 7. What is the primary purpose of the Maryland Home Improvement Commission
(MHIC)?
a) To inspect contractors’ work
b) To ensure contractors comply with safety standards
c) To license and regulate home improvement contractors
d) To collect taxes from contractors
Answer: c) To license and regulate home improvement contractors
Rationale: The MHIC’s primary role is to regulate and license contractors, ensuring they meet
the necessary legal standards for working in Maryland.
8. What must a contractor do if they have a dispute with a homeowner regarding payment
for a completed job?
a) Sue the homeowner immediately
b) Contact the Maryland Home Improvement Commission
c) File a lien against the homeowner’s property
d) Discontinue work and leave the site
Answer: b) Contact the Maryland Home Improvement Commission
Rationale: The contractor should first try to resolve disputes with the homeowner. If that doesn’t
work, they can contact the MHIC for assistance or mediation.
9. Which of the following is a contractor’s responsibility regarding warranties on work
performed?
a) Warranties are not required by law
b) Provide a warranty for the materials but not the labor
c) Offer a written warranty for both labor and materials
d) Only provide warranties for jobs over $10,000
Answer: c) Offer a written warranty for both labor and materials
Rationale: Contractors are required to provide warranties in writing for both materials and labor,
ensuring the homeowner is protected.
10. What must a contractor include in the written contract with a homeowner?
