Michigan Contractor Licensing Guide: How to Get Licensed by Trade
In Michigan, most construction contractors must register with the Michigan Bureau of Construction Codes (BCC) under the Michigan Occupational Code. Unlike many states, Michigan does not issue a single 'contractor license'—instead, it requires trade-specific registration for residential builders, maintenance & alteration contractors, and specialized trades like electrical, plumbing, and mechanical work. Small business owners must comply with bonding, insurance, and experience requirements before legally bidding or performing work.
License Categories and Who Must Register
Michigan mandates registration—not licensure—for three primary contractor categories: Residential Builder, Maintenance & Alteration (M&A) Contractor, and Specialty Contractors (e.g., electricians, plumbers, HVAC technicians). Residential Builders must register if they construct, alter, or repair residential structures (1–4 units), including site work and foundations. M&A Contractors handle remodeling, repairs, or additions to existing residential buildings but cannot perform new construction. Specialty contractors must hold separate state licenses through the Michigan Department of Licensing and Regulatory Affairs (LARA) in addition to BCC registration where applicable. Sole proprietors, LLCs, and corporations all require registration; unregistered activity is a civil infraction punishable by fines up to $5,000 per violation. Note: General contractors who only manage projects without performing hands-on work may be exempt—but only if they do not directly employ workers or control job-site safety. Registration is mandatory before advertising, bidding, or signing contracts for covered work. The BCC maintains an online registry searchable by name or license number, and all registrants must display their registration number on vehicles, proposals, and advertisements.
Bond and Insurance Requirements
All Michigan Residential Builder and M&A Contractor registrants must post a $15,000 surety bond issued by a licensed surety company authorized to operate in Michigan. The bond must name the State of Michigan as obligee and remain continuously in force throughout registration. It protects consumers against financial loss due to fraud, defective workmanship, or failure to complete contracted work. In addition, registrants must carry minimum general liability insurance: $300,000 per occurrence and $600,000 aggregate for Residential Builders; $100,000 per occurrence and $200,000 aggregate for M&A Contractors. Workers’ compensation insurance is mandatory if the contractor employs staff—even one part-time worker—and must comply with Michigan’s Workers’ Disability Compensation Act. Proof of both bond and insurance must be submitted electronically via the MiWAM portal at time of initial registration and renewal. Certificates must list the registrant’s full legal business name and registration number, and insurers must file electronic notifications of cancellation at least 30 days in advance. Failure to maintain valid coverage results in automatic suspension of registration and potential disciplinary action by the BCC.
Experience, Exams, and Application Process
Applicants for Residential Builder or M&A Contractor registration must document at least three years of full-time construction-related experience within the last ten years—verified via employer affidavits, tax records, or project documentation. No formal education substitute is accepted. All applicants must pass the Michigan Residential Contractor Examination administered by PSI Services LLC, covering business management, contract law, building codes (IBC/IRC), safety, and Michigan-specific statutes. The exam is open-book for code references but closed-book for business and legal content; candidates must score at least 75% to pass. Applications are submitted exclusively online through the Michigan Web Account Manager (MiWAM); paper applications are no longer accepted. Required documents include completed application form, $185 non-refundable fee, bond and insurance certificates, experience verification, and a background check consent form. Fingerprint-based criminal history review is mandatory for all owners, officers, and qualifying agents. Processing typically takes 10–15 business days after all materials are received and verified. First-time applicants should schedule the exam early, as PSI test center slots fill quickly—especially in Detroit, Grand Rapids, and Lansing metro areas.
Renewal, Compliance, and Enforcement
Michigan contractor registrations expire biennially on April 30 of odd-numbered years (e.g., 2025, 2027) and must be renewed online via MiWAM no earlier than 90 days before expiration. Renewal requires updated bond and insurance certificates, payment of a $185 fee, and affirmation of continued compliance with experience, insurance, and bonding requirements. Registrants must also complete two hours of approved continuing education every renewal cycle—one hour on Michigan construction law and one hour on building code updates—through BCC-accredited providers. Late renewals incur a $50 penalty and risk lapse; registrations inactive for over 180 days require reapplication and retesting. The BCC actively investigates consumer complaints and conducts random audits; violations—including working without registration, misrepresenting qualifications, or failing to maintain insurance—may result in civil penalties, mandatory restitution, or referral to the Attorney General for injunctive relief. Contractors must retain all project records, contracts, and insurance/bond documentation for five years and provide them upon BCC request. Non-compliance can also jeopardize eligibility for public-sector bids and bonding capacity with surety companies.
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Do I need a Michigan contractor license if I only do handyman work under $600?
Yes—you still need BCC registration if your handyman services involve structural alterations, electrical, plumbing, or HVAC work, regardless of project value. Michigan law exempts only purely cosmetic, non-structural tasks (e.g., painting, minor drywall patching) performed for less than $600—but this exemption does not apply to Residential Builder or M&A registration triggers. Always verify scope with the BCC before accepting work.
Can I use my out-of-state contractor license to work in Michigan?
No. Michigan does not offer reciprocity with any other state. Even licensed contractors from neighboring states like Ohio or Indiana must complete full Michigan registration—including the PSI exam, bond, insurance, and experience verification—before performing covered work. There are no waivers or expedited pathways based on out-of-state credentials.
What happens if my bond is canceled mid-cycle?
Your BCC registration is automatically suspended the day the surety notifies the state of cancellation. You have 10 calendar days to submit proof of a replacement $15,000 bond. If unresolved, your registration expires, you must cease all covered work immediately, and reinstatement requires a new application, fee, and possible retesting—depending on how long the lapse lasted.
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