North Dakota Contractor License Search
What You Should Know about Hiring a Contractor in North Dakota
There are a few thousand licensed contractors in North Dakota. Hiring a licensed contractor brings peace of mind that your work will be completed by a qualified professional who knows all the relevant codes and standards for completing the project. Also, working with a licensed contractor provides coverage for financial liabilities that may result from work-related accidents. Licensed contractors are mandated to carry bonds and insurance for such unforeseeable damages. Verify your contractor's license before signing any contract to forestall falling for any scam or fraudulent contractor. When hiring a contractor in North Dakota, you should also consider the following issues:
- Who Is a Contractor in North Dakota?
- How to Search for a Contractor's License in North Dakota.
- Penalty for Hiring a Contractor Without a License in North Dakota
- How Much Does a Contractor Charge in North Dakota?
- Tips for Hiring a Contractor in North Dakota
- Is Your Contractor Insured and Bonded as Required by North Dakota Statutes?
- Top Home Improvement Scams in North Dakota
- How to Report Fraudulent North Dakota Contractors
Who Is a Contractor in North Dakota?
A contractor is any person or business offering services through an oral or written agreement. Contractors offering services that cost more than $4,000 in materials and labor must hold a valid North Dakota Contractor License. North Dakota regulates contractors at the state level through the Secretary of State (SOS). The SOS licenses eligible applicants and ensures licensed contractors comply with laws, rules, and requirements relevant to their services. Typically, contractors are:
- General Contractors oversee the construction or home improvement project from scratch and coordinate the process. They are usually the professionals a project owner makes first contact with and are responsible for ensuring the project meets agreed standards. They usually hire specialty contractors to assist with the process, especially when they do not hold dual general and specialty contractor licenses.
- Specialty Contractors: These contractors are licensed or trained to perform only specific construction services. They are also called "subcontractors" and include plumbers, electricians, carpenters, and other tradesmen with specialized training.
In North Dakota, contractors are further classified into four categories, and the SOS issues contractor licenses across these categories. They are:
- Class A Contractors: These are eligible to take on jobs exceeding $500,000 in materials and labor.
- Class B Contractors: These contractors can perform services up to $500,000 in materials and labor.
- Class C Contractors: These contractors can only provide services costing up to $300,000 in materials and labor.
- Class D Contractors: Contractors in this category are eligible to work on projects costing up to $100,000 in materials and labor.
These classifications apply to general and specialty contractors. However, certain contractors must obtain additional licenses. Examples include electrical and plumbing contractors who must obtain professional licenses from the North Dakota Electrical Board (NDEB) and the North Dakota Plumbing Board (NDPB).
How to Search for a Contractor's License in North Dakota.
There are currently more than 30,000 contractors offering their services in North Dakota. Before hiring a contractor, you should ensure they are licensed to work in the state and offer your requested services. You can conveniently verify your contractor's license through the Uhire professional license search tool. Alternatively, for contractors licensed by the SOS, you can confirm their license through the SOS' licensed contractor webpage. For electrical and plumbing contractors, you can verify their licenses through the NDEB's Find a Licensed Contractor tool and NDPB's License Lookup tool, respectively.
Penalty for Hiring a Contractor Without a License in North Dakota
There are no particular penalties for hiring a contractor without a license in North Dakota. However, hiring unlicensed contractors puts you and your project at risk in several ways. For example:
- The SOS or building officials may stop your project for building code violations and poor safety standards.
- Unlicensed contractors are usually uninsured and do not have a contractor's bond, which puts you at financial risk if your project causes injury or damage.
- There is a higher risk of getting defrauded if you work with an unlicensed contractor.
Note, however, that working as a contractor without a license is unlawful. It is a class A misdemeanor, and the SOS may assess civil penalties against the defaulting contractor.
How Much Does a Contractor Charge in North Dakota?
Specialty contractors in North Dakota charge hourly fees between $10 and $75. Besides the type of service requested, these contractors also consider your location and project-specific costs, like obtaining permits, when charging their fees. Be that as it may, the table below provides average hourly rates for commonly requested specialty contractors in North Dakota (note that factors like your preferences and the contractor's local reputation may also influence actual costs):
Likewise, it is crucial to consider the cost of hiring a general contractor when planning a project. These contractors mainly consider the overall cost of the project and different pricing styles when charging for their services. Besides charging for their services per hour, other pricing styles these contractors often use include:
- Cost-Plus style: As the name implies, this pricing style entails paying the contractor the entire cost of the project plus an added fee. The added fee is usually a fixed fee or a percentage of the project's cost, and it is the contractor's professional fee.
- Fixed fee: Under this style, the project owner agrees on a fixed amount with the contractor. The fixed amount may cover the project's cost and the contractor's professional fee or just the contractor's fees.
- Per Square Foot: This is another pricing style that involves agreeing on a fixed fee for each square foot of the project worked on. At the end of the project, the number of square feet worked on is multiplied by this fixed fee to determine the contractor's fees.
Generally, the average cost of a construction or improvement project in North Dakota is between $100 and $110 per square foot. In addition to contractor professional fees, some factors that influence a project's overall cost include:
- The location of the project
- The nature of the project
- Necessary labor and materials
- Number of subcontractors involved in the project
- The contractor's reputation and experience
Tips for Hiring a Contractor in North Dakota
Paying careful consideration to the contractor you hire for your project is essential to its success and your satisfaction. Much more than your satisfaction, a licensed and experienced contractor also ensures all relevant permits for your project are obtained and will consider all safety measures necessary. Before making a hiring choice or selecting a contractor, it is advisable to consider the following tips:
- Confirm the expertise, experience, and reputation of your contractor. You can ask your contractor to provide customer references and check these references. Also, you can check referral platforms like Yelp, Better Business Bureau, and Google Review.
- Avoid door-to-door contractors.
- Verify the license of your preferred contractor. You can do this through the Uhire professional license search tool.
- Request a written estimate from your contractor and compare this estimate with at least three contractors.
- Ensure you have a written agreement with your contractor, but read and understand the terms of the agreement before signing it.
- Verify that your contractor is insured and bonded. Request certificates of insurance and bond to confirm this.
- Have a record of documents relating to the project, especially payment references and signed documents.
- Be wary of contractors without a local address or out-of-state contractors.
Is Your Contractor Insured and Bonded as Required by North Dakota Statutes?
A requirement for contractor licensing in North Dakota is valid general liability insurance. Contractors must maintain this insurance, along with mandatory workers' compensation insurance. Failure to comply with these requirements is a license violation, and the SOS may revoke the non-compliant contractor's license. As such, you should confirm that your contractor is insured in line with these requirements to avoid issues from the SOS when your project is ongoing.
Working with insured and bonded contractors is crucial to your project's safety and success. It also helps to reduce your financial burden if damages, injuries, or anomalies result from your project. For example, insurance policies typically cover the cost of bodily injuries or property damage arising from the project. On the other hand, bonds cover the cost of addressing poor quality, incomplete tasks, contractor faults, and similar issues.
To confirm your contractor's insurance and bond, you should ask them to provide the relevant certificates of insurance or bond and further verify this with the insurance or bond company. For workers' compensation insurance, you can confirm with the North Dakota Workforce Safety & Insurance or contact this agency at (701) 328-3800 or (800) 777-5033.
Top Home Improvement Scams in North Dakota
Home improvement scams are one of the top scams in the country, with nearly 3 out of every 10,000 homeowners falling victim to these scams each year. Victims of home improvement scams typically report losing enormous sums of money, up to $6,000 on average. However, despite these concerns, you can easily protect yourself from these scams by staying updated on popular scam methods and carefully vetting any contractor or subcontractor working on your project.
Some common tactics that fraudulent contractors use to scam North Dakota homeowners include:
- Offering free inspections and then pointing out unnecessary repairs
- Unsolicited offers or door-to-door pitches
- Quoting unreasonably low estimates for the project. They reel in unsuspecting homeowners and later increase their fees midway into the project.
- Reluctance to provide a written estimate or contract
- Requesting upfront payments
- Insisting on cash payments
- Dismissing the need to verify their license, insurance, or bond status
- Pressuring you into making a hiring decision
You can avoid these scams by taking the following actions before committing to contractors:
- Compare estimates from several contractors and do not settle on the first estimate.
- Verify the license of your contractor and the subcontractors that will work on your project. The Uhire professional license search tool is helpful in this regard.
- Ask for and check customer referrals from your contractor. Also, check review and referral platforms like Better Business Bureau, Google Review, and Yelp.
- Sign a written agreement with your contractor detailing the contractor's responsibilities and payment plans.
- Be wary of unsolicited contractors and those that offer free inspections.
- Get second opinions on needed repairs unless the repairs are urgent.
- Avoid cash-only payments. Instead, pay with checks, transfers, or other recorded methods.
- Confirm the insurance and bond status of your contractor.
- Do not make hiring choices under pressure.
- Have organized records relating to the project.
How to Report Fraudulent North Dakota Contractors
Should you fall victim to an unscrupulous contractor, you can file a complaint with one or more regulatory agencies in North Dakota. Note that these agencies handle different complaints; your complaint type will determine the appropriate agency to file a report with. Also, note that there is no guarantee you will recover the money you lost. Be that as it may, below are some of these agencies and the complaints they address:
The Secretary of State (SOS).
The specific complaint types the North Dakota Secretary of State addresses include contract abandonment, fraud, misleading statements or representations, and unlicensed services. These complaint types are detailed on the SOS' How to File a Complaint Against a Contractor webpage. You may file complaints with the SOS by submitting a completed Complaint Against Contractor form to the address on the form. The SOS also addresses complaint-related inquiries at (800) 352-0867.
The North Dakota Attorney General's (AG) Office.
The North Dakota AG's Office receives and addresses complaints concerning fraudulent or questionable business practices and consumer rights violations. While the Office receives complaints on the conduct or practices of licensed professionals like contractors, complainants are advised to report such professionals to the relevant regulatory agency first. You can file an online complaint with this Office or file your complaint by mail. The Office is reachable at 1-800-472-2600 for relevant inquiries.
Small Claims Court
If you feel your contractor has scammed you of your money or fails to account for disbursed funds, you can file an action at the small claims court near you to recover your money. Small claims courts are less formal than others, and you do not need attorney representation. However, ensure you have as much evidence as possible to prove your claim. Also, note that you cannot recover more than $15,000 at the small claims court.
Better Business Bureau (BBB)
The BBB encourages homeowners across North Dakota and the country to report instances of fraud or questionable practices by a contractor. This helps the Bureau inform other homeowners so they do not fall victim to the contractor. The BBB may also take other administrative actions against such contractors on their platform, such as suspending the contractor's account. You can file your report with any of the BBB's local offices near you.
The Police Department.
The Police Department receives complaints concerning illegal activity, such as fraud, theft, threats to life, or property damage. If your contractor does anything unlawful, ensure to file a report with your local police department promptly.