Travel and Leisure

5 Advantages of Contractors License


When they start the contracting business, many contractors don’t want to invest money in getting the contractor’s license. However, with the economy and the construction field growing every day, not planning to get a contractor’s license can be a big negative for a contracting firm. Because as the contracting sector becomes organized, the demand for certified people and firms will increase. If you are not in contention for getting the contractor’s license, such as a Florida contractor license, you will be left behind in the race. 

This article will explain the five advantages of getting a contractor’s license for your business.

Getting certified reduces the risk of legal actions

The legal proof is essential for a professional service such as a contractor’s license. In California, a contractor who doesn’t have a contractor’s license cannot bid for a job above $500. Moreover, if the contractor is caught bidding for a job above $500 without the contractor’s license, they are charged heavy fines between $3000 and $15,000. Thus getting a contractor’s license will protect you legally from getting penalties.

Getting Financial Independence

As explained in the previous section, without a contractor’s license, a person cannot bid for a project above $500. Therefore, if a person is allowed to take contracts above $500, the person’s chances of growing financially become bleak. Because with the contracts less than 500$, the person can only undertake small projects. However, there is no upper limit for grabbing a contract with a contractor’s license. Hence, a person can get contracts of big amount as well.

 Payment for the work

If you have a contractor’s license, you are assured of getting payments for the work done under the Mechanics Lien Rights. According to these rights, a contractor, laborer, sub-contractor, and materials supplier have the freedom to file a “mechanics lien” on the property owner who hasn’t paid them for the work. The “mechanics lien” puts a hold on the construction site, which hasn’t paid the contractor, laborer, subcontractor, or material supplier. 


Working without a contractor’s license can be extremely risky because the Contractors’ state license board continuously runs sting operations for finding out the unlicensed contractors. The people who are caught doing work outside the regulations are fined heavily for their wrongdoings. Moreover, if the breach is severe, the contractor can also be jailed for some time. Thus with a contractor’s license in hand, you can work stress-free because you are legally correct.

Creating new business relationships

With a contractor’s license in hand, you have the freedom to bid on bigger and more profitable projects. Thus, it not only helps you earn more money, but it also helps you create new relations with different people in the contracting world. Moreover, larger companies that undertake massive projects hire licensed contractors for doing specific work on their projects. Thus with a contractor’s license, you can get the opportunity to work with big MNCs and construction companies.

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