New Jersey Contractor License Search
What You Should Know about Hiring a Contractor in New Jersey
Over 135,000 licensed contractors are available for hire in New Jersey. Working with a licensed contractor brings peace of mind and a lot of savings. Licensed contractors are able to complete your project per relevant local codes and industry regulations. Also, these professionals are mandated to carry appropriate bond and insurance policies that protect them and their clients in the event of damages or work-related injuries. However, verifying your prospective contractor's license is wise to ensure you do not end up with a fraudulent one who may run with your money or jeopardize your family's safety.
Besides providing that your contractor is correctly licensed, you should consider the following issues when hiring a contractor in New Jersey:
- Who Is a Contractor in New Jersey?
- How to Search for a Contractor's License in New Jersey
- Penalty for Hiring a Contractor Without a License in New Jersey
- How Much Does a Contractor Charge in New Jersey?
- Tips for Hiring a Contractor in New Jersey
- Is Your Contractor Insured and Bonded as Required by New Jersey Statutes?
- Top Home Improvement Scams in New Jersey
- How to Report Fraudulent New Jersey Contractors
Who Is a Contractor in New Jersey?
Contractors in New Jersey are businesses and individuals who provide their services in exchange for money. These services are typically offered and provided according to written or oral contracts or agreements. They can range from repairing and maintaining properties to constructing and altering buildings. The regulation and licensing of contractors will be carried out at the state and city level. For instance, the New Jersey Division of Consumer Affairs (NJDCA) registers contractors that take homes or non-commercial properties and licenses specialty contractors like plumbers, HVCA, and electrical contractors in the state.
There are two broad categories of contractors operating in New Jersey:
- General Contractors: A general contractor mainly supervises and oversees building, home improvement, and construction projects on behalf of their clients. These contractors will be specialists in industrial, commercial, and residential construction. Regardless of the scope or nature of the project, general contractors are usually the main contact point between the project's owners and the laborers, suppliers, and subcontractors. There are two subcategories of general contractors in New Jersey:
- Home improvement contractors: These are professionals involved in the construction, repair, installation, alterations, and modifications of residential, non-commercial units or commercial properties that are being converted to residential or "non-commercial" units in New Jersey. Contractors offering financing options to customers for home improvement or construction projects must also obtain an additional license from the New Jersey Department of Banking and Insurance.
- Commercial General Contractor: This type of contractor specializes in constructing various commercial facilities such as hospitals, office buildings, warehouses, and other non-residential structures. While the NJDCA does not require these types of contractors to be registered, it is essential to note that requirements for commercial contractors may vary by locality within the state. For instance, commercial general contractors in Newark must obtain a building contractor license before offering services.
- Specialty Contractors: These individuals provide various construction, home improvement, and building services, such as plumbing, painting, and HVAC. In New Jersey, a specialty contractor is required to obtain a license from the relevant NJDCA Board of Examiners. However, other contractors, like landscapers, must get their support from the New Jersey Department of Community Affairs through its Board of Landscape Irrigation Contractors.
How to Search for a Contractor's License in New Jersey
The New Jersey Division of Consumer Affairs is responsible for registering contractors (home improvement contractors) and licensing specialty contractors like electricians, plumbers, and HVAC professionals. The Uhire Professional License tool can help confirm that the contractors you plan to hire have the necessary licenses using their license number or name. You can also use the New Jersey Division of Consumer Affairs License Verification System to determine whether your contractor is registered and the specialty contractor's license is valid.
Penalty for Hiring a Contractor Without a License in New Jersey
There are no penalties for hiring an unlicensed contractor in New Jersey. However, there are potential drawbacks to hiring unlicensed contractors, including:
- Unlicensed contractors can cause project delays and issues due to their lack of expertise and experience. They are also more prone to cutting corners while working, resulting in poor service.
- Unlicensed contractors do not usually carry bonds or insurance, and they can make you liable for any issues that may arise during a project.
- Unlicensed contractors can not do home improvement or construction work without getting the required permits. Doing so could lead to administrative penalties and fines, and it can also affect the value of your property.
Individuals who engage in unlicensed activity within New Jersey are guilty of a misdemeanor, and it carries a civil fine of up to $10,000 for a first offense and $20,000 for each subsequent infraction.
How Much Does a Contractor Charge in New Jersey?
The hourly cost of hiring a specialty contractor can range from $50 to $110 in New Jersey. Note that your project's complexity, scope, and nature will determine the total amount you pay.
The table below shows the typical rates of specialty contractors and subcontractors in New Jersey. These rates may vary depending on the experience level of the contractor, your location, and their reputation:
Most home renovation and construction projects require the services of several contractors. Managing these individuals can be very time-consuming and demanding. Hiring a general contractor can help you manage these tasks and handle the rest of the project for a percentage of the total cost, usually 10 to 20 percent.
The actual cost of a project can be calculated by utilizing one of the fee structures listed below:
- Fixed Bid: This fee structure allows a general contractor to provide a fixed price for a project. This sum includes the cost of the materials and supplies and the markup the company charges for its services.
- Cost Plus: This fee structure allows the general contractor to provide a cost estimate that includes the required materials and supplies and an hourly rate for the laborers and subcontractors. It's ideal for projects that have no specific timelines or scopes.
A home improvement or construction project in New Jersey typically costs around $80 to $140 per square foot. However, this figure can vary depending on various factors, including:
- Your location,
- Site conditions and accessibility to the project site,
- The project's nature and scope,
- Labor intensity and costs,
- The cost of required materials,
- The experience and reputation of involved contractors
- Contractor fees, labor fees, permit costs, and other related expenses
Tips for Hiring a Contractor in New Jersey
Renovations and home repairs typically involve substantial sums of money. Even minor home maintenance and repairs may result in significant expenses. Making the right decision when hiring a contractor for a project is very important. Your first step is to determine the scope of your project and the kind of contractors needed. You should also apply the tips below when looking for a contractor:
- Get and compare detailed cost estimates from several contractors.
- Verify that the contractor has the necessary licenses to work with the New Jersey Department of Consumer Affairs or the appropriate licensing board.
- Ensure that the contractor carries adequate liability insurance and bond
- Ask for references from the contractor. Contact their past clients to ask about their experiences and the quality of work
- Carefully review contracts and understand the terms and conditions outlined in the contract before signing
- Get all agreements, additions, and changes to the project in writing
- Seek recommendations from trusted sources like friends, family, and neighbors.
- Do not pay the full cost of your project upfront. You should also limit advance payments to one-third of the project's total cost.
- Avoid cash payments and ensure you only make the final payment after completing the project satisfactorily.
- Keep good records of all project-related paperwork like invoices, receipts, and contracts.
Is Your Contractor Insured and Bonded as Required by New Jersey Statutes?
All registered contractors in New Jersey must carry a commercial general liability insurance policy with a minimum coverage of $500,000 per occurrence. The contractors you hire must have liability insurance and bonds to protect you from the financial repercussions of any errors and third-party injuries that may occur during your project.
Note that bonds and insurance provide different types of financial protection. Bonds are usually used to cover the financial losses caused by the failure of a contractor to deliver the services promised. On the other hand, insurance policies typically provide the project owner and contractor financial protection against work-related incidents.
Before you hire a contractor in New Jersey, you must request copies of their bond and insurance certificates. You should also check with the relevant issuers to see if their coverage limits are adequate for the project. You can also contact the New Jersey Division of Consumer Affairs at (973) 504-6200 for more information about the state's mandated commercial general liability insurance policy.
Top Home Improvement Scams in New Jersey
Home improvement fraud is a common issue in New Jersey, with approximately 2.4 out of every 10,000 homeowners falling victim to such schemes. Annually, the New Jersey Division of Consumer Affairs (NJDCA) receives thousands of home improvement complaints. Scam artists posing as contractors often target homeowners in the state by promising to perform work they cannot carry out at low prices. There are a few warning signs that you should be aware of when dealing with fraudulent contractors, including:
- Lack of proper credentials like licenses, bonds, and insurance coverage
- High-pressure or aggressive sales tactics to rush you into making quick decisions
- Unrealistically low bids compared to other contractors' cost estimates for the same project.
- Requests for large upfront payments or require full payment before work can commence.
- Avoid or are reluctant to provide a detailed written contract
- Unwilling or hesitant to provide references from past customers
- Poor communication and unprofessional behavior by consistently failing to return calls, respond to emails, or provide updates on the project.
There's no way to eliminate the likelihood of dealing with contractors trying to scam you out of your money with home improvement projects. Nevertheless, you can still significantly reduce your chances of hiring a fraudulent contractor by following these precautions:
- Ensure that the contractor is appropriately licensed, bonded, and insured. Verify the authenticity of their license and insurance certificates with the relevant licensing body and insurance company.
- Obtain and compare detailed cost estimates from multiple contractors for your project. Be cautious of significantly low or high bids as they may indicate potential scams.
- Insist on a written contract that includes detailed project scopes, timelines, payment terms, and any warranties. Carefully read and understand all terms and conditions outlined in the contract before signing.
- Avoid cash payments
- Never pay the full project cost upfront. Limit the downpayment to about one-third of your project's total cost upfront.
- Keep records of all agreements, changes, invoices, and receipts safe
How to Report Fraudulent New Jersey Contractors
You can report instances of fraudster contractors in New Jersey to various government organizations. They can help you find solutions:
The New Jersey Division of Consumer Affairs (NJDCA)
You can file a complaint about contractors' fraudulent scams with the NJDCA's Office of Consumer Protection by completing an online complaint form or filing and sending a pdf complaint form via mail to:New Jersey Office of the Attorney General
Division of Consumer Affairs
P.O. Box 45025
Newark, NJ 07101
Small Claims Court
If you are dissatisfied with the outcome of the mediation process that the NJDCA's Office of Consumer Protection has provided, you can take action by filing a small claims case against the erring contractor at the Special Civil Part of the New Jersey Superior Court. Note that for small claims cases, the maximum amount that can be recovered is $5,000. The filing fee for small claims is $42 for one defendant and $12 for an additional defendant, if any.
The Police Department
You should contact your local police department if you are threatened or robbed by a contractor.
The Better Business Bureau (BBB)
The Better Business Bureau is a non-profit organization that aims to help consumers identify and prevent fraudulent contractors from operating. When you report to the BBB local branch near you, they can inform other people about these types of criminals and help curb the potential victims of such criminals.