How to check a contractor's license before you hire

You've found someone who can fix the roof, or redo the bathroom, or finally deal with that sagging deck. They seem nice. The price sounds fair. Before you hand over a deposit, take five minutes and look up their license. It's the cheapest insurance you'll ever buy, and most people skip it.

Here's how to do it, what you're actually looking at when the record comes up, and what to do when the answer isn't clean.

Why the license matters more than the sales pitch

The Federal Trade Commission's advice is short and blunt: consider only contractors who are licensed and insured. Check with your state or county government to confirm the license, and ask the contractor for proof of insurance.

That's not bureaucratic box-checking. A license usually means someone at a state or local office has confirmed the business exists, and in many places that the owner passed a trade or law exam, carries a bond or insurance, or both. It also gives you somewhere to turn if the job goes wrong. An unlicensed worker who vanishes with your deposit leaves you with very few options.

The FTC also makes a point worth sitting with: a good ad isn't proof a contractor does quality work. A polished website, a truck with a logo, and a friendly voice on the phone tell you nothing about whether they're allowed to do the job.

First, find out what your state actually requires

This is where people get tripped up. Licensing isn't national. The FTC notes that many states, but not all, require contractors to be licensed or bonded, and that licensing can range from a simple registration to a detailed qualification process. Some states license only certain trades, like electricians and plumbers. Some leave general contractors to cities or counties.

So start by asking two questions:

1. Does my state license this kind of work? Search your state's name plus "contractor license lookup." The official result will usually be on a .gov site run by a licensing board, a department of labor or professional regulation, or the secretary of state.
2. Does my city or county license it? Your local building department can tell you. The FTC suggests asking the building department or your local consumer protection agency what applies where you live.

If both answers are "no license required," you're not done. You still want proof of insurance, references and a written contract. More on that below.

How to run the lookup

Once you've found the right official lookup page, you'll usually be able to search by business name, owner name or license number. The license number is the most reliable. Ask for it directly. A legitimate contractor will give it to you without hesitation, and in some states it's required to appear on contracts and advertising.

When the record comes up, check:

• The name matches. The business name on the license should match the name on the estimate and the contract. If the license belongs to someone else, ask why.
• The status is active. Expired, suspended or revoked licenses all mean stop.
• The classification fits the job. A license for one trade doesn't always cover another. In states with classifications, make sure the type matches what you're hiring for.
• Bond and insurance information. Many state records list a bond or workers' compensation status. Note what's there.
• Disciplinary history or complaints. Some boards publish past actions. One old complaint isn't necessarily a deal-breaker, but a pattern is.

California's Contractors State License Board, for example, invites homeowners to check a contractor's license status before signing anything, and its consumer guide walks through the questions to ask. Georgia's Attorney General tells consumers to ask to see the contractor's license and check that it's valid with the state. Whatever state you're in, the official board is the source that counts, not a screenshot the contractor texts you.

Ask for proof of insurance, then verify it

Licensing and insurance are separate things. The FTC recommends asking for proof of insurance either way. Two kinds matter most for a home job:

• Liability insurance, which covers damage the contractor causes to your property.
• Workers' compensation, which covers their workers if someone gets hurt on your property.

Ask for a certificate of insurance and call the insurance company listed on it to confirm the policy is current. It's a short call, and it closes one of the most common gaps.

Warning signs that mean slow down

The FTC's disaster-scam guidance lists red flags that apply to any job, storm or not:

• They claim they don't need to be licensed to do the work.
• They offer a discount, but only if you sign right away.
• They want cash up front, or won't give you copies of their license, insurance or a written contract.

Add to that list anyone who asks you to pull the building permit yourself. Georgia's Attorney General advises making sure the contractor gets the permit under their own name or their business name, which protects you if the work doesn't meet code.

A quick checklist before you sign

1. Get the license number and look it up on the official state or local site.
2. Confirm the name, status and classification match the job.
3. Get a certificate of insurance and call to verify it.
4. Get written estimates from more than one contractor. The FTC says not to automatically choose the lowest bid, and to ask about big price differences.
5. Call references and, if you can, look at finished work.
6. Get a written contract with the contractor's name, address, phone and license number. Our guide to written estimates and contracts covers what else belongs in it.
7. Keep the deposit small and tie payments to finished work.

Frequently asked questions

What if my state doesn't license this trade at all?

Then the license check can't help you, so lean harder on everything else: insurance, references, reviews from sources you trust, a written contract and a payment schedule tied to progress. Your local building department may still require permits for the work, and inspections give you a second set of eyes.

Is a business license the same as a contractor license?

No. A general business license from a city usually just registers the business to operate. It doesn't mean anyone tested the owner's skills or checked insurance. If your state has a contractor license for the trade, that's the one to look up.

The contractor says they're working under someone else's license. Is that OK?

Be careful. Rules vary by state, and in some places it isn't allowed. Ask whose license it is, look that license up, and make sure the licensed business is the one named on your contract.

Where do I complain if something goes wrong?

Start with the licensing board that issued the license. You can also contact your state attorney general's consumer protection office or local consumer agency. For scams, the FTC takes reports at ReportFraud.ftc.gov.

Rules differ from state to state and change over time, so treat your state licensing board as the final word on what's required where you live.