Alabama Contractor License Search

What You Should Know about Hiring a Contractor in Alabama

Currently, over 9,500 contractors are licensed to ply their trade in Alabama. Engaging licensed contractors guarantees that your projects are in the hands of professionals who are adequately trained and have the skills to deliver quality services. Most licensed contractors are also insured and bonded, protecting you from financial liability if something goes wrong with the project. Other advantages of hiring licensed contractors include the following:

  • It avoids fraudulent professionals or businesses.
  • You'll have contractors who understand industry standards working on your project.
  • It reduces safety risks during the project.

Most trades and professions in Alabama are regulated at the state level. So, when planning to hire a contractor for your project, it is best to consider the following points:

Who Is a Contractor in Alabama?

Contractors are individuals and businesses that offer services based on an agreement. The State of Alabama requires that anyone working as a contractor within the state is licensed, except in specific, unregulated circumstances. The Alabama Licensing Board for General Contractors (LBGC) and the State of Alabama Home Builders Licensure Board (HBLB) are the agencies responsible for contractor licensing in the state. The LBGC issues licenses to general contractors, although these contractors are further classified under more than ten sub-categories. Broadly speaking, the categorization is as follows:

  • General Contractors: These are typically commercial and industrial contractors but also include all other types of contractors that offer construction, demolition, maintenance, or related services, where the cost of such services is $50,000 or more, including labor and materials. This category also includes contractors offering swimming pool construction services, which cost $5,000 or more. General contractors are further sub-classified:
    • Building Construction Contractor: These contractors oversee building constructions, modifications, or additions where the purpose of such buildings is comfort, convenience, shelter, or protection.
    • Building Construction under Four Stories (BCU4) Contractor: These contractors offer the services of a Building Construction Contractor, but only for buildings three stories or less in height and any roof structure not exceeding 50 feet in height.
    • Highways & Streets Contractor: These contractors construct roads, streets, guardrails, parkways, fences, and parking areas.
    • Municipal & Utility Contractor: These contractors clear, grub, or pave gutters, walks, driveways, and sewers and perform related services.
    • Heavy and Railroad Construction Contractor: These contractors construct railroads, bridges, tunnels, drainage, and irrigation projects and oversee similar large-scale activities.
  • Specialty Contractors: This category includes contractors who offer specific services to assist general contractors in completing their tasks. Each of the general contractor sub-classifications also has a specialty contractor sub-classification. Examples of other specialty contractors include electrical, plumbing, and HVAC contractors, usually referred to as "subcontractors." Furthermore, while it is usually the case that a general contractor hires one or more subcontractors for a project, it is equally possible for project owners to engage subcontractors directly.

On the other hand, the HBLB licenses home builders or residential contractors. These are professionals involved in construction and home or property improvement projects that cost over $10,000 but less than $50,000 considering labor and materials. Home builders also include professionals who offer roofing services, which cost over $2,500. The HBLB issues home builders licenses in three categories:

  • Unlimited License: This license type is for home builders offering services exceeding $10,000 that involve more than one trade, affect the structural integrity of a building or both.
  • Limited License: This license is required for home builders who offer services costing more than $10,000.
  • Roofers License: This license type is for home builders who offer roofing services costing over $2,500.

How to Search for a Contractor's License in Alabama

The LBGC licenses nearly 10,000 contractors annually across two major categories and more than ten subcategories. Similarly, the HBLB regulates several other professionals. To confirm that your intended contractor or home builder is licensed to operate within the state, you can use the Uhire professional license search tool or either the LBGC's License Roaster Search or the HBLB's license search portal.

Penalty for Hiring a Contractor Without a License in Alabama

There are no specific penalties for hiring an unlicensed contractor in Alabama. However, doing this has several disadvantages and risks:

  • Hiring unscrupulous individuals or dealing with a fraudulent business.
  • Engaging an unqualified professional will likely ruin your project, resulting in avoidable repair expenses.
  • Having permit problems, as unlicensed contractors are typically ineligible to obtain permits. Be aware that you may be fined by state or city officials if the relevant agency or city department has not issued the required permits for your project.
  • Hiring uninsured professionals. You bear the financial liability when injuries or property damage occur during your project.

On the other hand, it is a class A misdemeanor to operate as a contractor or home builder without the requisite license. In addition to other penalties, offenders may be fined up to $5,000 by the LBGC or the HBLB, as the case may be.

How Much Does a Contractor Charge in Alabama?

Specialty contractors in Alabama charge between $15 and $100 per hour, and their fees are usually lumped with that of your general contractor, except you have a separate agreement with them. The table below provides average hourly rates for commonly requested specialty contractors in Alabama (note that factors like your location and the contractor's local reputation may influence actual costs):

$20 - $30
$20 - $30
HVACR Technicians
$18 - $25
$15 - $25
$15 - $23
$15 - $25
Flooring Contractors
$15 - $23
$20 - $30
$15 - $45
$65 - $100
Interior Designers
$20 - $35
Excavation Contractors
$15 - $30
Concrete Contractors
$15 - $30
$50 - $75
Appliance Repair Technicians
$15 - $25
$15 - $30
Cleaning Services
$15 - $20
$10 - $20

Average construction prices for residences in Alabama are between $90 and $130 per square foot. This is slightly below the national average of between $150 and $160 per square foot. However, different factors determine how much a contractor may charge for the services you need. An example of these factors is the contractor's pricing style. Besides charging by the square foot, contractors sometimes opt for any of the following pricing styles:

  • Fixed Fee: This pricing style entails estimating the project's cost in terms of labor, materials, and time and then agreeing on a lump sum. Usually, the contractor and project owner agree on the lump sum, which may be paid in installments, before the project begins. This pricing style is best for small or medium-scale projects with short or clear timelines.
  • Per Hour: Under this pricing style, the contractor agrees with the project owner on an hourly fee. The final cost for the project is an aggregate of the hours spent on the project multiplied by the hourly fee.
  • Cost-plus: This pricing style involves paying the contractor the cost of the project plus an additional fee. The additional fee is usually a percentage of the project's cost. However, if your contractor uses this pricing style, it is advisable to agree on a maximum amount to ensure the final fee does not snowball.

The number of specialty contractors working on your project also determines how much your contractor may charge. Other factors that can influence your contractor fees may include the following:

  • The nature and complexity of the required services
  • The urgency of the service
  • Labor costs
  • Permit costs
  • Accessibility to your location

Tips for Hiring a Contractor in Alabama

Home improvement projects typically involve a lot of money, time, and sentiment. As such, it is necessary to get it right with any contractor you are hiring for your project. Because of the amount of money involved in these projects, unscrupulous individuals and businesses seek to defraud project owners. To avoid falling victim to these fraudsters, consider the following tips before hiring:

  • Ensure your contractor has the requisite license. You can confirm a contractor's license through the LBGC's License Roaster Search or a home builder's license through the HBLB's license search portal. The LGBC is also reachable at (334) 272-5030 and the HBLB at (800) 304-0853 to answer licensing inquiries.
  • Compare estimates from multiple contractors (at least three) before making a commitment.
  • Verify the contractor's reputation. You can do this by requesting customer referrals or checking third-party consumer websites like the Better Business Bureau, Google Review, and Yelp.
  • Hire only insured and bonded contractors. This ensures you do not suffer financial liability to remedy injuries or property damage that occurred during your project. This also gives you a financial buffer if your contractor does poorly or absconds.
  • Get a written contract from the contractor.
  • Avoid making substantial down payments.
  • Make payments with checks, money transfers, credit cards, or any other traceable payment method. Avoid cash payments as much as possible, and request a signed receipt when you make payments in cash.
  • Keep all documents related to the project (especially receipts and invoices).

Is Your Contractor Insured and Bonded as Required by Alabama Statutes?

One of the requirements for obtaining an LBGC-issued license is to have valid liability insurance. The Board does not require contractors to file a bond. On the other hand, the HBLB requires prospective unlimited and limited home builders license holders to provide a business-related credit report before obtaining any of these licenses. The Board also requires Roofers license holders to file and submit a $10,000 license/permit bond. In any case, contractors with five or more employees must have valid workers' compensation insurance.

Insurance and bonding for contractors in Alabama vary widely. As earlier noted, they are optional for some and partly compulsory for others. Regardless of this, it is in your best interest that any contractor you hire is both insured and bonded. The importance of insurance and bonding cannot be overstated, although they operate differently. A contractor's insurance protects you from full financial liability if your project causes injury or property damage. A bond protects you from total loss if your contractor does a terrible job or fails to complete the job. You can get compensation from the contractor's bond in the form of a refund of money paid or funds to make the necessary repairs or complete the project.

Therefore, ensure you request proof of your contractor's insurance and bond status and take steps to verify such proof with the issuing company or organization. Also, in the case of insurance, confirm the insurance policies your contractor holds, including general liability and workers' compensation insurance. You should also verify the insurance amount is enough to cover mishaps that may occur during your project.

Top Contractor Scams in Alabama

The Alabama Attorney General's Office receives hundreds of home improvement-related complaints annually. Nationwide, nearly 3 out of every 10,000 homeowners fall victim to these scams, indicating a need to be cautious when dealing with home improvement contractors.

Some common tactics that fraudulent contractors use to scam Alabama homeowners include the following:

  • Door-to-door solicitation
  • Giving unreasonably low estimates and later increasing contractor fees as the work progresses.
  • Asking for substantial down payments and never completing the job
  • Insisting on cash payments
  • Refusal to sign a written contract or give a written estimate
  • Price gouging, especially for urgent projects
  • Using fear and high-pressure tactics to make you hire them or sign a custom agreement without doing the necessary background checks
  • Offering free or cheap inspections to point out needless repairs

You can avoid these scams by taking the following actions before committing to contractors:

  • Compare estimates from different contractors before hiring anyone.
  • Avoid unsolicited services and contractors.
  • Verify the contractor's license using the LBGC's License Roaster Search or the HBLB's license search portal as applicable.
  • Request customer referrals from prospective contractors and check them.
  • Do not make substantial down payments: deposits should not exceed 10% of the contract price.
  • Reduce cash payments to the minimum or avoid them altogether.
  • Ensure you sign a written contract with your contractor. However, read and understand its terms before signing.
  • Request lien waivers from your contractor to ensure your project is not subject to a lien.

How to Report Fraudulent Alabama Contractors

If you have consumer complaints from your experience with an Alabama contractor, there are several authorities you can report the situation to and seek remedy, depending on the nature of the complaint. Some of these agencies are listed below:

Alabama Licensing Board for General Contractors (LBGC)

This agency receives and addresses complaints on unlicensed contracting by commercial contractors. Complaints regarding a licensed contractor's violation of relevant federal, state, or city laws can also be directed to this board. You can file a complaint by submitting a completed Concern/Complaint form.

State of Alabama Home Builders Licensure Board (HBLB)

This agency handles complaints regarding unlicensed residential contractors and licensed residential contractors who have violated relevant laws and occupational requirements. This board maintains separate methods for reporting unlicensed activity and reporting licensee violations.

Alabama Attorney General's (AG's) Office

Complaints concerning a contractor's unethical business practices, fraudulent conduct, or general dishonesty can be reported to the AG's Office through the Office's online complaint form.

Small Claims Court

In a situation where the contractor refuses to comply with a signed agreement with you or has received money but refused to do the job, you can file a case against them at the small claims court serving your city. However, it is best to first report the contractor to the relevant regulatory board or the AG before filing the case. Be aware that the maximum amount you can recover through the small claims court is $6,000.

Better Business Bureau (BBB)

You can also report a contractor to the local office of the BBB near you. While the BBB can only take action against a contractor if this contractor is on their platform, your report can assist other homeowners with making better choices when looking for a contractor to hire.

The Police Department

It is best to first report to your local police department if your contractor threatens you, steals from you, or does anything unlawful.