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MHIC NASCLA CONTRACTORS EXAM
REVIEW LATEST UPDATE GRADED A+
Does home improvement include work done on an individual condominium unit? ✔✔Yes
Does home improvement include work done on a swimming pool? ✔✔Yes
Does a home improvement contract HAVE to be in writing in order to preserve your lien rights? ✔✔Yes
Contractors who can only contract with a contractor or a subcontractor are: ✔✔Subcontractors
A county or municipality in Maryland _____________ require a contractor to get authorization from an official in that city to be able to contract in that municipality. ✔✔Cannot
A county or municipality in Maryland _______________ regulate the character, performance and quality of home improvement. ✔✔Can
How many members are there in the Maryland Home Improvement Commission? ✔✔ 7
Of the 7 members on the Commission, how many are experienced in home improvement? ✔✔ 3
What is the term of a member on the Commission?
Associated Answers ✔✔4 Years
How long must a person be a citizen and member of Maryland before they can be appointed to the Commission? ✔✔5 years
It is illegal for a member of the Commission to receive any compensation from a person regulated by the Commission. ✔✔True
How often does the Commission hold meetings at a minimum? ✔✔12 times a year
The _______________ is a full time employee of the State. ✔✔Executive Director
People hired to investigate complaints about home improvement projects work under: ✔✔the Director of the Commission
The following are exempt from licensure requirements:
Associated Answers
1 employees for labor services
2 employees for clerical work
3 Salespersons
4 both a and b ✔✔both a and b
What is the minimum amount of liability insurance needed? ✔✔$50,
An applicant for licensure must have 2 years trade experience or comparable educational training. ✔✔true
What is the cost of the initial application fee for a home improvement contractors' license? ✔✔$
The Commission can ask an applicant for information about the applicant's...
1 character
2 experience
3 financial stability
4 all of the above ✔✔All of the above
The financial information provided by an applicant is public information. ✔✔No
If an application for a license is denied, the applicant can request a hearing within ______________ after the notice of denial is mailed. ✔✔10 days
A salesperson will not be issued a license until the salesperson becomes employed or contractually involved with a licensed contractor. ✔✔True
What is the fee to place a license on inactive status? ✔✔no more than $
A person whose license is put on inactive status...
1 must return their license to the State.
2 doesn't have to maintain the required liability insurance coverage.
3 must not do any contracting.
1 lies on their application
2 practices fraud while being licensed
3 is convicted of a felony
4 all of the above ✔✔all of the above
A contractor may not pay a subcontractor who is required to be licensed unless the subcontractor holds the required license. ✔✔True
Licensed Home Improvement Contractors are also required to hold a construction license issued by the Clerk of the Court under Title 17. ✔✔False
Home owners have a right to bring a claim against the Guaranty Fund for situations of _________________________ concerning restoration, repair, replacement or completion that arise from unworkmanlike, inadequate, or incomplete home improvement. ✔✔actual loss
What is the fee a Home Improvement Contractor must pay into the Guaranty Fund before the Commission will issue a license? ✔✔$
What is the maximum amount of money the Commission will award to any one claimant from the Guaranty Fund? ✔✔$20,000.
What is the maximum amount of money the Commission will pay out of the fund concerning the affairs of any one contractor? ✔✔$100,000.
Can a person bring a claim against the Guaranty Fund in a contract he has with the employer of his son? ✔✔No
How long does a claimant have to bring a claim against the Guaranty Fund? ✔✔3 years from discovery of the loss or damage
How many days does a contractor have to respond in writing to the copy of a claim that was sent by the Commission? ✔✔10 days
Can a disciplinary hearing and a hearing concerning a claim against the Guaranty Fund be held at the same time if the facts in this situation are the same? ✔✔Yes
Can a salesperson legally accept money for themselves from the customer? ✔✔No
It is against the law for building and permits departments to issue a permit to a contractor without the contractor's license number. ✔✔True
If a contractor fails to correct a violation of the building code within a reasonable time period, the county or municipality inspecting the project shall notify the Commission. ✔✔True
What is the maximum fine for contracting without a license - first offense? ✔✔$1,000 and/or 6 months in jail or both
What is the maximum fine for contracting without a license - second offense? ✔✔$5,000 and/or 2 years in jail or both
Contractor, Jack Smith, is not getting along with Hector Jones, his customer. If he decides not to complete the contract, has Jack broken any law? ✔✔Yes
Can a contractor decide to use a material other than specified in the contract documents without getting permission from the owner? ✔✔No
Contractors may not:
1 misrepresent their service or product
2 make false promises
3 lie on their license application
4 all of the above ✔✔All of the above
Contractor, Jack Brown, makes a deal with customer, Ameal Cougar, to provide an estimate of $40,000 on a project where the actual costs are $30,000, allowing Ameal to pocket $10,000 after securing a mortgage at $40,000 and paying off Jack. This is:
1 fraud
2 an illegal act
3 a misdemeanor
4 all of the above ✔✔All of the above
A licensed salesperson can only sell the services of licensed contractor or subcontractors. ✔✔True
A Home Improvement Contractor is a person who offers to... ✔✔perform repairs for a homeowner.
What is the MAXIMUM deposit permitted for a project with a total contract price of $1,500? ✔✔$
What is the MAXIMUM amount that a home improvement contactor may pay to a homeowner for referring a client to the contractor? ✔✔The contractor is NOT permitted to compensate the homeowner for referrals.
An applicant was denied a license after a hearing. When may the applicant reapply? ✔✔ 6 months.
What license is required for a telephone salesperson that works as an independent contractor for a home improvement contractor? ✔✔No license is required.
The Home Improvement Commission holds a hearing to determine the status of an individual's application for licensure. The Commission MUST notify the applicant of its decision with (how many days after the hearing)? ✔✔60 days.
A homeowner cancels a $1,000 door-to-door contract 2 days after signing the contract. The MAXIMUM service fee that me be collected by the contractor is ✔✔nothing. No service fee may be collected.
A renewal notice MUST be mailed by the Commission within how many months of the license expiration date? ✔✔1 month
A license that is NOT renewed will... ✔✔expire.
A local county or municipality may ________ the _______ of home improvements. ✔✔regulate, quality
The office of the Home Improvement Commission is located in... ✔✔Baltimore.
The official recordkeeper of the Home Improvement Commission, is the _________ ________ of the Commission ✔✔Executive Director
Estimate Planning ✔✔In order for a contractor to present a proposal to a customer, they first have to create a cost estimate of the entire project. Review the project documents (drawings, specifications, contracts and bonds). Attend all pre-bid meetings. Determine costs of labor, materials, equipment and subcontractors. Consider the degree of difficulty the job poses, the overhead involved, and the profit expected. Conduct a site visit!
The Quantity Take-off Method involves ✔✔counting the number of items associated with a particular construction project, determining the associated materials and labor costs, and formulating a bid (or estimate) as part of the bidding process. Quantity take-off is also applied to the pricing process. First determine labor costs (by considering historical information) and burden (employment taxes and insurance). Figure out materials, allowances and contingencies, and how they will impact the outcome of the project. Include the direct costs of rented or leased equipment.
Also consider:
Labor Costs ✔✔The cost of labor will vary from job to job. Historical information will help you arrive at an accurate estimate.
Labor Burden. ✔✔Labor burden refers to the "indirect" administrative costs of employing laborers. The cost of employment taxes and insurance (Medicare, Social Security, unemployment insurance, workers' compensation, liability insurance etc.) must be considered. Indirect labor costs can range from 25 to 70 percent of the base wage rate, and once that percentage is determined, it should be added to the direct labor costs to come up with a single hourly or "shop" rate.
Materials ✔✔The costs of materials can fluctuate, and it is important to be current in your estimate of material costs. Be sure to get several bids from each supplier. Add contingency costs for waste.
Equipment Cost. ✔✔Large equipment required to complete a project, for example a loader needed for moving stockpiled dirt for removal, is considered a direct cost. These costs will differ depending on whether or not you own or rent the equipment. If you own, calculate the unit cost of the equipment by determining the actual value (depreciation from original price), operation and maintenance costs, taxes and fees, labor and insurance. If the equipment is rented, factor in
When interviewing a person for employment, is it legal to ask them about their mental health history? ✔✔No
Employers are required to report a new employee or rehired employee to the State Directory of New Hires. ✔✔True
What Federal form are employers required to complete within 3 days of their hire for the U.S. Customs and Immigrations Service? ✔✔I-
What Federal law provides employers with their minimum wage and overtime requirements? ✔✔Fair Labor Standard Act
Do employers have to pay overtime pay to employee who works on a holiday? ✔✔No
The Wage Garnishment Law prohibits an employer from firing an employee whose pay is garnished for payment of a single debt. ✔✔True
What is the purpose of New Hire Reporting?
1 to collect taxes
2 to detect benefits fraud
3 to enforce child support orders
4 both b and c ✔✔to detect benefits fraud and to enforce child support orders
both b and c
Employers in Maryland are required to report their payroll and pay unemployment insurance taxes on their Quarterly Contribution Report ✔✔True
How many employees must an employer have before they are required to purchase Workers Compensation Insurance? ✔✔ 1
What benefit is provided to an injured employee if needed?
1 Wage replacement and payment for loss or permanent damage to body parts
2 Rehabilitation costs
3 Current and future medical costs
4 All of the above ✔✔all of the above are benefits provided to an injured employee if needed
