New Mexico Contractor License Search
What You Should Know about Hiring a Contractor in New Mexico
New Mexico has a pool of about 14,000 licensed contractors ready for hire at a moment's notice. Working with a licensed contractor comes with several advantages like the following:
- Having your project completed in line with regulatory codes and standards
- Having insurance coverage for damages and work-related injuries
- Having bond coverage for unsatisfactory work
Ensuring your contractor's license is in order also saves you the heartache of ending up with fraudulent contractors who may run away with your money.
Besides verifying your contractor's license, you should consider the following points when hiring a contractor in New Mexico:
- Who Is a Contractor in New Mexico?
- How to Search for a Contractor's License in New Mexico
- Penalty for Hiring a Contractor Without a License in New Mexico
- How Much Does a Contractor Charge in New Mexico?
- Tips for Hiring a Contractor in New Mexico
- Is Your Contractor Insured and Bonded as Required by New Mexico Statutes?
- Top Home Improvement Scams in New Mexico
- How to Report Fraudulent New Mexico Contractors
Who Is a Contractor in New Mexico?
Contractors are individuals or businesses that provide services to interested parties per written or oral agreements in exchange for compensation. New Mexico contractors who offer building, construction, and home improvement or repair-related services are regulated by the state's Regulation and Licensing Department (NMRLD) through its Construction Industries and Manufactured Housing Divisions. While the NMRLD offers over 70 license classifications and scopes, including general building, plumbing, HVAC work, drywall installation, electrical work, and carpentry, these contractors are typically categorized into two main groups:
- General Contractors: general contractors typically coordinate and oversee building and home remodeling projects on behalf of the project owner; however, they may also perform actual construction, maintenance, or repair work within the scope of their respective licenses. In New Mexico, general contractors often specialize in one of the following areas:
- Residential Contracting: contractors with this specialization focus on residential construction and improvement projects.
- Commercial Contracting: commercial contractors specialize in constructing office buildings, hotels, shopping malls, and similar structures used primarily for commercial purposes.
- Industrial Contracting: contractors with this specialization focus on large-scale projects involving industrial facilities.
- Specialty Contractors: specialty contractors perform specific building, construction, and home improvement or repair work that often requires specialized skills, training, and knowledge. These contractors are usually hired directly by a home or project owner for one-time-only jobs, or general contractors can subcontract them to contribute their expertise to an overarching project. This is usually the case for large-scale construction or home remodeling projects (in these scenarios, the specialty contractor is typically referred to as a subcontractor).
How to Search for a Contractor's License in New Mexico
Contractors in New Mexico must hold a valid NMRLD-issued license to bid for or perform work that involves constructing, altering, repairing, or modifying buildings and structures. There are over 59,000 licensed contractors and contracting businesses in the state, and you can verify that your intended contractor holds an appropriate license for your project's scope using the Uhire Professional License Search tool.
The NMRLD also offers search tools on its Online Services webpage that you can use to verify your contractor's license. Notice that you will need to scroll down on this webpage, click on either the Construction Industries Division or Manufactured Housing Division option (depending on the nature and scope of your project), and then select "verify a license" or "verify a licensed facility" to use the NMRLD license search options.
Penalty for Hiring a Contractor Without a License in New Mexico
It is unlawful to contract without a license in New Mexico. As a home or project owner, you also risk having your construction or home improvement project stopped when you hire unlicensed contractors. Other repercussions of engaging unlicensed contractors in New Mexico are as follows:
- Financial and Legal Liabilities: unlicensed contractors often lack sufficient bond and insurance coverage. This means that you, as the client, may become liable for any work-related accidents, injuries, or property damage that may occur during the project.
- Lack of Qualifications and Experience: licensed contractors must pass tests demonstrating their competence, knowledge, and experience. By hiring an unlicensed contractor, you risk engaging an inexperienced individual who does not have the necessary qualifications to provide the services you need. This inevitably results in project delays, poor workmanship, and overall unsatisfactory service delivery.
- Noncompliance with Regulations: in addition to being unable to obtain necessary permits, unlicensed contractors are very likely to disregard relevant codes and regulations. This not only compromises your safety but can also result in administrative penalties due to code violations, which can also negatively impact the value of your property.
Unlicensed contracting is considered a misdemeanor in New Mexico, punishable by a 90-day jail term, fines of up to $500, or both. Note that this penalty only applies when the total value of the unlicensed work does not exceed $5,000. When the unlicensed contractor performs work worth more than $5,000, the penalty is increased to a six-month jail term, a fine of 10 percent of the value of the illegal work done by the contractor, or a combination of both.
How Much Does a Contractor Charge in New Mexico?
The average cost of hiring a specialty contractor in New Mexico usually ranges from $40 - $100 per hour. However, variables like your location, the specific kind of contractor you wish to hire, the contractor's experience and local reputation, and the labor intensity of your required services all influence the overall cost of engaging these contractors.
The table below shows the average hourly rates charged by several kinds of specialty contractors (subcontractors) in New Mexico.
Building and construction projects in New Mexico (whether residential, commercial, or industrial) typically require the expertise of several specialty contractors, materials suppliers, and laborers. Getting a general contractor to manage the project is a practical option that saves you the time and stress of coordinating and supervising all involved parties yourself. General contractors in New Mexico typically charge clients 10 – 20 percent of the total project cost for their services. The actual cost of engaging these contractors for your project will usually be determined using one of the following billing methods:
- Lump Sum / Fixed Bid Method: here, the general contractor commits to completing the project for a pre-determined fee or lump sum. This method is particularly suitable for projects with a well-defined scope and timeline.
- Cost Plus Billing Method: here, the general contractor charges the client for the work done by subcontractors and laborers involved in the project, plus a separate pre-determined percentage for their services. This billing method is preferred for large projects with uncertain timelines. However, we recommend you negotiate a maximum price cap with the contractor; this ensures that you do not exceed your budget.
The average cost for building and construction projects in New Mexico typically falls within the range of $100 to $1500 per square foot. Nevertheless, several factors like the following influence the actual cost of undertaking these types of projects:
- Your location
- The nature, scope, and complexity of the project
- Required permits and construction materials
- Site conditions and accessibility
- Contractor expertise and reputation
- Contractor fees, labor costs, and related expenses
Tips for Hiring a Contractor in New Mexico
Construction and home improvement spending in New Mexico runs into the billions of dollars every year. Considering the amount of money typically required to undertake these projects (even seemingly minor tasks like replacing faulty fixtures can incur costs reaching a few hundred dollars), a well-thought contractor selection process is crucial in guaranteeing a satisfactory outcome. By following these tips, you can ensure that you hire a contractor who can effectively manage costs and deliver high-quality services for your construction or home improvement project:
- Get a clear idea of your project and everything it entails.
- Get bids for the project from several contractors and compare their quotes before hiring.
- Verify your preferred contractors' license status.
- Ask for references and check them. You should also consider looking up reviews and testimonials on the contractor online.
- Verify that your chosen contractor is adequately insured and bonded. Do the same for all subcontractors involved in the project.
- Insist on a written contract that details the contractor's responsibilities, a description of the project, its total cost, a payment schedule, and an estimated timeline. Review the contract carefully before signing.
- Never pay the project's full cost upfront and limit down payments to a maximum of 30 percent of the project's cost. You should also consider requesting documentation from the contractor showing how down payments will be spent.
- Do not pay in cash or cryptocurrency. Always use traceable forms of payment, like checks and credit cards.
- Ensure that the project has been executed according to the terms of your contract and that you are satisfied with the job done before making final payments.
Is Your Contractor Insured and Bonded as Required by New Mexico Statutes?
New Mexico contractors are statutorily required to carry workers' compensation insurance for their employees (if any) and maintain a $10,000 bond as proof of responsibility. It is also advisable to check for general liability coverage (even though it is not mandatory); this protects against third-party bodily injuries, property damage, or personal injury claims that may arise during the project.
Insurance and bond coverage are crucial when hiring contractors in New Mexico. By verifying that your intended contractors are adequately insured and bonded, you protect yourself from potential liabilities and financial losses resulting from project-related accidents, property damage, or contractual breaches. Note that insurance and bonds provide distinct types of protection. Insurance protects you and your contractor by covering the cost of project-related accidents, property damage, and contractor errors. On the other hand, bonds protect you from financial losses caused by the contractor's non-performance or failure to meet specific project requirements.
Therefore, always ask your intended contractors for copies of their insurance and bond certificates and authenticate these documents with the relevant issuing organizations before making any commitments.
Contact the state's Regulation and Licensing Department (NMRLD) at (505) 476-4700, (505) 222-9801, and (575) 524-6320 for inquiries concerning New Mexico contractors' insurance and bond requirements.
Top Home Improvement Scams in New Mexico
Issues involving unsatisfactory home improvement and repair services regularly rank among the top ten consumer complaint categories in New Mexico and across the country. Therefore, when planning home improvement projects, always watch out for unscrupulous contractors and con artists looking to pull a fast one on you.
Some schemes and tactics that unscrupulous contractors use when trying to scam homeowners include the following:
- Going door-to-door offering their services
- Using high-pressure sales or scare tactics to rush homeowners into making a decision
- Providing unrealistically low bids and offering limited-time-deals or exclusive deals that can only be claimed if they are hired immediately
- Lying about their license, bond, and insurance status
- Demanding large upfront payments or full payment before starting the project
- Downplaying the importance of written contracts or offering contracts with vague or one-sided terms
- Deliberately doing a poor job so you have to call them back
You can protect yourself from these fraudulent contractors by taking the following actions:
- Do not hire door-to-door contractors.
- Get and compare quotes from up to three contractors.
- Always verify your intended contractor's license status. Do the same for their insurance and bond coverage.
- Insist on a well-detailed contract and thoroughly review it before signing.
- Do not make a large upfront payment, and avoid cash payments. Consider coming up with a payment schedule that ties payments to project milestones.
- Request and check references. Be wary of contractors who cannot provide up to three local references.
- Always trust your instincts.
How to Report Fraudulent New Mexico Contractors
If you encounter unscrupulous or fraudulent contractors in New Mexico or fall victim to their scams, the following agencies can help you take action and seek remedies against these contractors:
The New Mexico Regulatory and Licensing Division
You can report matters involving unsatisfactory service delivery and unlicensed contracting to the NMRLD by completing and submitting a Request for Investigation form to this agency online.
The New Mexico Attorney General's Office
You can report contract disputes, deceptive business practices, and home improvement scams to the state's Attorney General's Office either online via its Electronic Complaint Submission portal or by downloading, completing, and submitting a paper complaint form to:New Mexico Attorney General's Office
Advocacy and Intervention Division
P.O. Drawer 1508
Santa Fe, NM 87504-1508
Note that this office cannot act as your private attorney or take legal action to represent you personally.
You can seek monetary compensation against the contractor named in your complaints by filing a small claims case against them at your local Magistrate Court (or the Bernalillo Metropolitan Court if you reside in Bernalillo County). These courts provide a quick and cost-effective process for resolving monetary disputes of up to $10,000; matters involving more than $10,000 will have to be filed at an appropriate District Court. Contact your local court for more information on filing small claims cases, including required filing fees.
The Better Business Bureau (BBB)
Your local BBB chapter can provide valuable assistance when dealing with fraudulent contractors by helping you seek redress against these contractors. The BBB also helps raise awareness among local homeowners by alerting them to fraudulent contractors in the area.
Local Law Enforcement Agencies
In addition to the mentioned agencies, it's crucial to report threats, theft, and other criminal activities by contractors to your local law enforcement agency.