The residential construction and home remodeling industry in Michigan is experiencing unprecedented demand, fueled by historic housing inventory shortages, urban revitalization projects across Metro Detroit, and extensive suburban development in West Michigan.

However, Michigan maintains some of the strictest contractor consumer protection statutes in the country. Operating under Article 24 of the Michigan Occupational Code (Public Act 299 of 1980, MCL § 339.2401 et seq.), the state strictly prohibits uncertified individuals from undertaking residential projects exceeding $600 in total value.

Securing a Michigan Residential Builder License from the Department of Licensing and Regulatory Affairs (LARA) unlocks substantial commercial earnings, establishes credibility, and provides the vital legal right to file construction liens against non-paying clients.

Here is the complete regulatory, statutory, and examination roadmap to obtaining and maintaining a Michigan residential builder license in 2026.

Step 1: Choosing Your Credential — Full Builder vs. M&A Contractor

Before enrolling in coursework, candidates must choose between two distinct credentials issued by the LARA Bureau of Construction Codes:

                  MICHIGAN RESIDENTIAL CONTRACTOR CREDENTIALS
                                       │
           ┌───────────────────────────┴───────────────────────────┐
           ▼                                                       ▼
   Residential Builder License                           Maintenance & Alteration (M&A)
   • Can build complete residential structures           • Restricted to specific craft trades:
     from the ground up.                                   Roofing, Siding, Masonry, Carpentry,
   • Manages whole-home additions and                    • Cannot perform general structural
     coordinates licensed mechanical subs.                 contracting outside certified trades.

1. Individual Residential Builder License: The comprehensive credential. Authorizes the licensee to construct new single-family homes, multi-family residential structures up to three stories, execute major room additions, perform structural renovations, and pull general building permits across all Michigan municipalities.
2. Maintenance & Alteration (M&A) Contractor License: Intended for specialized subcontractors. Your license will display specific trade crafts for which you have tested, such as:
3. Roofing;
4. Siding, Gutters, and Downspouts;
5. Masonry and Concrete;
6. Basement Waterproofing;
7. Carpentry and Cabinetry;
8. Insulation. An M&A contractor cannot contract for general home building or structural work outside their designated trade specialties.

Step 2: The Mandatory 60-Hour Prelicensure Course (MCL § 339.2404b)

Under Michigan statute, no candidate may sit for the state licensing exam without first completing 60 hours of approved prelicensure education from an accredited sponsor (such as the Home Builders Association of Michigan, Builders License Training Institute, or Michigan Construction Academy).

Under MCL § 339.2404b, the 60-hour curriculum must allocate hours across eight precise statutory subjects:

Upon completion, the educational provider issues a formal certificate of completion and electronically transmits verification to LARA. Course certificates remain valid for 36 months.

Step 3: Passing the PSI State Builder Examination

Michigan contracts examination administration to PSI Services LLC, which operates computer-based testing centers in Southfield, Grand Rapids, Lansing, Gaylord, and Marquette.

The examination consists of two independent parts, both of which must be passed:

                  THE TWO-PART PSI BUILDER EXAMINATION
                                    │
        ┌───────────────────────────┴───────────────────────────┐
        ▼                                                       ▼
Part 1: Business and Law Examination              Part 2: Practice and Trade Examination
• 50 Multiple-Choice Questions                   • 110 Multiple-Choice Questions
• 75 Minutes Time Limit                          • 180 Minutes (3 Hours) Time Limit
• Minimum Passing Score: 72% (36 / 50)           • Minimum Passing Score: 73% (80 / 110)
• Closed Book                                    • Open Book (Current Michigan Residential Code)

What Is Covered on the Exam?

• Part 1 (Business & Law): Tests knowledge of Michigan licensing laws (PA 299), Construction Lien Act procedures, MIOSHA Part 45 regulations, Workers’ Disability Compensation mandates, sales and use tax requirements, and standard construction contract terms.
• Part 2 (Practice & Trade): Tests technical blueprint interpretation, foundation excavation standards, span tables for engineered lumber, roof pitch load calculations, chimney flashing standards, and handicap accessibility requirements under the current edition of the Michigan Residential Code (MRC).

Candidates who fail one section are permitted to retake only the failed portion within a one-year eligibility window.

Step 4: Submitting the LARA MiPLUS License Application

Once PSI verifies passing scores, candidates apply online through the Michigan Professional Licensing User System (MiPLUS) managed by LARA:

1. License Fee: Pay the statutory application fee of $195.00 (covers the 3-year initial licensing cycle).
2. Qualifying Officer Designation (For LLCs/Corporations): If contracting through an LLC or corporation, the business entity must apply for a separate Company Builder License ($195), designating the individually licensed builder as the official Qualifying Officer under MCL § 339.2405. The qualifying officer assumes personal legal liability for all construction activities of the business.
3. Background & Character Clearance: Disclose any past felony or misdemeanor convictions. Under Michigan’s occupational licensing reform, past criminal history does not result in automatic disqualification unless the offense is directly related to fraud, theft, or construction malpractice.
4. Credit / Financial Review: Demonstrate general business solvency (confirming no outstanding unpaid construction judgments or bankruptcy fraud).

Continuing Competency Requirements (MCL § 339.2404b)

To maintain active licensure, Michigan builders must complete ongoing Continuing Competency hours during each 3-year renewal cycle:

• New Licensees (First 6 Years of Licensure): Must complete 21 hours of approved continuing education per 3-year cycle. This must include at least 3 hours every single calendar year, covering:
• 1 hour of Michigan Residential Code updates;
• 1 hour of MIOSHA workplace safety;
• 1 hour of construction business and law updates.
• Veteran Licensees (Licensed for 6+ Consecutive Years): The requirement drops to 3 hours per 3-year cycle, focused on code, safety, and legal changes.

Criminal & Financial Penalties for Unlicensed Contracting

Operating without a builder license in Michigan triggers severe civil and criminal liabilities:

               CONSEQUENCES OF UNLICENSED CONTRACTING (MCL 339.601)
                                      │
     ┌────────────────────────────────┼────────────────────────────────┐
     ▼                                ▼                                ▼
First Offense Criminal           Subsequent Offenses              Zero Lien Rights
Misdemeanor; fine up to $500     Felony charges; fines up         Cannot file mechanic's liens
and/or 90 days in county jail.   to $25,000 and 4 years prison.   or sue homeowners for payment!

Total Forfeiture of Construction Lien Rights (MCL § 570.1114)

Under the Michigan Construction Lien Act, a contractor can only place a legal lien against real property for unpaid labor and materials if they were properly licensed at the time the work was performed.

Michigan appellate courts have repeatedly held that if an unlicensed contractor performs $50,000 of home remodeling and the customer refuses to pay, the contractor cannot file a lien, cannot foreclose on the house, and cannot even maintain a breach-of-contract lawsuit in circuit court. Contracting without a license leaves you completely exposed to total non-payment.