Maryland Homeowner Guide

MHIC Complaints: What Homeowners Need to Know

What is MHIC?

The Maryland Home Improvement Commission (MHIC) licenses and regulates home improvement contractors and salespersons. It covers work involving altering, remodeling, repair, or replacement of a building (or part of a building) used as a residence.

Official MHIC info
Regulates
Contractors & salespersons
Investigates
Homeowner complaints
Enforces
Home improvement laws
A well-maintained home exterior representing homeowner protection and contractor work
Keep records before, during, and after the project to protect your rights.

The Importance of Reviewing Contracts

Your contractor will prepare a contract for you to review. Read the fine print carefully to make sure that it contains the following information:

Basic contractor information

The name, address, and MHIC license number

Dates

The approximate start and end dates of the project

Deposit/payment information

Contractors cannot ask for more than a third of the total project cost as a deposit, nor can they require you to pay the deposit before signing the contract.

Mortgage / lien language

If you have secured financing for your home improvement project, the following exact language must be included in the contract: “This contract creates a mortgage or lien against your property to secure payment, and may cause a loss of your property if you fail to pay the amount agreed upon. You have the right to consult an attorney. You have the right to rescind this contract within three business days after the date you sign it by notifying the contractor in writing that you are rescinding the contract.” Be aware that a mechanic’s lien must be filed within 180 days of work being completed.

If you found a contractor because a salesperson came to your home soliciting business, the contract must also include language required by Maryland’s Door-to-Door Sales Act. Contractors may also include an optional arbitration clause in the contract. Subcontractors aren’t required to be licensed in Maryland. They may work for contractors, but only MHIC licensed contractors may enter into a contract with a homeowner.

Homeowner tips & key protections

  • ✓ Before hiring a contractor, get a written contract that clearly states scope, timeline, payment schedule, and any lien or mortgage language.
  • ✓ Keep photographic records of your property before, during, and after work.
  • ✓ Keep receipts for materials and repairs.
  • ✓ Confirm the contractor holds required Maryland licenses.
  • ✓ Ask for references and proof of insurance.
  • ✓ Understand that a mechanic’s lien must be filed within 180 days of work being completed.
  • ✓ If a contractor abandons a job, contact legal counsel quickly to protect your rights.
  • ✓ When you hire someone for a home improvement project, you want some assurance that the work will be of good quality and conducted in a timely manner. Your contract should state the scope of the project, along with specific details about costs, payment, and timelines; but, occasionally, homeowners find that the promises included in a contract don’t come to fruition. If you suffer actual monetary losses due to a contractor’s sub-standard or incomplete work, you may file a claim with the Maryland Home Improvement Commission (“MHIC”). The MHIC oversees a Guaranty Fund, which is funded by contractors’ licensing fees. Should the MHIC find your claim to be valid, you may be reimbursed up to $20,000.

Finding Reputable Contractors

When considering contractors to handle your home improvement project, you can contact the MHIC by email or phone to check for any previous complaints for a Contractor in their records. Any complaints within the past three years will be on the record (unless the complaint was found to be unjustified or was resolved through mediation). Ask friends and family for recommendations, and make sure you get quotes from at least three contractors. You should also ask to see their credentials – don’t hire unlicensed contractors, because clients of unlicensed contractors are ineligible for compensation from the MHIC Guaranty Fund.

When to Call a Lawyer

Contact us immediately if a contractor abandons your project. Prompt action is critical to protecting your rights and securing your property. You should also call us if you suspect defective work, a mechanic’s lien is filed against your home, or you want an estate plan that protects your home for the next generation.