Michigan Residential Builder Exam — All Questions

Which agency licenses residential builders and maintenance & alteration contractors in Michigan?

• a.The Michigan Department of Transportation, through its construction field services offices
• b.The Department of Licensing and Regulatory Affairs (LARA), Bureau of Construction Codes✓
• c.The Michigan Department of Treasury, through the office that registers new businesses
• d.Each city's building department, with no state agency involved in builder licensing

Residential builders and M&A contractors are licensed by LARA through its Bureau of Construction Codes under Article 24 of the Occupational Code (MCL 339.2401 et seq.). Article 24 also creates the Residential Builders' and Maintenance and Alteration Contractors' Board.MCL 339.2401 et seq. (Occupational Code, Article 24)

In Michigan, the small-job exemption from residential builder licensing applies only when the total contract price for labor, materials, and other items is less than what amount?

• a.$600✓
• b.$10,000
• c.$2,500
• d.$50,000

Under MCL 339.2403(f), the exemption applies only when the total contract price for labor, materials, and other items is less than $600. A job priced at exactly $600 needs a license, and dividing a larger job into smaller contracts does not qualify. Because the trigger is so low, virtually all paid residential construction work in Michigan requires a license.MCL 339.2403(f)

How many hours of approved prelicensure courses must an applicant complete to receive an initial Michigan residential builder license?

• a.No prelicensure education is required
• b.60 hours✓
• c.16 hours
• d.8 hours

MCL 339.2404b requires 60 hours of approved prelicensure courses for an initial license. At least 6 hours must fall in each of seven areas, which include business management and estimating, contracts and risk management, the Michigan residential code, and MIOSHA construction safety.MCL 339.2404b

Which best describes the examination PSI gives for the Michigan Residential Builder license?

• a.An open-book combination exam of 160 questions in 240 minutes
• b.Two separate closed-book exams, each with its own passing score
• c.A closed-book exam of 50 Business and Law questions and nothing more
• d.A closed-book combination exam of 160 questions in 240 minutes✓

PSI gives one closed-book combination exam for the Residential Builder license. It has 160 multiple-choice questions, 50 on Business and Law and 110 on Practice/Trade, with 240 minutes allowed and a passing raw score of 116. The two sections have not been offered separately since November 14, 2019.PSI Residential Builder, M&A Contractor, and Salesperson Handbook (examination specifications)

How does a Michigan Residential Builder candidate take the 50 Business and Law questions?

• a.As a separate open-book exam that is scheduled before the trade exam
• b.As a separate closed-book exam that has its own passing score
• c.Inside the closed-book combination exam, with one passing score✓
• d.As a take-home section that is returned to the department by mail

The 50 Business and Law questions are part of the 160-question closed-book combination exam. PSI publishes one passing raw score, 116, for the whole exam. Since November 14, 2019 candidates cannot take the Business and Law or Practice/Trade sections separately, and a repeat candidate retakes the whole exam.PSI Residential Builder, M&A Contractor, and Salesperson Handbook (examination parts)

A licensed Michigan maintenance & alteration contractor applies for a Residential Builder license. What does MCL 339.2410 require?

• a.The M&A license converts to a builder license on written request
• b.The M&A examination result replaces the builder examination
• c.The applicant only needs to complete a new prelicensure course
• d.The applicant must pass the Residential Builder examination✓

Under MCL 339.2410, a qualifying officer, partner, or member who already holds a license and applies for an additional one does not have to be tested again. The exception is a maintenance & alteration contractor who applies for a Residential Builder license, who must pass the examination for that license.MCL 339.2410

Once issued, a Michigan residential builder license is generally valid for what term before renewal?

• a.Ten years
• b.Three years✓
• c.It never expires
• d.Six months

A Michigan residential builder license is issued for three years (MCL 339.2404) and must be renewed, with continuing-competency requirements, to remain active.MCL 339.2404 (three-year license term)

How does a Michigan Maintenance & Alteration (M&A) Contractor license differ from a full Residential Builder license?

• a.The M&A license is valid statewide for any residential work, while the Residential Builder license is limited to the county where the builder's office is located
• b.The M&A license is limited to the specific trade classifications listed on it, while the Residential Builder license covers building or improving residential structures generally✓
• c.There is no difference, because the two license names are interchangeable and either license covers any residential construction, alteration, or repair work
• d.The M&A license authorizes work on high-rise commercial towers, while the Residential Builder license covers only single-family homes built for the builder's own use

A Residential Builder license covers building and improving residential structures broadly, while a Maintenance & Alteration Contractor license is limited to the specific trades (for example, carpentry, roofing, or masonry) named on it (MCL 339.2404).MCL 339.2404 (M&A license limited to named trades)

A person plans to build several houses for other people for profit in Michigan. Which statement is correct?

• a.A license is required only if the price of any single home built for a buyer is more than $500,000
• b.No license is needed because houses are residential structures rather than commercial buildings
• c.A residential builder license is required because the person is building residential structures for others as a business✓
• d.Only a local building permit is required for each house, and a state license is never needed

Building residential structures for others as a business is exactly what the Residential Builder license regulates. The work is for others and no exemption applies, since the small-job exemption covers only projects under $600, so a state license is required (MCL 339.2403).MCL 339.2403 (license required for others' work)