How to Become a Contractor in New Mexico – Get a contractor license in NM

If you’re looking for clean and clear directions on how to become a contractor in New Mexico, look no further. This article will break down NM contractor licenses and how to apply for one through the following steps. 

  1. Determine Your Classification
  2. Select Your Qualifying Party
  3. Apply for Examination
  4. Submit All Required Documentation

Do You Need a Contractor License in New Mexico?

Any person or business undertaking contractor work is required to be licensed in New Mexico. Contractor work is defined as altering, fixing, installing, demolishing, or building roads, buildings, transportation centers, paths, parks, reservoirs, sewer systems, radio towers, HVAC systems, electrical wiring, and all other related structures or zones. A comprehensive definition can be found here.

Examinations are given through PSI Exams and licenses are issued by the New Mexico Construction Industries Division (CID). 

Getting Your NM Contractor License

Unlike most other states, New Mexico has given PSI Exams the authority to preapprove individuals for contractor licensing exams. This means individuals will apply with PSI instead of with the state before taking the official exam needed for licensure.

Once the exam is passed, you’ll need to submit certain documents to the state through PSI – including your passing marks – to receive your contractor’s license. This process could take some time and has further requirements you should meet, discussed below.

  1. Determine Your Classification

New Mexico offers plenty of classifications when it comes to contractor licenses. They are generally divided into General Construction, Electrical, and Mechanical/Plumbing classifications. 

General Construction licenses include – but are not limited to – the following classifications:

  • Maintenance and repair
  • Residential 
  • General building
  • General specialties (with subclassifications)
    • Siding
    • Masonry
    • Roofing
    • Demolition
    • And more…

For a full list of classifications and their respective work requirements, see here. 

Each classification has work experience requirements you must fulfill for PSI approval for examination. Contractors can be licensed in multiple classifications, but they will need to take the appropriate exam and apply for each classification separately. 

The work requirements will need to be fulfilled by the Qualifying Party, discussed next under step #2.

If you’re not sure which classification you qualify for, you can send in the Classification Determination Request to PSI Exams for clarification. 

It’s also important to note that your business name should be approved by PSI before registering it with the NM Secretary of State, if not registered already. You will need an original name that matches the scope of your classification and work. 

  1. Select Your Qualifying Party

NM contractor licenses are granted to businesses that are owned by or employ a Qualifying Party. Qualifying Parties are individuals who meet the license requirements, take and pass the appropriate PSI exam, and oversee all contract work once licensed. All experience by the Qualifying Party must be within the last decade and performed under a licensed contractor to count towards the exam requirements. 

Qualifying Parties must also not have outstanding debts for child support, CID fines, permit fees, or unresolved complaints with the CID.

Once you confirm your Qualifying Party is eligible for their contractor classification exam, they will need to apply for preapproval to take the exam. To do so, submit a Qualifying Party application to PSI. 

This application must be neatly completed, signed, and notarized. It should include a work experience verification form, a $30 application fee plus $6 for each classification, and a self-addressed stamped envelope with return postage (in case your application is rejected). 

Send your completed application to:

PSI

2820 Broadbent Pkwy NE, Suite E&F

Albuquerque, NM 87107

If your preapproval application is approved, you and/or the Qualifying Party will be notified of how to schedule and pay for the contractor’s exam. You must take and pass the exam within six months of your exam approval. If not, after six months you’ll need to pay for an extension of this preapproval. 

  1. Pass the Examination

Once the Qualifying Party has been approved to take the exam, they will schedule a 2-part contractor’s exam through PSI, plus an additional exam for each additional classification they wish to be licensed in. 

Part one is the Business and Law test for contractors. This exam is 50 questions given over a maximum time of 130 minutes. You need a 74% (38 correct questions) to pass. This exam is open book. Alternatively, candidates could also take the Business and Law course by an approved vendor as a replacement for this exam. 

The second part will be the trade exam, which depends on the classification you want. See the official PSI Candidate Bulletin for information on all classification exams, including their requirements, exam length, and which reference books are accepted.

  1. Submit All Required Documentation

Once you’ve passed all of your exams, you will hand in your original passing score sheets with either a Contractor License Application or a Status Change form. This must be done within a year of your exam or you’ll have to request an extension or a retest. 

The Contractor License Application should include:

  • Copies of your Qualifying Party Certificate (exam preapproval) or a copy of the passing exam scores
  • Proof of your financial responsibility in the form of a bond worth $10,000
  • Your New Mexico Tax ID number
  • Your registration with the NM Secretary of State, if applying as a corporation, limited partnership, LLC, or LLP
  • A large, self-addressed envelope with sufficient postage – this will be used to either mail back your denied application or your new license if approved
  • A copy of your appropriate Worker’s Comp, if applicable
  • A $300 or $150 fee, depending on the classification – see page 7 of the application 

Mail or deliver all documentation and the completed application to:

PSI 2820 Broadbent Pkwy NE, Suite E&F

Albuquerque, NM 87107

Once approved, your new license will be mailed to you. 

New Mexico Contractor License Renewals

New Mexico contractor licenses are valid for three years. You should renew before your expiration date and will receive a renewal application to the address you filed with on your application. Late renewals will incur varying late fees and any licenses not renewed 90 days after expiration will be canceled. 

Renewal applicants will need to complete a notarized application, have a valid code bond on file, pay a renewal fee, and include a self-addressed envelope with postage. More detailed instructions can be found on the renewal application itself.

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