All Forum Posts by: Kevin Stablier

Art -

I'm not trying to circumvent any laws.  Please read the entire thread before making such accusations.  Through a helpful, non-assuming comment from a subscriber named Katie followed by my own research I discovered the answer to my question back in June.  There is a legitimate way to rehab without a contractor's license.  The answer is having the MEP trades pull the permits for their portion of the work.  The investor only needs a license for structural alterations in which case he can higher a licensed framing contractor for that.  

In any case, I've had a commercial contractor's license since 2009.  However a few months ago there were some hurdles to getting my residential license that I couldn't overcome at the time.  I've since overcome that obstacle and now have my residential license as well.  I'm also fully insured, fully and professionally operational, and I currently have 4 new residential properties under construction thanks to my persistence in procuring a million dollar investment from a funding partner.

Moral of the story : when you start from little of nothing you have to dig deep to find answers and/or avenues for overcoming whatever situation you find yourself in.  Creating a life by design and not by default requires resilience and ingenuity.  I am now well on my way to the success I was intended to achieve.  If you're already there and are truly interested in helping folks who haven't made it yet, try not to be so judgmental in your approach.  Telling people they shouldn't be in business if they can't afford it is the opposite of what I thought this site is about.  If you want to help folks become successful, then share your experience...but don't discourage people because you can't relate to their struggles and circumstances they've encountered.  It's more helpful to just remain silent.

In Louisiana, if you are acting as a general contractor for your own personal home you do not need workman's comp. However, if you are acting as GC with the intent to sell or as GC for a private owner then you must have WC even if only on yourself.  I only employ sub-contractors that are insured.  

The answer to my original inquiry is that I only need my MEP contractors to pull permits so long as there are no structural framing alterations.  Non-structural framing needs no permitting; major structural does.

I did contact the jurisdiction first.  It could be that the permitting requirement they explained to me was only required of the MEP contractors but not communicated as such.  Light bulb switched on!

Katie, thank you!  That makes sense.  So it could be that my jurisdiction only requires the MEPs have licenses just like yours.  I'll look into that...thanks again!  Great answer.

I don't want to do it illegally guys, I'm asking if there is a legitimate way...apparently there is not that anyone is aware of.  

In other words, it's an issue of volume.  If an investor rehabs say 4 or more houses per year, then the financial analysis to support the cost of workman's comp and contractor GL makes sense.  However, at less than 4 / yr it doesn't make alot of sense...that's the dilemma.  All the seminars we attend talk about effective ways to rehab houses without using your own cash which is important to most people starting out in this business.  If a new investor doesn't have a cash reserve large enough to support the cost to obtain a contractor's license, there must be another way and I'm finding that the cost to hire a GC eats up a portion of the profit large enough that a reasonable margin is not being projected.

I have no problem with permitting.  I'm just trying to find an answer, when I say "must" I'm recognizing that it's frequently done so there must be some legitimate way to accomplish that.  The jurisdictions would not be issuing permits to people without licenses unless there is some other legitimate way to accomplish permitting without a contractor's license.  In my state, the insurances required (workman's comp, etc.) to obtain a contractor's license is significantly higher than in most other states.  If an individual is a contractor as their primary occupation, they should have a contractor's license.  However I'm not sure the same is true if you are an investor who chooses to contract his own investment property.

Thanks for the comments.

I'd prefer to sub-contract everything myself; save lots of $ that way and I know it's commonly done...just not sure how people are doing it.  

Yes, I can become a licensed contractor and may do that...but then you have the expense of workman's comp insurance etc.

There must be a way the average rehabber is doing this without a license and without a licensed contractor; not everyone whose rehabbing has lots of construction background and the knowledge needed to take the contractor's licensing exam.

Hi folks!

In my jurisdiction, and I'm sure it's common in most others as well, any rehab over $50,000 in cost requires permitting and a contractor's license if your are legal entity.  If you are filing as an individual, the individual can pull one such permit every 2 years if the intent is to occupy the property as a primary residence.  Now obviously I want do more than one rehab every 2 years, so my question is what method do you use to get around this hurdle?  I know not everyone out there has a contractor's license when doing rehabs.

Thanks,

Kevin