Residential Building Contractor (GB-2)

New Mexico Residential Building Contractor License (GB-2)

The New Mexico Regulation and Licensing Department, Construction Industries Division (CID), issues the GB-2 Residential Building Contractor license. This classification authorizes the holder to erect, alter, repair, or demolish residences and apartment buildings accommodating up to four family units.

What This License Authorizes

GB-2 licensees may perform general construction work on residential structures including single-family homes, duplexes, triplexes, and fourplexes. Work includes new construction, renovations, additions, and demolition of residential buildings.

Licensing Threshold

New Mexico requires a contractor license for any construction work totaling more than $7,200 per year. Work below this threshold is exempt from licensing requirements.

Experience and Examination Requirements

Applicants must designate a Qualifying Party (QP) who has a minimum of 2 years (4,000 hours) of foreman-level practical or related trade experience within the 10 years preceding the application. The QP must pass both a trade-specific examination and a Business and Law examination administered by PSI.

Bond and Insurance Requirements

• Surety Bond: $10,000 contractor license bond required, filed with CID
• Workers' Compensation Insurance: Required for all licensed entities (corporations and LLCs must carry workers' comp even with zero employees; sole proprietors with no employees besides the owner are exempt)
• General Liability Insurance: Not required by the state, but recommended

Fees

• Application Fee: $30 (non-refundable)
• License Fee: $300 for 3 years ($100 per year)
• Exam Fee: $36 per exam (paid to PSI)

Renewal Process

• Renewal Period: Every 3 years
• Renewal Fee: $300 ($100 per year)
• Late Penalty: $1 per day for the first 30 days past the grace period; after 30 days late, a fee equal to one year's license fee ($200)
• License Cancellation: Licenses not renewed within 90 days of expiration are cancelled and require a new application
• No Continuing Education Required: There are no CE requirements for GB-2 renewal.

Consequences of Operating Without a License

Operating without a valid CID license is a misdemeanor under NMSA 60-13-52. For work valued at $5,000 or less, penalties include up to 90 days in county jail or a fine of $300 to $500, or both. For work over $5,000, penalties include up to 6 months in jail or a fine of 10% of the contract value, or both. Repeat offenders face double penalties. Unlicensed contractors cannot file mechanics liens or bring lawsuits to collect payment.

*Disclaimer: This information is provided for general reference only and does not constitute legal advice. Always verify current requirements directly with the New Mexico Construction Industries Division.*