Before becoming a licensed contractor in North Carolina, you may be required to obtain a contractor license bond. This surety bond guarantees compensation to those harmed by the contractor’s breach of contract or unlawful actions while performing construction work. Its purpose is to protect clients, subcontractors, and the public.
Below, we’ll cover everything you need to know about securing a North Carolina contractor license bond, including who needs one, how much they cost, and how to apply in just a few easy steps.
North Carolina Contractor Bonding Requirements
In North Carolina, general contractors must meet minimum financial requirements to ensure they can handle the scope of their projects. If a contractor doesn't meet the required net worth or working capital thresholds, the North Carolina Licensing Board for General Contractors (NCLBGC) allows them to post a surety bond instead.
Contractor license bond amounts vary by license type:
- $175,000 bond for a Limited license, where the contractor can undertake projects of up to $750,000
- $500,000 bond for an Intermediate license, where the contractor can undertake projects of up to $1,500,000
- $1,000,000 bond for an Unlimited license, where the contractor can undertake projects of any size
License classifications in the general contractors group include: Building, Residential, Highway, Public Utilities, Specialty, and Unclassified. More details on the classifications, limitations, and surety bond requirements and exemptions can be found on the NCLBGC website.
Other licensing boards in North Carolina also require surety bonds:
- The NC State Board of Examiners of Electrical Contractors (NCBEEC) requires electrical contractors to have a statement of bonding ability based on their license type:
- Intermediate statement of bonding ability for electrical contractors with projects of above $60,000
- Unlimited statement of bonding ability for electrical contractors with projects of more than $150,000
- The NC Landscape Contractors’ Licensing Board (NCLCLB) requires a $10,000 landscape contractor bond.
- The NC Irrigation Contractors’ Licensing Board (NCICLB) also requires a $10,000 irrigation contractor bond.
Other cities and counties in North Carolina might require separate bonds for local permits or licenses.
Bryant Surety Bonds makes it easy to get your North Carolina contractor license bond at competitive rates.
How Much Does the North Carolina Contractor Bond Cost?
The NC contractor bond cost, also referred to as the bond premium, is a small percentage of the bond amount. This percentage is primarily determined by your credit history and overall financial standing.
Contractors with good credit typically qualify for rates ranging from 1% to 3% of the total bond value. For instance, if you need a $10,000 contractor bond, your annual premium may range from $100 to $300. This amount is paid each time you renew your bond.
Several key factors affect your bond rate, including:
- Personal credit profile
- Business financial health
- Cash reserves and assets
- Experience in the industry
The table below lists some of the most common contractor license bonds in North Carolina, including their required amounts and starting costs.
If you're uncertain about the type of bond you need, complete our online form and we’ll find your specific contractor bond requirements and provide you with a free exact quote.
| Bond Type | Bond Amount | Bond Cost |
|---|---|---|
| State-Level Bonds | ||
| Limited Contractor License Bond | $175,000 | Starting from $1,750 |
| Intermediate Contractor License Bond | $500,000 | Starting from $5,000 |
| Unlimited Contractor License Bond | $1,000,000 | Starting from $10,000 |
| Intermediate Statement of Bonding Ability for Electrical Contracting Projects in excess of $60,000 | $60,000 | Starting from $120 |
| Unlimited Statement of Bonding Ability for Electrical Contracting Projects in excess of $150,000 | $150,000 | Starting from $300 |
| Landscape Contractor Bond | $10,000 | Starting from $100 |
| Irrigation Contractor Bond | $10,000 | Starting from $100 |
| Modular Building Set-up Contractor Bond | $5,000 | Starting from $100 |
| Manufactured Home Set-Up Contractor Bond | $10,000 | Starting from $100 |
| Municipality-Specific Bonds | ||
| City of Charlotte Land Development Services Bond | $1,000 - $100,000 | Starting from $100 |
| City of Fayetteville Stormwater Control Bond | $1,000 - $250,000 | Starting from $100 |
| City of Greensboro Contractor Bond (Electrical, Plumbing, Mechanical, Refrigeration, HVAC, Concrete) | $2,000 | Starting from $100 |
| City of Greensboro Contractor Bond (Demolition, Grading, House Moving) | $5,000 | Starting from $100 |
| City of High Point Stormwater Bond | $1,000 - $100,000 | Starting from $100 |
| City of Raleigh Contractor Bond for Work in Public Streets | $5,000 | Starting from $100 |
| City of Winston-Salem Contractor Bond (Electrical, Heating, or Plumbing) | $2,500 | Starting from $100 |
| City of Winston-Salem Contractor Bond (Concrete) | $5,000 | Starting from $100 |
| City of Winston-Salem Street, Bridge, and Sidewalk Contractor Bond | $25,000 | Starting from $250 |
| Gaston County Contractor Bond | $1,000 - $100,000 | Starting from $100 |
| Highway Encroachment Installation Performance and Indemnity Bond | $1,000 - $100,000 | Starting from $100 |
| Mecklenburg County Attachment to Land Development Bond | $2,001 - $100,000 | Starting from $100 |
| Mecklenburg County Land Use and Construction Bond | $1,000 - $100,000 | Starting from $100 |
| Stanly County Contractor License Bond | $10,000 | Starting from $100 |
| Stormwater Ordinance Bond | $1,000 - $100,000 | Starting from $100 |
| Town of Holly Ridge House Moving Bond | $500 | Starting from $100 |
| Town of Kitty Hawk Contractor Bond | $5,000 | Starting from $100 |
| Town of Southern Shores Contractor Bond | $5,000 | Starting from $100 |
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Get a free exact quote Get another estimateContract Bonds in North Carolina
Some North Carolina general contractors may also be required to obtain contract bonds, such as performance or payment bonds. These are typically needed when you're already licensed and working on a specific construction project.
Contract bonds guarantee that the contractor will:
- Complete the project on time
- Fulfill the terms of the contract without breaches
- Pay all subcontractors, employees, and material suppliers
Unlike license bonds, construction-based bonds remain valid for the duration of the project, and the premium is paid once upfront.
How to Get a North Carolina Contractor License Bond
Getting bonded is simple. Here’s how it works:
- Complete our quick online application, sharing basic details like business and contact information.
- Receive a free quote from the surety company on the same day you apply.
- Accept the quote. You’ll receive proof of bonding to include with your license application or renewal.
To maintain your license and stay compliant with state laws, remember to renew your contractor license bond before it expires. Bryant Surety Bonds will send you a reminder ahead of time, ensuring you have ample time to complete the renewal and avoid any disruptions.
What You Need Before Applying for a Bond
Before applying for a contractor license bond in North Carolina, you’ll need to complete a few key steps:
- Register Your Business: Make sure your business is properly registered with the North Carolina Secretary of State. You’ll also need a valid EIN from the IRS.
- Determine Your License Type and Classification: Choose the appropriate general contractor license (Limited, Intermediate, or Unlimited) or determine if a specialized license applies to your trade (e.g., electrical, irrigation, or landscape).
- Undergo a Financial Review: When applying with the North Carolina Licensing Board for General Contractors or another relevant licensing institution, your working capital and net worth will be evaluated. If you don’t meet the financial minimums, you’ll need to secure a surety bond instead.
Not sure where to begin with licensing? In our comprehensive North Carolina Contractor Licence Guide, you will find everything you need to know about the process.
FAQs
What happens when a claim is filed against my bond?
Bryant Surety Bonds provides claims assistance to guide you through the process and help protect your interests.
When a claim is filed, the surety company will first investigate to determine its validity. If the claim is found to be legitimate, meaning you violated the conditions of your bond, the surety will compensate the claimant up to the full bond amount.
As the bonded contractor, you are then required to reimburse any money paid out on your behalf.
Can I get bonded with bad credit?
Yes, you can still get bonded in North Carolina even if you have less-than-perfect credit. However, applicants with lower credit scores may be subject to a higher bond premium rate, as surety companies often require additional financial assurances.
At Bryant Surety Bonds, we offer a Bad Credit Surety Bond Program specifically designed to help contractors with challenged credit obtain the bond they need to get licensed.
When do contractor bonds expire in North Carolina?
Contractor bond expiration dates in North Carolina vary by license type. Here’s a breakdown:
- General contractor licenses and bonds expire on January 1 each year. To remain licensed, both must be renewed by December 31.
- Electrical contractor licenses and bonds expire one year from the date of issuance. Renewal applications must be submitted at least 30 days before the expiration date.
- Landscape contractor licenses and bonds must be renewed on or before August 1 each year.
- Irrigation contractor bonds expire annually along with the license and must be renewed on or before December 31 each year.
To avoid lapses in coverage or licensure, be sure to track your expiration date and start the renewal process well in advance.
How long does it take to get a contractor bond in North Carolina?
At Bryant Surety Bonds, most applicants receive their North Carolina contractor license bond the same day they apply. However, approval times can vary depending on your credit profile and the type of license required.
In many cases, getting bonded is instant, especially for applicants with strong credit. For more complex applications, it may take a few business days due to additional underwriting review.
Additional Resources
- North Carolina Licensing Board for General Contractors: New License/General License Questions
- North Carolina Licensing Board for General Contractors: Classifications and Limitations
- Landscape Contractors Statute
- North Carolina Irrigation Contracting Laws and Regulations
