Maryland Home Improvement PSI Practice Exam

What is required for a valid home improvement contract under Maryland law?

1. A contractor's business card.

2. A written agreement with specific terms.

3. An oral agreement is sufficient.

4. Documented referrals from previous clients.

The correct answer is: A written agreement with specific terms.

For a home improvement contract to be considered valid under Maryland law, it must be in writing and include specific terms. This requirement is designed to protect both the homeowner and the contractor by ensuring clarity and mutual understanding regarding the scope of work, payment terms, and deadlines. A written agreement reduces the possibility of misunderstandings and disputes that can arise from verbal discussions. Moreover, Maryland law mandates certain disclosures within the contract, including details about the work to be performed and other essential elements which are critical for enforceability. While a contractor's business card can serve as a form of initial identification, it does not constitute a legal agreement or contain the necessary details that define the project. Similarly, an oral agreement is insufficient for legal purposes, as it lacks the formal requirements needed for a binding contract. Documented referrals may help homeowners choose a contractor but are not a legal requirement for the establishment of a valid contract. The emphasis on a written agreement underscores the importance of clear documentation in the home improvement industry for all parties involved.