In residential construction, the contractor is almost always responsible for pulling permits. Industry custom puts the duty on them, and the standard contracts used across the country say so in plain language. But the document that actually decides whether the contractor is responsible for permits on your project is the contract you signed, so that is where to look first.
Your Contract Is What Actually Decides
The most widely used construction agreements in the United States assign permits to the contractor explicitly. The AIA A201-2017 General Conditions states that “the Contractor shall secure and pay for the building permit as well as for other permits, fees, licenses, and inspections by government agencies necessary for proper execution and completion of the Work.”1DC Housing. A201-2017 General Conditions of the Contract for Construction The AIA’s residential forms use nearly identical wording, requiring the builder to “obtain and pay for the building permit and other permits and governmental fees, licenses and inspections necessary for proper execution and completion of the Work.”2AIA Contract Documents. Who is Responsible for Obtaining Permits on Residential Construction Projects
If your contractor hands you a custom contract instead of a standard form, read it carefully. Look for a clause that names who obtains and pays for permits. When the contract is silent, you are in a gray area where your local jurisdiction may hold the property owner responsible by default, because the permit attaches to the property rather than to the contractor’s license. Before signing, confirm that a permit clause exists and that it puts the duty on the contractor. One paragraph of contract language can save you thousands of dollars later.
Why the Contractor Is the Right Party
Beyond the contract, there are practical reasons the contractor should handle permits. Contractors know which permits a project actually needs. A kitchen remodel can require separate building, electrical, plumbing, and mechanical permits, and a homeowner who pulls only one may face a stop-work order when the inspector realizes the others are missing. Contractors also prepare the construction drawings and specifications that building departments require with permit applications, and they understand local submission rules that vary from one jurisdiction to the next.
Licensed contractors have a professional reason to follow the rules. In many states, performing work without required permits is grounds for license suspension, revocation, or fines. A contractor who routinely skips permits is risking their livelihood, which creates a layer of accountability that does not exist when a homeowner handles the process alone.
Verify That Your Contractor Actually Pulled the Permit
This is where most permit problems originate. A homeowner hires a contractor, the contract says the contractor handles permits, and the homeowner assumes it is done. Months later, they learn no permit was ever filed. Trust, then verify.
Most local building departments maintain online permit databases searchable by address. A quick search should show any active permits on your property, when they were issued, and what type of work they cover. If your jurisdiction does not offer an online portal, call the building department with your property address. The AIA residential contracts require the contractor to provide copies of all permits, licenses, and inspection approvals to the owner.2AIA Contract Documents. Who is Responsible for Obtaining Permits on Residential Construction Projects Ask to see the actual permit before work begins, and confirm it is posted at the job site as most building codes require.
Also confirm the permit matches the scope of the project. A contractor who pulls a permit for “minor electrical work” on what is actually a full gut renovation has not properly permitted the job. The permit description should reflect what is being built.
If Your Contractor Skipped the Permit
Discovering that your contractor performed work without pulling required permits is one of the more frustrating situations a homeowner can face, but you have options. Start by demanding that the contractor obtain the permit immediately. If the contract required them to handle permits, their failure to do so is a breach, and you are within your rights to withhold remaining payments until the issue is resolved.
If the contractor will not cooperate, file a complaint with your state’s contractor licensing board. Performing work without required permits is a serious violation in most states and can result in license suspension, fines, or revocation. You can also report the violation to your local building department. You may have grounds to sue for breach of contract and recover the cost of obtaining retroactive permits, any demolition and reconstruction required to pass inspections, and other damages flowing from the failure.
Under the AIA General Conditions, a contractor who knowingly performs work contrary to applicable laws and codes “shall assume appropriate responsibility for such Work and shall bear the costs attributable to correction.”1DC Housing. A201-2017 General Conditions of the Contract for Construction Even without that specific language, the general principle is the same: a contractor who agreed to handle permits and did not is on the hook for the consequences. Document everything, including the original contract terms, any communications where the contractor acknowledged permit responsibility, and the costs you incur to fix the situation.
When a Homeowner Pulls the Permit Instead
Most jurisdictions allow property owners to obtain an “owner-builder” permit, which lets you act as your own general contractor. This can sound appealing for saving money on smaller projects, but it carries real obligations.
When you sign a permit application as an owner-builder, you take on full responsibility for every phase of the project. You are responsible for ensuring the work meets building codes, scheduling and passing all required inspections, supervising subcontractors, and coordinating the sequence of work. If you hire workers who are not licensed subcontractors, you may be classified as an employer under state and federal law, which triggers obligations for tax withholding, Social Security contributions, workers’ compensation insurance, and unemployment insurance.3Contractors State License Board. The Responsibilities Of An Owner-Builder
Workers’ compensation is the issue that trips up the most people. When a licensed contractor pulls the permit, their workers’ comp policy covers injuries on the job site. When you pull the permit as an owner-builder and a worker is hurt, you can be personally liable for medical bills and lost wages, and your homeowner’s insurance almost certainly will not cover it. Owner-builder permits make sense for homeowners with genuine construction knowledge who plan to do most of the work themselves. For everyone else, paying a contractor to handle the permit and the liability that comes with it is usually the better deal.
What Happens If the Work Goes Unpermitted
Building without a permit is not a gamble that quietly resolves itself. Local building authorities can issue a stop-work order that halts all construction until proper permits are obtained. The standard penalty in many areas is a fine equal to double or triple the original permit fee, on top of the permit fee itself, and monthly fines can accumulate until the violation is resolved.
The more expensive consequence is what happens to the physical work. Inspectors who cannot verify that concealed work meets code may require you to open up finished walls, ceilings, or floors so electrical, plumbing, and structural elements can be examined. If the work does not meet current codes, you will need to tear it out and redo it. The cost of demolishing and rebuilding finished work dwarfs whatever the permit would have cost in the first place.
Unpermitted work also creates lasting problems for the property. When you sell, most buyer’s agents and lenders will flag additions or renovations that do not match permit records. Many states require sellers to disclose known unpermitted work, and buyers who discover it after closing can sue for damages based on the nondisclosure. Unpermitted work that increases a home’s square footage or value can also create back-tax liability when the county assessor catches up.
Insurance Risks
Homeowner’s insurance and unpermitted work are a dangerous combination. If damage occurs because of unpermitted work, your insurer can deny the claim entirely. An electrical fire in an unpermitted room addition is a textbook example: the insurer will argue the work was never inspected and did not meet code, and refuse to pay. An insurer that discovers unpermitted work during an inspection or claim investigation may also cancel your policy or refuse to renew it. Some insurers will exclude coverage for portions of a home with known unpermitted modifications while continuing to cover the rest of the structure.