NEW MEXICO CR-101 RESIDENTIAL BUILDING CONTRACTOR
EXAM COMPLETE EXAM QUESTIONS AND VERIFIED
ANSWERS | 2026–2027 LATEST UPDATE | GUARANTEED
PASS | DETAILED RATIONALES | FULL STUDY GUIDE | EXAM
PREP | PRACTICE TEST | CERTIFICATION PREPARATION
SECTION ONE — QUESTIONS 1–100
1. Which of the following best describes the primary role of the New Mexico Construction
Industries Division (CID)?
A) To provide financing for construction projects
B) To regulate licensing, permitting, and code compliance
C) To approve building blueprints
D) To establish insurance rates
Correct Answer: B) To regulate licensing, permitting, and code compliance
Rationale: The Construction Industries Division (CID) of the Regulation and Licensing Department
oversees contractor licensing, permitting, and enforcement of construction codes in New Mexico. It
ensures contractors meet state requirements and comply with construction standards. The CID does
not provide financing or set insurance rates, though it does enforce compliance with licensing laws .
2. What is the minimum annual revenue threshold below which a contractor may operate without
a license in New Mexico?
A) $5,000
B) $7,200
C) $10,000
D) $25,000
Correct Answer: B) $7,200
Rationale: Under NMSA 60-13-3(B)(14), individuals performing casual, minor, or inconsequential
work may operate without a license if total annual compensation remains at or below $7,200. This
exemption requires filing an annual declaration with CID and does not apply to electrical, plumbing,
or gas-fitting work, which always require licensure regardless of project value .
3. A contractor license in New Mexico must be renewed every:
A) One year
B) Two years
,C) Three years
D) Four years
Correct Answer: B) Two years
Rationale: New Mexico contractor licenses must be renewed every two years. Licensees must
complete renewal requirements, including continuing education, and pay applicable fees before the
expiration date. The CID mails renewal applications at least 30 days prior to expiration, but it remains
the licensee's responsibility to timely renew .
4. Who must be designated as the Qualifying Party (QP) for a New Mexico contractor license?
A) Only out-of-state contractors
B) Only large contracting firms
C) All New Mexico contractor applicants
D) Only subcontractors
Correct Answer: C) All New Mexico contractor applicants
Rationale: All New Mexico contractor license applicants must designate a Qualifying Party whose
experience qualifies the company for its classifications. The QP must have 2 years of foreman-level
experience for residential/specialty classifications (GB-2) or 4 years for general/commercial
classifications, all within the 10 years preceding application .
5. Which type of surety bond is required for New Mexico contractor licensure?
A) Performance bond
B) License bond
C) Payment bond
D) Bid bond
Correct Answer: B) License bond
Rationale: New Mexico requires a contractor license bond (surety bond) to legally operate. The bond
protects consumers from financial harm caused by contractor violations and must be issued by a
corporate surety authorized in New Mexico. The bond amount ranges from $500 to $5,000 depending
on classification .
6. What is the minimum passing score required for the New Mexico Business and Law exam?
A) 60%
B) 70%
C) 75%
D) 80%
Correct Answer: C) 75%
, Rationale: A passing score of 75% or higher is required on the Business and Law exam. The exam
consists of 50 questions with a time limit of 125 minutes. Similarly, the trade exam requires a 75%
passing score (60 correct out of 80 questions) .
7. Which activity typically requires a contractor's license under New Mexico's Construction
Industries Licensing Act (CILA)?
A) Painting a residential interior
B) Installing electrical wiring in a commercial building
C) Landscaping and lawn maintenance
D) Cleaning windows on a high-rise building
Correct Answer: B) Installing electrical wiring in a commercial building
Rationale: Installing electrical wiring is considered a contracting activity requiring a licensed
electrician, as it involves electrical systems integral to building safety and code compliance under
CILA. Interior painting, general landscaping, and window cleaning do not typically require a
contractor license unless they exceed the $7,200 threshold .
8. What is a primary consequence of contracting without a valid New Mexico contractor's license?
A) A small fine with no further penalties
B) Automatic license renewal
C) Civil and criminal penalties, including fines and potential jail time
D) No consequences if the work was completed
Correct Answer: C) Civil and criminal penalties, including fines and potential jail time
Rationale: Unlicensed contracting in New Mexico carries significant consequences. The CID can stop
construction projects immediately and file criminal charges. Additionally, unlicensed contractors
forfeit their rights to file mechanics liens and cannot file suit for payment. These penalties reflect New
Mexico's strict enforcement of licensing requirements .
9. Which of the following is NOT a license classification under New Mexico's contractor licensing
system?
A) General Building Contractor
B) Electrical Contractor
C) Real Estate Broker
D) Roofing Contractor
Correct Answer: C) Real Estate Broker
Rationale: Real estate brokers are licensed under real estate laws, not the Construction Industries
Division's contractor licensing system. General Building (GB), Electrical (EE), and Roofing contractors
are all valid construction license classifications administered by the CID under NMAC 14.6.6 .
EXAM COMPLETE EXAM QUESTIONS AND VERIFIED
ANSWERS | 2026–2027 LATEST UPDATE | GUARANTEED
PASS | DETAILED RATIONALES | FULL STUDY GUIDE | EXAM
PREP | PRACTICE TEST | CERTIFICATION PREPARATION
SECTION ONE — QUESTIONS 1–100
1. Which of the following best describes the primary role of the New Mexico Construction
Industries Division (CID)?
A) To provide financing for construction projects
B) To regulate licensing, permitting, and code compliance
C) To approve building blueprints
D) To establish insurance rates
Correct Answer: B) To regulate licensing, permitting, and code compliance
Rationale: The Construction Industries Division (CID) of the Regulation and Licensing Department
oversees contractor licensing, permitting, and enforcement of construction codes in New Mexico. It
ensures contractors meet state requirements and comply with construction standards. The CID does
not provide financing or set insurance rates, though it does enforce compliance with licensing laws .
2. What is the minimum annual revenue threshold below which a contractor may operate without
a license in New Mexico?
A) $5,000
B) $7,200
C) $10,000
D) $25,000
Correct Answer: B) $7,200
Rationale: Under NMSA 60-13-3(B)(14), individuals performing casual, minor, or inconsequential
work may operate without a license if total annual compensation remains at or below $7,200. This
exemption requires filing an annual declaration with CID and does not apply to electrical, plumbing,
or gas-fitting work, which always require licensure regardless of project value .
3. A contractor license in New Mexico must be renewed every:
A) One year
B) Two years
,C) Three years
D) Four years
Correct Answer: B) Two years
Rationale: New Mexico contractor licenses must be renewed every two years. Licensees must
complete renewal requirements, including continuing education, and pay applicable fees before the
expiration date. The CID mails renewal applications at least 30 days prior to expiration, but it remains
the licensee's responsibility to timely renew .
4. Who must be designated as the Qualifying Party (QP) for a New Mexico contractor license?
A) Only out-of-state contractors
B) Only large contracting firms
C) All New Mexico contractor applicants
D) Only subcontractors
Correct Answer: C) All New Mexico contractor applicants
Rationale: All New Mexico contractor license applicants must designate a Qualifying Party whose
experience qualifies the company for its classifications. The QP must have 2 years of foreman-level
experience for residential/specialty classifications (GB-2) or 4 years for general/commercial
classifications, all within the 10 years preceding application .
5. Which type of surety bond is required for New Mexico contractor licensure?
A) Performance bond
B) License bond
C) Payment bond
D) Bid bond
Correct Answer: B) License bond
Rationale: New Mexico requires a contractor license bond (surety bond) to legally operate. The bond
protects consumers from financial harm caused by contractor violations and must be issued by a
corporate surety authorized in New Mexico. The bond amount ranges from $500 to $5,000 depending
on classification .
6. What is the minimum passing score required for the New Mexico Business and Law exam?
A) 60%
B) 70%
C) 75%
D) 80%
Correct Answer: C) 75%
, Rationale: A passing score of 75% or higher is required on the Business and Law exam. The exam
consists of 50 questions with a time limit of 125 minutes. Similarly, the trade exam requires a 75%
passing score (60 correct out of 80 questions) .
7. Which activity typically requires a contractor's license under New Mexico's Construction
Industries Licensing Act (CILA)?
A) Painting a residential interior
B) Installing electrical wiring in a commercial building
C) Landscaping and lawn maintenance
D) Cleaning windows on a high-rise building
Correct Answer: B) Installing electrical wiring in a commercial building
Rationale: Installing electrical wiring is considered a contracting activity requiring a licensed
electrician, as it involves electrical systems integral to building safety and code compliance under
CILA. Interior painting, general landscaping, and window cleaning do not typically require a
contractor license unless they exceed the $7,200 threshold .
8. What is a primary consequence of contracting without a valid New Mexico contractor's license?
A) A small fine with no further penalties
B) Automatic license renewal
C) Civil and criminal penalties, including fines and potential jail time
D) No consequences if the work was completed
Correct Answer: C) Civil and criminal penalties, including fines and potential jail time
Rationale: Unlicensed contracting in New Mexico carries significant consequences. The CID can stop
construction projects immediately and file criminal charges. Additionally, unlicensed contractors
forfeit their rights to file mechanics liens and cannot file suit for payment. These penalties reflect New
Mexico's strict enforcement of licensing requirements .
9. Which of the following is NOT a license classification under New Mexico's contractor licensing
system?
A) General Building Contractor
B) Electrical Contractor
C) Real Estate Broker
D) Roofing Contractor
Correct Answer: C) Real Estate Broker
Rationale: Real estate brokers are licensed under real estate laws, not the Construction Industries
Division's contractor licensing system. General Building (GB), Electrical (EE), and Roofing contractors
are all valid construction license classifications administered by the CID under NMAC 14.6.6 .
