Kentucky Contractor Financing Guide
Everything you need to know about offering customer financing in Kentucky: licensing, platforms, bonding, insurance, and compliance requirements.
Last Updated: January 2025
Quick Summary for Kentucky Contractors
- ✓ No state-level general contractor license required (locally regulated)
- ✓ HVAC, electrical, and plumbing contractors require state licensing
- ✓ Roofing contractors: no state license, local licenses may apply
- ✓ All major financing platforms available (GreenSky, Synchrony, PowerPay, etc.)
- ✓ Insurance requirements vary by municipality ($250K-$1M general liability typical)
- ✓ Louisville and Lexington have specific bonding requirements
On This Page
Licensing Requirements by Trade
Kentucky has a unique licensing structure: general contractors are not licensed at the state level. The state only handles licensing for specific trades (HVAC, electrical, plumbing), while general contractor licensing is regulated locally by counties and cities.
HVAC Contractors
State licensing REQUIRED through the Kentucky Department of Housing, Buildings, and Construction.
License Types:
- Master HVAC Contractor - Can operate business and supervise work
- Journeyman HVAC Mechanic - Can perform work under supervision
- Registered Apprentice - Must work under licensed contractor
Requirements:
- ✓ Pass Business and Law exam
- ✓ Pass technical HVAC knowledge and codes exam
- ✓ General liability insurance: $500,000 minimum
- ✓ Property damage insurance: $300,000 minimum
- ✓ 6 hours continuing education per renewal
Fees:
- Application Fee: $145.83 - $375 (varies by timing)
- Journeyman Annual Fee: $50
- Master Contractor Annual Fee: $250
Roofing Contractors
No state-level license required for roofing contractors. However, local requirements may apply.
What This Means:
- Check with your specific city/county for local licensing
- Many roofers seek certification from Kentucky Roofing Contractors Association (KRCA)
- KRCA members typically need:
- ✓ $10,000 surety bond
- ✓ $1 million general liability insurance
General Contractors & Home Improvement
No state-level license required. Regulated at the local level by individual municipalities.
Important: You MUST check with your local city or county building department for specific requirements. Louisville, Lexington, and other major cities have their own licensing and bonding requirements.
Financing Platforms Available in Kentucky
All major contractor financing platforms operate in Kentucky. Here's what's available and their typical requirements:
GreenSky
Available in KYOne of the largest contractor financing platforms. Acquired by Goldman Sachs in 2022.
Typical Requirements
- ✓ 2+ years in business
- ✓ Professional website
- ✓ Valid business license (where applicable)
- ✓ Proof of insurance
- ✓ Clean business credit history
Loan Features
- Loan amounts up to $100,000
- Deferred interest promotional periods
- Works through contractor merchants
Synchrony Home
Available in KYMajor financing provider for home improvement contractors.
Typical Requirements
- ✓ Established contractor business
- ✓ Professional online presence
- ✓ Required licensing and insurance
- ✓ Good business standing
Loan Features
- Flexible promotional financing options
- Fast credit decisions
- Multiple payment plans
PowerPay
Available in KYPopular with HVAC and home improvement contractors.
Typical Requirements
- ✓ 1+ years in business
- ✓ Website with business information
- ✓ Valid contractor credentials
- ✓ Insurance verification
Loan Features
- Credit limits up to $55,000
- Instant credit decisions
- Same-day funding
Other Platforms Available in Kentucky:
Insurance & Bonding Requirements
Kentucky insurance and bonding requirements vary significantly by trade and municipality. Here's what you need to know:
State-Level Requirements
HVAC Contractors (Required by State):
- General Liability: $500,000 minimum
- Property Damage: $300,000 minimum
All Contractors with Employees:
- ✓ Workers' Compensation (KRS Chapter 342)
- ✓ Unemployment Insurance (KRS Chapter 341)
What Financing Platforms Typically Require
Most financing platforms want to see you carry adequate insurance to protect customers and their investment:
- ✓ General liability: $500,000 - $1,000,000
- ✓ Workers' compensation (if you have employees)
- ✓ Valid business license (where required)
- ✓ Proof of bonding (if required by municipality)
Local Municipality Requirements
Since Kentucky doesn't require state-level licensing for general contractors, local requirements are critical. Here are the requirements for Kentucky's major cities:
Louisville/Jefferson County
The Louisville Metro Department of Codes and Regulations requires contractors to be bonded and insured.
Requirements:
- ✓ General liability insurance: $250,000 per person per occurrence
- ✓ Aggregate coverage: $500,000
- ✓ Workers' compensation insurance (if applicable)
- ✓ Unemployment insurance compliance
- ✓ Policy must include 30-day cancellation notice provision
Lexington
Liability Insurance Requirements:
- General Contractors: $500,000 per occurrence
- General Contractors (Residential Only): $250,000 per occurrence
- Specialty Contractors: $100,000 per occurrence
Working in Other Kentucky Cities?
Always check with the local building department or city clerk in the municipality where you'll be working. Requirements can vary significantly across the state.
Compliance Checklist for Offering Financing
Before You Apply to Financing Platforms:
- ✓ Obtain required state license (HVAC, electrical, plumbing contractors)
- ✓ Obtain local business license/permit for your municipality
- ✓ Secure general liability insurance (minimum $500,000 recommended)
- ✓ Obtain bonding if required by your city/county or trade association
- ✓ Set up Workers' Compensation (if you have employees)
- ✓ Create professional business website with:
- → Business address and contact information
- → Services offered
- → License number display (where applicable)
- → Insurance information
- → Professional business email (not Gmail)
- ✓ Register business structure (LLC, Corporation, etc.)
- ✓ Establish business bank account
- ✓ Build good business credit history (2+ years preferred)
How to Apply for Financing Programs
Once you've met the compliance requirements above, here's the typical application process:
Identify Your Best Platforms
Use our Platform Matcher tool to see which financing programs you're most likely to qualify for based on your business age, revenue, and credit.
Prepare Your Documentation
Have these ready before starting applications:
- → Business license/registration
- → Insurance certificates
- → EIN/Tax ID
- → Business bank account info
- → Website URL
- → 2+ years of revenue (if available)
Submit Applications
Apply to 2-3 platforms at once to compare dealer fees and terms. Check our Application Guide for step-by-step walkthroughs of each platform.
Get Approved & Set Up
Most platforms provide approval within 1-3 business days. Once approved, you'll receive training materials and point-of-sale tools to start offering financing to customers.
What You Can (and Cannot) Say About Financing
Once approved for financing programs, you become a merchant/dealer for those lenders. This means you have legal responsibilities under the Truth in Lending Act (TILA) and Regulation Z. Understanding these rules protects both you and your customers.
CRITICAL: Deferred Interest Is NOT "Same as Cash"
Never call a deferred interest promotion "same as cash." This is one of the most common compliance violations.
Why? With deferred interest, interest accrues from day one. If the customer doesn't pay off the full balance before the promotional period ends, they owe ALL the interest that accumulated.
What You MUST Disclose to Customers
1. The Full Promotional Period Length
"If paid in full within 12 months" or "18-month promotional period"
2. That Interest Is Accruing
"Interest is charged from the purchase date if the promotional balance is not paid in full within the promotional period."
3. Minimum Monthly Payments Required
Customers must make minimum monthly payments during the promotional period or they lose the promotional rate.
4. The Actual APR (If Deferred Interest)
If they don't pay in full, what rate will they be charged? (Often 20-30% APR)
What You CANNOT Say
"Same as cash"
Deferred interest programs accrue interest from day one.
"No interest" (without the qualifier)
Must say "No interest if paid in full within [X] months"
"Everyone gets approved"
False representation. Approval is based on creditworthiness.
What You CAN (and Should) Say
"We offer flexible payment options through [Lender Name]"
Honest, straightforward, compliant.
"If paid in full within 12 months, no interest will be charged"
Accurate description with proper qualifier.
"Subject to credit approval"
Always include this disclaimer.
Best Practices for Compliance
- ✓ Always provide customers with written disclosures at point of sale
- ✓ Never rush customers through the financing paperwork
- ✓ Keep copies of all signed financing documents for your records
- ✓ Use only the marketing materials provided by your financing partner
- ✓ Update your team training annually on compliance requirements
Need a Financing-Ready Website?
We build websites that meet every financing platform's requirements and walk you through the entire application process.