<PAGE>

                                                                    EXHIBIT 10.7

                                SECOND AMENDMENT

     SECOND AMENDMENT, dated as of November 30, 2001 (this "Amendment"), to the
Credit Agreement, dated as of May 22, 2001, as amended by the First Amendment,
dated as of June 20, 2001 (as further amended, supplemented or modified from
time to time, the "Credit Agreement"), among Integrated Electrical Services,
Inc., a Delaware corporation (the "Borrower"), certain financial institutions
which are or may become parties thereto (the "Banks"), Credit Lyonnais and The
Bank of Nova Scotia, as syndications agents, Toronto Dominion (Texas), Inc., as
documentation agent, and JPMorgan Chase Bank (formerly known as The Chase
Manhattan Bank), as administrative agent (in such capacity, the "Administrative
Agent").

                                   WITNESSETH:

     WHEREAS, pursuant to the Credit Agreement, the Banks have agreed to make,
and have made, certain loans and other extensions of credit to the Borrower;

     WHEREAS, the Borrower has requested that the Administrative Agent and the
Banks amend a certain provision of the Credit Agreement; and

     WHEREAS, the Administrative Agent and the Banks are willing to agree to the
requested amendment on the terms and conditions contained herein;

     NOW, THEREFORE, the parties hereto hereby agree as follows:

     I. Defined Terms. Terms defined in the Credit Agreement and used herein
shall have the meanings given to them in the Credit Agreement, as amended
hereby.

     II. Amendments to the Credit Agreement.

     1. Section 1.1 of the Credit Agreement is hereby amended by deleting the
definition of "EBIT" in its entirety and by substituting, in lieu thereof, the
following:

     "EBIT" means, with respect to any Person and for any period of its
determination, the consolidated net income (excluding any extraordinary gains or
losses) of such Person for such period, plus the consolidated interest expense
and income taxes of such Person for such period, provided that, notwithstanding
anything herein to the contrary, for the purposes of calculating EBIT,
impairment to goodwill calculated in accordance with FASB Statement No. 142,
Goodwill and Other Intangibles, shall be disregarded.

     2. Section 1.1 of the Credit Agreement is hereby amended by deleting the
definition of "EBITDA" in its entirety and by substituting, in lieu thereof, the
following:

     "EBITDA" means, with respect to any Person and for any period of its
determination, the consolidated net income (excluding any extraordinary gains or
losses) of such Person for such period, plus the consolidated interest expense
and income taxes of such Person for such period, plus the consolidated
depreciation and amortization of such Person for such period, provided that,
notwithstanding anything herein to the contrary, for the purposes of calculating
EBITDA, impairment to goodwill calculated in accordance with FASB Statement No.
142, Goodwill and Other Intangibles, shall be disregarded.

                                       1
<PAGE>

     3. Section 1.1 of the Credit Agreement is hereby amended by deleting the
definition of "Eligible Assignee" in its entirety and by substituting, in lieu
thereof, the following:

     "Eligible Assignee" means, with respect to any assignment hereunder, at the
time of such assignment, any commercial bank, financial institution or other
entity which, in each case, has total assets of not less than $700,000,000 and
which is approved by the Administrative Agent, the Swing Line Lender and the
Issuing Bank, and, so long as no Default or Event of Default exists, is approved
by the Borrower (in each case, such approval not to be unreasonably withheld).

     4. Section 1.1 of the Credit Agreement is hereby amended by deleting the
definition of "Net Worth" in its entirety and by substituting, in lieu thereof,
the following:


     "Net Worth" means, with respect to any Person and as of any date of its
determination, the excess of (a) the assets of such Person over (b) the
liabilities of such Person, provided that, notwithstanding anything herein to
the contrary, for the purposes of calculating Net Worth, after September 30,
2001 impairments to goodwill calculated in accordance with FASB Statement No.
142, Goodwill and Other Intangibles, shall be disregarded.

     5. Section 1.3(a) of the Credit Agreement is hereby amended by adding the
following at the end thereof:

          In the event that any "Accounting Change" (as defined below) shall
     occur and such change results in a change in the method of calculation of
     financial covenants, standards or terms in this Agreement, then the
     Borrower and the Administrative Agent agree to enter into negotiations in
     order to amend such provisions of this Agreement so as to reflect equitably
     such Accounting Changes with the desired result that the criteria for
     evaluating the Borrower's financial condition shall be the same after such
     Accounting Changes as if such Accounting Changes had not been made. Until
     such time as such an amendment shall have been executed and delivered by
     the Borrower, the Administrative Agent and the Majority Banks, all
     financial covenants, standards and terms in this Agreement shall continue
     to be calculated or construed as if such Accounting Changes had not
     occurred. "Accounting Changes" refers to changes in accounting principles
     required by the promulgation of any rule, regulation, pronouncement or
     opinion by the Financial Accounting Standards Board of the American
     Institute of Certified Public Accountants or, if applicable, the Securities
     and Exchange Commission.

     III. Conditions to Effectiveness. This Amendment shall become effective on
the date the Administrative Agent shall have received counterparts of this
Amendment duly executed by the Borrower, the Administrative Agent and the
Majority Banks.

     IV. General.

                                       2
<PAGE>

     1. Representations and Warranties. The representations and warranties made
by the Borrower in the Credit Documents are true and correct in all material
respects on and as of the date hereof, after giving effect to the effectiveness
of this Amendment, as if made on and as of the date hereof, and no Default or
Event of Default has occurred and is continuing.

     2. Payment of Expenses. The Borrower agrees to pay or reimburse the
Administrative Agent for all of its out-of-pocket costs and reasonable expenses
incurred in connection with this Amendment, any other documents prepared in
connection herewith and the transactions contemplated hereby, including, without
limitation, the reasonable fees and disbursements of counsel to the
Administrative Agent.

     3. No Other Amendments. This Amendment shall not be construed as a waiver
or consent to any further or future action on the part of the Borrower that
would require a waiver or consent of the Administrative Agent and/or the Banks.
Except as expressly amended hereby, the provisions of the Credit Agreement are
and shall remain in full force and effect.

     4. Governing Law; Counterparts. (B) This Amendment and the rights and
obligations of the parties hereto shall be governed by, and construed and
interpreted in accordance with, the laws of the State of New York. (b) This
Amendment may be executed by one or more of the parties to this Amendment on any
number of separate counterparts, and all of said counterparts taken together
shall be deemed to constitute one and the same instrument. This Amendment may be
delivered by facsimile transmission of the relevant signature pages hereof.

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered by their respective proper and duly authorized
officers as of the day and year first above written.

                                       BORROWER:

                                       INTEGRATED ELECTRICAL SERVICES, INC.

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       ADMINISTRATIVE AGENT:

                                       JPMORGAN CHASE BANK, as Administrative
                                          Agent

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       3
<PAGE>

                                       BANKS:

                                       JPMORGAN CHASE BANK

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       CREDIT LYONNAIS, NEW YORK BRANCH,
                                          as Syndication Agent and as a Bank

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       THE BANK OF NOVA SCOTIA,
                                          as Syndication Agent and as a Bank

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       TORONTO DOMINION (TEXAS), INC.,
                                          as Documentation Agent and as a Bank

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       4
<PAGE>

                                       BANK OF SCOTLAND

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       FIRST BANK & TRUST

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       FIRSTAR BANK, N.A.

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       MERRILL LYNCH CAPITAL CORPORATION

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       SOUTHWEST BANK OF TEXAS, N.A.

                                       By:
                                           -------------------------------------
                                           Name:
                                           Title:

                                       5