Alabama Real Estate Salesperson Exam — All Questions
13 questions
In Alabama, who is responsible for maintaining the trust or escrow account that holds earnest money and other client funds?
- a.The individual salesperson
- b.The buyer's attorney
- c.The qualifying broker✓
- d.The Alabama Real Estate Commission
In Alabama the qualifying broker is responsible for the brokerage's trust or escrow account. Client funds such as earnest money must be deposited into that account and kept separate from the broker's own funds. Commingling client funds with personal or business funds is a violation of Alabama license law.
The Alabama Real Estate Recovery Fund is used to:
- a.Pay commissions that brokers fail to split with salespersons
- b.Reimburse members of the public who suffer monetary loss from certain licensee violations and obtain an unpaid court judgment, up to statutory limits✓
- c.Fund the Commission's day-to-day operations
- d.Provide continuing education to licensees at no cost
The Alabama Real Estate Recovery Fund reimburses members of the public who obtain a valid, unpaid court judgment against a licensee for certain violations, subject to statutory per-transaction and per-licensee caps. A licensee who causes a payout may have their license suspended until the fund is repaid.
An Alabama salesperson receives an earnest money check from a buyer. What must the salesperson do with it?
- a.Pay it over to the qualifying broker immediately upon receipt✓
- b.Deposit it in the salesperson's own trust account within 3 days
- c.Hold it until the seller accepts or rejects the written offer
- d.Deliver it to the closing attorney named in the sales contract
Each salesperson or associate broker must pay over to the qualifying broker all funds coming into his or her possession in trust for other parties immediately upon receipt. Deposit is then the qualifying broker's responsibility. Cite: Ala. Admin. Code r. 790-X-3-.03(2) and (3).
An Alabama contract form says nothing about when the earnest money check is to be deposited. When must the qualifying broker deposit it?
- a.Within three business days of receiving the check
- b.Immediately, on the day the check changes hands
- c.Within seven business days of receiving the check
- d.When the offer becomes a contract✓
If the contract form specifies a time or event, the check is deposited then; if it is silent, the check is deposited when the offer becomes a contract. U.S. currency, by contrast, must be deposited immediately. Cite: Ala. Admin. Code r. 790-X-3-.03(3).
An Alabama sale closes. How quickly must the qualifying broker disburse the trust funds held for that transaction?
- a.Within 30 calendar days of consummation
- b.Within 7 business days of consummation✓
- c.Within 3 business days of consummation
- d.Within 10 calendar days of consummation
Unless the rule states otherwise, each qualifying broker must promptly disburse trust funds to the appropriate parties within 7 business days of the consummation of the transaction for which they were deposited. Cite: Ala. Admin. Code r. 790-X-3-.03(5).
An Alabama sale falls through and buyer and seller both demand the earnest money. What may the qualifying broker do?
- a.Release the funds to whichever party the sales contract favors
- b.Return the funds to the buyer after 30 days of deadlock
- c.Disburse only under a signed written agreement or court order✓
- d.Retain the funds as compensation for the work performed
Where there is a disagreement about disbursement, the qualifying broker may not disburse except under a written agreement signed by all parties or under a court order. The rule separately permits depositing the disputed funds with the court by interpleader. Cite: Ala. Admin. Code r. 790-X-3-.03(5) and (7).
An Alabama COMMERCIAL tenancy ends and the qualifying broker holds the security deposit. Within what period must any itemized notice of amounts withheld and the balance due be delivered?
- a.60 calendar days after termination and delivery of possession✓
- b.14 calendar days after termination and delivery of possession
- c.35 calendar days after termination and delivery of possession
- d.90 calendar days after termination and delivery of possession
For commercial leases the Commission rule sets 60 calendar days for the itemized written notice and the amount due. Deposits and checks left unclaimed by the tenant are forfeited after 90 calendar days. Residential security deposits instead follow Ala. Code 35-9A-201 and 35-9A-205. Cite: Ala. Admin. Code r. 790-X-3-.03(6)(b).
In an Alabama single-family residential sale, when must a licensee furnish a complete estimated closing statement?
- a.Once, at the time the seller signs the listing agreement
- b.Only at closing, with the settlement statement
- c.Only when the client asks the licensee for one in writing
- d.Each time a written offer or counteroffer is presented✓
The licensee must furnish a complete estimated closing statement each time he or she prepares or presents a written offer or counteroffer, showing best estimates of all costs and their approximate amounts. The recipient acknowledges it by dated signature on the form. Cite: Ala. Admin. Code r. 790-X-3-.04(1).
What does the Alabama Real Estate Commission's rule say about automatic extension clauses in listing contracts?
- a.They are allowed if the seller initials the clause
- b.Listing contracts shall contain no such provision✓
- c.They are allowed for terms of 90 days or shorter
- d.They are allowed only in commercial listings
The rule is a flat prohibition: listing contracts shall contain no provision for automatic extensions. Cite: Ala. Admin. Code r. 790-X-3-.05.
Under the Alabama rule on advertising teams, what must a team's name do?
- a.Include the surname of the team's designated leader
- b.Include the word 'company' so consumers can find it
- c.Include the word 'team' or 'group'✓
- d.Include the license number of the qualifying broker
The team's name must include the word 'team' or 'group' and must avoid terms suggesting it is a real estate company, including 'corporation', 'limited liability company', 'partnership', 'business', 'enterprise', and 'company'. Cite: Ala. Admin. Code r. 790-X-3-.16, effective February 14, 2026.
Which statement about real estate teams is correct under Alabama law?
- a.No licensee may be a member of more than one team✓
- b.A team must be licensed separately as a business organization
- c.The team leader assumes the qualifying broker's supervisory duties
- d.A team may advertise without naming any of its members
Alabama added a teams statute effective October 1, 2025. A team needs no separate licensure, no licensee may belong to more than one team, the leader must be designated with the qualifying broker and keep a member list, and the qualifying broker's duties cannot be delegated to the leader. Cite: Ala. Code 34-27-39, added by Act 2025-380 (HB382).
How many transactions may one out-of-state principal broker do in Alabama under co-brokerage agreements in a calendar year?
- a.One transaction per calendar year
- b.Ten transactions per calendar year
- c.There is no numerical limit in the statute
- d.Three transactions per calendar year✓
Co-brokerage is capped at three transactions per calendar year per licensed out-of-state principal broker, and those transactions may not total more than $50,000,000 in any calendar year. A transaction may cover multiple properties if they are part of the same portfolio. Cite: Ala. Code 34-27-3(a)(3) and (a)(4), as amended by Act 2025-380, effective October 1, 2025.
The Commission inspects an Alabama brokerage office. How far back must the escrow or trust account bank statements and canceled checks go?
- a.The past three months of statements
- b.The past six months of statements✓
- c.The past twelve months of statements
- d.The past twenty-four months of statements
The records a qualifying broker must make available on an office inspection include copies of the past six months of bank statements with canceled checks for all escrow or trust accounts, along with reconciliations, check registers, and deposit tickets. Cite: Ala. Admin. Code r. 790-X-3-.09(2)(f).