Alabama Real Estate Exam Practice Questions (2025)

Alabama's real estate salesperson exam has 140 questions: 100 national and 40 state-specific. You need 70% (98/140) to pass. Here are practice questions from both sections.

National Section Questions

Q1: A buyer purchases a home for $285,000 with 10% down. What is the loan-to-value ratio? - Loan: $285,000 × 0.90 = $256,500 - LTV: $256,500 ÷ $285,000 = 90%

Q2: Which federal act requires lenders to provide a Loan Estimate within 3 business days of a loan application? A) RESPA B) TRID (TILA-RESPA Integrated Disclosure Rule) C) HMDA D) Dodd-Frank

Answer: B — TRID requires a Loan Estimate within 3 business days of application and a Closing Disclosure at least 3 business days before closing.

Q3: A property generates $84,000 annual NOI. Market cap rate is 7%. What is the indicated value? - Value = NOI ÷ Cap Rate = $84,000 ÷ 0.07 = $1,200,000

Alabama-Specific Section Questions

Q4: The Alabama Real Estate Commission (AREC) has how many members? A) 5 members B) 7 members C) 9 members D) 11 members

Answer: C — AREC has 9 members: 7 real estate licensees and 2 consumer members, appointed by the Governor.

Q5: Alabama real estate license law is found in: A) Alabama Code Title 34, Chapter 27 B) Alabama Code Title 40 C) Alabama Administrative Code Chapter 780 D) Alabama Real Property Act

Answer: A — The Alabama Real Estate Licensees Act is found in Alabama Code Title 34, Chapter 27.

Q6: In Alabama, a salesperson's license is issued as: A) Active immediately upon passing the exam B) Inactive until the salesperson is associated with a broker C) Provisional for the first year D) Active only if the broker co-signs the application

Answer: B — Like most states, an Alabama salesperson's license is inactive until associated with a sponsoring broker.

Q7: Alabama requires real estate salesperson applicants to complete how many hours of prelicense education? A) 30 hours B) 60 hours C) 90 hours D) 60 hours for salesperson, 60 hours for broker (total 120)

Answer: B — Alabama requires 60 hours of prelicense education for salesperson applicants.

Q8: Which Alabama disclosure is required for residential property transactions? A) Alabama Seller's Disclosure Statement (mandatory) B) Alabama Residential Property Disclosure Act notice (required for most residential sales) C) No disclosure required — Alabama is caveat emptor D) Disclosure required only if the seller knows of structural defects

Answer: B — Alabama has a Residential Property Disclosure Act requiring sellers to disclose known material defects. Alabama also has limited caveat emptor traditions in some commercial contexts, but residential disclosure is required.

Q9: In Alabama, how long must broker records be kept? A) 2 years B) 3 years C) 5 years D) 7 years

Answer: C — Alabama brokers must maintain transaction records for 5 years.

Q10: An Alabama salesperson receives earnest money. What is the correct procedure? A) Deposit it in the salesperson's business account B) Hold it personally until the offer is accepted C) Deliver it to the supervising broker immediately or by the next business day D) Forward it directly to the closing attorney

Answer: C — The salesperson must deliver earnest money to the supervising broker immediately or by the next business day.

Key Alabama Topics

• AREC: 9 members (7 licensees + 2 consumers)
• Title 34, Chapter 27: Alabama license law
• 60-hour prelicense: Salesperson requirement
• 5-year record retention: Broker records
• Residential Property Disclosure Act: Required for most residential sales

[Practice Alabama questions at CARealestate.com/states/alabama](https://carealestate.com/states/alabama)