Trust Funds

An Alabama broker's trust account is subject to AREC examination:

AOnly when the broker applies for license renewal

BAt any time at AREC's discretion✓ Correct

COnly after a formal complaint is filed

DEvery 5 years on a scheduled basis

Explanation

AREC has broad authority to examine broker trust accounts at any time, with or without prior notice or a pending complaint.

A neutral third-party arrangement where funds, documents, and instructions are held until all conditions of a real estate transaction are satisfied.

Fees and expenses paid by the buyer and/or seller at the closing of a real estate transaction, in addition to the property's purchase price.

The division of ongoing property expenses (taxes, HOA dues, rents) between buyer and seller at closing based on their respective days of ownership.

A tax imposed by state or local governments when real property ownership is transferred, typically based on the sale price.

Trust Account RulesAREC RegulationLicense Law

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