HB492 Alabama 2024 Session

Summary

Primary Sponsor

Rolanda HollisRepresentative

Democrat

Session

Regular Session 2024

Title

Real estate professionals, licensing requirements, limitations and penalties related to duration of residential listing agreements, requirements and penalties related to disclosure of equitable interests in contracts, limits transactions with licensed out of state professionals.

Summary

HB492 would overhaul Alabama's real estate licensing and practice rules by tightening training and licensure, limiting out-of-state co-brokerage, expanding agency disclosures, and strengthening penalties for violations.

What This Bill Does

It establishes stricter training, licensure, and renewal requirements for licensees and schools, including bonds for prelicense schools and new fee structures. It limits co-brokerage with licensed out-of-state brokers to three transactions per calendar year and a $50 million annual cap, with supervision, disclosure, and escrow requirements. It expands agency disclosure rules and defines multiple brokerage relationships (single agent, designated single agent, dual agency, and transaction broker facilitator) to improve transparency for buyers and sellers, while allowing enforceable penalties for violations. It also enhances enforcement powers of the Alabama Real Estate Commission and broadens the set of prohibited practices and related penalties.

Who It Affects

• Alabama real estate licensees and license offices (brokers, salespersons, and companies), along with real estate schools, who would face new training/licensing requirements, bond provisions, fee changes, and updated renewal/CE rules.
• Consumers in Alabama (buyers and sellers) and out-of-state brokers involved in Alabama transactions, who would gain clearer agency disclosures, defined brokerage relationships, and stricter oversight of co-brokerage and equitable-interest disclosures.

Key Provisions

• Co-brokerage limits with out-of-state brokers: out-of-state principal brokers may cooperate only up to three co-brokerage transactions per calendar year with Alabama licensees, with a $50,000,000 annual cap on such transactions; Alabama brokers must supervise, show Alabama broker name in all Alabama property advertising, and hold earnest money in escrow unless both parties agree otherwise.
• Disclosures of equitable interests and listing issues: licensees may be penalized for failing to disclose equitable interests in residential contracts or for failing to specify listing expiration dates or for creating encumbrances on listing properties; penalties may include fines, suspension, or revocation.
• Expanded agency framework and disclosure forms: introduction of agency relationships such as designated single agent and transaction broker facilitator; mandatory agency disclosure forms and office policies; required disclosure to buyers/sellers of brokerage services and roles; duties and liability provisions.
• Training, licensure, and school regulation: new definitions and requirements for training, qualifications, licensure, and renewal for licensees and schools; bonds for prelicense principal schools; branch office licensing; background checks; and added licensing fees.
• Renewals, continuing education, and funds: mandatory continuing education (typically 15 clock hours per two-year renewal, with courses of at least 60 minutes and a limit on the number of 60-minute courses); legislature or service hours count toward CE; renewal deadlines with penalties for late filings; and Recovery Fund/education fees.
• Reciprocal and temporary licensing: allows reciprocal licensure for out-of-state licensees, with requirements to show current license and six hours of Alabama-approved coursework; temporary licenses for salespersons and brokers with post-license requirements (orientation and coursework) and timelines for converting to permanent licensure.
• Enforcement and compliance tools: broader authority for the Alabama Real Estate Commission to investigate, issue cease-and-desist orders, impose fines, and consider revocation/suspension for violations; enhanced recordkeeping and reporting obligations for licensees and firms.

AI-generated summary using openai/gpt-5-nano on Feb 22, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Authorities, Boards, & Commissions