SB212 Alabama 2025 Session

Summary

Primary Sponsor

Josh CarnleySenator

Republican

Session

2025 Regular Session

Title

Real estate transactions; required disclosure forms; description of brokerage services; terms of compensation; required written brokerage agreements under certain circumstances; penalties and fines for certain violations; duties of qualifying brokers and licensees; scope of operation of teams

Summary

SB212 updates Alabama real estate law to standardize disclosures, agency rules, team operations, and cross-state broker practices, with new penalties and licensing requirements.

What This Bill Does

Licensees would have to give consumers a RECAD disclosure before showing a property and in writing describe the specific brokerage services their company provides, along with general compensation information. After disclosure, consumers can choose to enter into a brokerage agreement, but such an agreement is not required just to view a property; a written agreement would be needed if the licensee lists the property or submits an offer for the consumer. The bill also tightens rules around team use, co-brokerage with out-of-state brokers, and enforcement, including penalties for violations and a new framework for licensing and reciprocal licensing. It takes effect October 1, 2025.

Who It Affects

• Real estate licensees, brokerages, and teams in Alabama, who must adopt new disclosure forms, clarify agency relationships, follow team rules, and face new penalties and reporting requirements.
• Consumers (buyers and sellers) involved in real estate transactions, who will receive standard disclosures, clearer information about who represents them, and defined options for brokerage services.

Key Provisions

• Requires consumer to receive a Real Estate Consumers Agency and Disclosure Act (RECAD) disclosure before showing a property and to be given written information about the specific brokerage services offered by the licensee's company and general compensation terms.
• A written brokerage agreement is required only when the licensee will list the property for sale or submit an offer on behalf of the consumer; otherwise, a brokerage relationship can exist without a written agreement.
• Defines and regulates team structures: teams must have a designated leader (the qualifying broker’s designation), maintain a roster, and advertise with rules; teams do not need separate licensure as a business and cannot have multiple team leaders.
• Introduces co-brokerage provisions with licensed out-of-state principals: up to three co-brokerage transactions per out-of-state principal broker per calendar year, with Alabama brokers supervising in-state activities and specific contract provisions for these arrangements.
• Establishes agency disclosure office policies and forms to be used uniformly by all Alabama brokerages, plus annual training and signed receipt records.
• Imposes penalties for violations, including fines, license suspension or revocation, cease-and-desist orders, restitution, and costs; penalties include procedures for payment failures that can deactivate or lapse licenses.
• Adds extensive licensing and reciprocal licensing requirements for out-of-state licensees, including background checks, minimum education hours (60 hours Alabama-approved for salespersons, 60 hours for other steps), and a special written Alabama-focused exam; allows reciprocal licenses with proof of current license and active status in another state; requires notice of address changes and annual renewals.

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

Subjects

Property & Estates