House Bill 357 Alabama 2026 Session

Summary

Primary Sponsor

Rolanda HollisRepresentative

Democrat

Session

2026 Regular Session

Title

Alabama Real Estate Commission; equitable interest transfers, disclosure and licensing requirements, penalties for violations

Summary

HB357 would require licensing for equitable-interest transfers of real estate, require disclosures and a fixed closing date in those deals, and give the Alabama Real Estate Commission new enforcement tools.

What This Bill Does

HB357 clarifies that holding an equitable interest in real estate does not exempt a person from real estate licensing requirements when the interest is transferred for a fee. It would require the equitable-interest owner to be licensed and to disclose to buyers that they are not the deed holder. Licensees would have to include a fixed closing date in equitable-interest contracts and disclose specific terms; the bill authorizes disciplinary action and penalties for failures. The Alabama Real Estate Commission could impose fines, education requirements, public reprimands, suspensions or revocations, and cease-and-desist orders, and the bill updates current law language and sets an effective date of October 1, 2026.

Who It Affects

• Equitable-interest holders who transfer or offer to transfer their interest for a fee would be subject to licensing requirements and disclosures; they would need to be licensed and disclose to buyers that they are not the deed holder.
• Licensed real estate professionals (brokers, associate brokers, salespersons, and real estate companies) who handle equitable-interest transactions would face new disclosure obligations and penalties for failures to disclose or to include a fixed closing date.

Key Provisions

• Equitable-interest transfers for a fee must involve licensing of the holder (broker or salesperson) under the Alabama Real Estate Commission.
• Disclosures required in equitable-interest transactions, including notifying buyers that the equitable-interest holder is not the deed holder;
• Contracts involving equitable interests must include a fixed closing date (no automatic extensions).
• The Commission may discipline licensees for failing to disclose required information or failing to include a closing date, including fines ($100-$5,000), required education, public reprimands, and license suspensions or revocations, plus order costs and potential cease-and-desist actions;
• Additional enforcement measures include cease-and-desist orders for unlicensed activity, and penalties for nonpayment of fines or for license inactivity through payment failures; effective date is October 1, 2026; and the bill includes nonsubstantive technical language updates.

AI-generated summary using openai/gpt-5-nano on Feb 12, 2026. May contain errors — refer to the official bill text for accuracy.

Subjects

Authorities, Boards, & Commissions