To get an Alabama real estate license, you must be at least 19 years old, hold a high school diploma or equivalent, complete a 60-hour pre-license course from a provider approved by the Alabama Real Estate Commission (AREC), pass the state licensing exam, and clear a fingerprint-based background check. Brokers face additional coursework on top of the salesperson requirements. Once licensed, you have ongoing obligations covering continuing education, trust accounts, advertising, and renewal every two years. The Alabama real estate license requirements described below apply to salespersons, brokers, and business entities that handle real estate transactions for compensation.
Who Needs a License
Alabama Code Section 34-27-30 makes it unlawful for any person or business to perform real estate activities for a fee without a license. Covered activities include selling, purchasing, renting, or leasing property, negotiating listings, locating properties for buyers or tenants, and auctioning real estate.1Alabama Legislature. Alabama Code 34-27-30 – Required Even presenting yourself as able to perform these activities requires a license, whether or not a deal closes.
Business entities are covered too. A company doing real estate work must hold a company license, and each office location needs a designated qualifying broker who is an officer, partner, or employee of the company and supervises the licensed agents working there.2Alabama Legislature. Alabama Code 34-27-32 – License Qualifications
Who Is Exempt
Alabama Code Section 34-27-2 exempts several categories from the licensing requirement:
- Property owners managing, selling, renting, or leasing their own property, or the property of a spouse, child, or parent.
- Licensed attorneys performing their duties as attorneys.
- Receivers, trustees, administrators, executors, and guardians acting under court order or under a trust or will.
- Someone acting without compensation under a valid power of attorney to complete a single transaction.
- On-site managers of apartment buildings or complexes. On-site condominium managers are not exempt.
- Administrative employees of a brokerage, as long as they do not physically show listed properties to prospects.
- Transactions involving cemetery lots.
These exemptions are narrow.3Alabama Legislature. Alabama Code 34-27-2 – Definitions; Exemptions If your situation doesn’t clearly fit, assume a license is required.
Age, Education, and Exam
Age and Basic Eligibility
All applicants must be at least 19, Alabama’s age of majority. A high school diploma or equivalent is also required.
Pre-License Education
Salesperson candidates complete a 60-hour pre-license course from an AREC-approved provider covering Alabama real estate law, contract principles, property ownership, financing, and ethical responsibilities.4Alabama Center for Real Estate. Education – ACRE Broker candidates complete an additional 60-hour broker pre-license course covering brokerage management, business planning, and related topics.
Licensing Examination
Pearson VUE administers the Alabama real estate exam. Both the salesperson and broker versions have 120 scored questions split between a general real estate section (80 questions, 2.5 hours) and an Alabama-specific section (40 questions, 1 hour), with additional unscored pretest items. You need 70 or higher on each section to pass.5Pearson VUE. Alabama Real Estate Candidate Handbook
The exam fee is $73. If you fail, you can schedule a retake and pay the fee again. You must pass within six months of finishing your pre-license coursework or the course expires and you start over. After passing, you have 90 days to submit a completed license application to AREC.5Pearson VUE. Alabama Real Estate Candidate Handbook
Background Check
Every applicant submits to a fingerprint-based criminal background check processed through the Alabama Law Enforcement Agency (ALEA) and the FBI. Felony convictions and crimes involving dishonesty, such as fraud, theft, or forgery, may result in denial. AREC reviews these cases individually, weighing the nature of the offense, how much time has passed, and evidence of rehabilitation. Failing to disclose a criminal history can trigger immediate disqualification or later revocation, even when the underlying offense would not have been disqualifying on its own.
If You’re Already Licensed in Another State
Alabama offers reciprocal licensing. Your current license must be active or inactive (not expired) and in good standing with no unresolved discipline. It must also have been earned by completing pre-license coursework and passing a comprehensive exam in that state. A reciprocal or nonresident license from another state does not qualify as the basis for Alabama reciprocity.6Alabama Administrative Code. Alabama Administrative Code 790-X-1-.18 – Reciprocal License Requirements
Reciprocal applicants complete 6 hours of Alabama-specific pre-license coursework and pass a reciprocal exam covering only Alabama law: 40 questions, one-hour limit, score of 70 to pass, $53 fee. You must pass within six months of completing the reciprocal coursework or retake the course. You’ll also need a certification of licensure from your current state, obtained within 120 days before AREC issues your Alabama license.6Alabama Administrative Code. Alabama Administrative Code 790-X-1-.18 – Reciprocal License Requirements
Continuing Education and Renewal
Alabama requires 15 hours of continuing education every two years. Salespersons and brokers both take a mandatory 3-hour risk management course. Brokers take an additional 3-hour mandatory broker course and choose 9 elective hours; salespersons choose 12 elective hours. Missing the continuing education deadline puts your license on inactive status until you make up the shortfall.
Licenses are currently issued on a two-year cycle, though the Commission has statutory authority to set one-year or multi-year periods. Renewal applications and fees are due on or before August 31 of the final year of each license period. The statutory renewal fee is $85 per year for salespersons and $95 per year for brokers, which comes to $170 and $190 respectively over a two-year period, though actual totals at renewal may be higher once administrative fees are added.7Alabama Legislature. Alabama Code 34-27-35 – License Certificates Generally
Miss the August 31 deadline and late penalties apply. Licenses not renewed by September 30 go inactive, and you cannot practice until renewal is complete. Let your license expire entirely and reinstatement requires a new application and additional fees. If enough time passes, you may need to redo pre-license education and retake the state exam. AREC accepts renewals through its online licensing portal.
Conduct Rules That Get Licensees in Trouble
Dealing Honestly
Alabama Code Section 34-27-36 prohibits a long list of behaviors. The ones most often cited include failing to disclose known property defects a reasonable buyer would consider significant, making misleading promises to induce someone to sign a contract, and acting for both sides of a transaction without written consent from all parties.8Alabama Legislature. Alabama Code 34-27-36 – Disciplinary Action – Generally The disclosure rule excludes trivial issues and applies only to defects significant enough to influence a reasonable person’s decision to buy or lease.
Trust Accounts
Qualifying brokers must deposit all client funds into a separate, federally insured trust account at an Alabama financial institution. The broker must be a customer of that institution with authority to deposit, withdraw, and write checks on the account.9Alabama Administrative Code. Alabama Administrative Code 790-X-3-.03 – Deposit of Funds Commingling client funds with personal or business money is one of the most common violations and one of the fastest ways to lose a license. Trust account records must be kept for at least three years and produced on Commission request.8Alabama Legislature. Alabama Code 34-27-36 – Disciplinary Action – Generally
Advertising
Every advertisement for Alabama real estate must include the name of the qualifying broker. Deceptive or misleading advertising is a disciplinary offense, and the rule reaches online listings, social media, print ads, and signage.8Alabama Legislature. Alabama Code 34-27-36 – Disciplinary Action – Generally You also cannot place a “For Sale” or “For Rent” sign on a property without the owner’s consent.
Penalties
When AREC confirms a violation, the Commission can impose fines of $100 to $5,000 per violation, a public reprimand, mandatory education beyond normal continuing education, or license suspension or revocation. Suspensions can continue until the licensee completes required education, makes restitution to trust accounts, or both. Penalties apply per violation, so multiple infractions compound.8Alabama Legislature. Alabama Code 34-27-36 – Disciplinary Action – Generally
Unlicensed practice carries real consequences too. Under Section 34-27-36(d), AREC can issue a cease and desist order against unlicensed individuals or businesses; if no hearing is requested within 15 days, the order becomes final. Unlicensed practitioners face the same $100 to $5,000 per-violation fine range, plus an additional fine equal to any profit from the unlicensed activity and another covering the Commission’s investigation costs, all enforceable through the courts.8Alabama Legislature. Alabama Code 34-27-36 – Disciplinary Action – Generally