Doc 001
Alabama Real Estate License Exam
Prep 2026–2027
PEARSON VUE
NAME: DATE:
Alabama real estate exam, AL real estate salesperson license, Pearson VUE real estate test, Alabama real
estate law, broker license exam prep, real estate practice questions and answers, AREC license
requirements, real estate math calculations, qualifying broker responsibilities, Alabama risk management
course, closing disclosure calculations, property ownership types, trust funds handling Alabama, co-brokerage
agreements, temporary license exam solved.
Alabama Real Estate License Exam Prep 2026–2027 | Salesperson & Broker Practice Test Questions
with Verified Answers
After passing state exam, you have ___ days to apply for a Temporary License, either on an Active
or Inactive basis.
90
Temporary Licenses are only valid for ___ year(s), and cannot be renewed.
1
For an Original License, you must pass a ___ hour post-license course.
30
If Temporary License is ACTIVE, the post-license course must be completed within ___ months.
6.
If the post-license course is not completed within ___ year(s), the Temporary License lapses. This
period begins on the FIRST DAY of the month AFTER passing the state exam.
1
For Broker's License, applicant must have ACTIVE Salesperson License for ___ out of ___ years
immediately preceding the application.
2/3
The fee to transfer your Salesperson License to a new Qualifying Broker is $___.
$25
An owner's mortgage includes a clause requiring a prepayment penalty. Three percent of any
Confidential | 2026 Edition Page 1
,Doc 001
outstanding loan principal would be charged by the lender if the owner paid off the principal before
the scheduled time. Payments were $296.88, due on the first of each month, and included both
principal and interest in arrears at 8% per annum. After the owner's July 1 payment, her loan
balance was $8,946.23. On August 1, after handing her lender the check for her August 1 payment,
the owner paid off the entire remaining loan balance. What is the approximate prepayment penalty?
The monthly house payment, $296.88, includes both interest and principal. The prepayment penalty is
charged only on the principal, not on interest. Therefore, one must determine how much the new principal
loan balance will
be after the August 1st house payment is made. The calculations are as follows:
The loan balance after the July 1 payment is $8,946.23 x 0.08 interest rate = $715.70 a year ÷ 12 months =
$59.64 interest for July.
$296.88 monthly house payment $59.64 interest = 237.24 principal payment on August 1 payment.
$8946.23 loan balance $237.24 principal paid in August leaves new principal balance of $8708.99 after
August 1st payment.
This is the amount on which the prepayment penalty will be based:
$8708.99 x 0.03 penalty = $261.27
A managing broker requires his licensees to mention a particular lender to buyers. The broker has a
financial interest in this particular mortgage lender. Which of the following should the licensee
recommend to buyers?
Consider this lender, disclosing the broker's interest, and other lenders.
Licensees should generally avoid recommending only one lender, and if a financial interest is involved, it
should be disclosed. Since rates can change, a licensee most likely would not know which lender has the
best rates. Licensees may provide a list of lenders without having to display the lenders in any particular
order.
When using the sales comparison approach, a licensee determines that a comparable property's tile
floor in the entry hall is worth $2,000. The subject property does not have tile floors at all. Which of
the following adjustments should be made?
The comparable should be adjusted downward.
In the sales comparison (market data) approach to appraisal, it is always the comparables that are
adjusted, never the subject property. If the comparable is better than the subject property, the adjustment to
it is downward. If the comparable is not as good as the subject property, the adjustment to it would be
upward.
On February 1, a licensee with ABC Realty takes a 3month exclusive right-to-sell listing on a house.
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On March 1, the licensee moves out of state and inactivates his license. What happens to this
listing?
It remains a valid exclusive right-to-sell listing contract with ABC Realty.
The listing belongs to the brokerage firm; it does not belong to an individual licensee. The licensee takes
the listing on behalf of the firm, and, if the licensee leaves or becomes unlicensed during the listing, the
listing would remain in whatever form it was originally taken. The listing would still be in effect with the firm
until it expires or is terminated.
A person bought property from a seller and received a general warranty deed. Two years later, the
seller's brother came forth and claimed he had an ownership interest in the property. The brother
stated he knew the court would uphold his interest. In a general warranty deed, the buyer is
protected from this situation by the covenant--
--of seisin.
Although all covenants in a general warranty deed work together to protect the buyer, the covenant of seisin
specifically guarantees that the owner owned the real estate at the time of the sale and had the right to
convey it.
A listing licensee has what obligations to a buyer?
A licensee's duties to a buyer or customer are fairness, honesty, and accuracy.
A builder is obtaining a construction loan of $95,000 for a single-family residence. Under the Truth-
in-Lending Act, disclosure of a prepayment penalty by the lender is--
--not required for a business loan.
The Truth-in-Lending Act is applicable to individual home owners, but it does not apply to a construction
loan for a builder because the loan is for a business purpose.
To qualify as a tax-deferred exchange, a property must be--
--held for productive use in trade or business.
To defer the gain on the sale of an income-producing property, a tax-deferred exchange may be used.
An office building is valued at $800,000 when the annual net income is capitalized at a rate of 20%. If
the operating expenses and vacancy and rent loss total 40% of the gross income, what is the
approximate gross annual income?
$266,667
The income approach to value is calculated as follows:
Annual net income divided by capitalization rate equals value.
Therefore, net income ÷ 0.2 $800,000.
Confidential | 2026 Edition Page 3
Alabama Real Estate License Exam
Prep 2026–2027
PEARSON VUE
NAME: DATE:
Alabama real estate exam, AL real estate salesperson license, Pearson VUE real estate test, Alabama real
estate law, broker license exam prep, real estate practice questions and answers, AREC license
requirements, real estate math calculations, qualifying broker responsibilities, Alabama risk management
course, closing disclosure calculations, property ownership types, trust funds handling Alabama, co-brokerage
agreements, temporary license exam solved.
Alabama Real Estate License Exam Prep 2026–2027 | Salesperson & Broker Practice Test Questions
with Verified Answers
After passing state exam, you have ___ days to apply for a Temporary License, either on an Active
or Inactive basis.
90
Temporary Licenses are only valid for ___ year(s), and cannot be renewed.
1
For an Original License, you must pass a ___ hour post-license course.
30
If Temporary License is ACTIVE, the post-license course must be completed within ___ months.
6.
If the post-license course is not completed within ___ year(s), the Temporary License lapses. This
period begins on the FIRST DAY of the month AFTER passing the state exam.
1
For Broker's License, applicant must have ACTIVE Salesperson License for ___ out of ___ years
immediately preceding the application.
2/3
The fee to transfer your Salesperson License to a new Qualifying Broker is $___.
$25
An owner's mortgage includes a clause requiring a prepayment penalty. Three percent of any
Confidential | 2026 Edition Page 1
,Doc 001
outstanding loan principal would be charged by the lender if the owner paid off the principal before
the scheduled time. Payments were $296.88, due on the first of each month, and included both
principal and interest in arrears at 8% per annum. After the owner's July 1 payment, her loan
balance was $8,946.23. On August 1, after handing her lender the check for her August 1 payment,
the owner paid off the entire remaining loan balance. What is the approximate prepayment penalty?
The monthly house payment, $296.88, includes both interest and principal. The prepayment penalty is
charged only on the principal, not on interest. Therefore, one must determine how much the new principal
loan balance will
be after the August 1st house payment is made. The calculations are as follows:
The loan balance after the July 1 payment is $8,946.23 x 0.08 interest rate = $715.70 a year ÷ 12 months =
$59.64 interest for July.
$296.88 monthly house payment $59.64 interest = 237.24 principal payment on August 1 payment.
$8946.23 loan balance $237.24 principal paid in August leaves new principal balance of $8708.99 after
August 1st payment.
This is the amount on which the prepayment penalty will be based:
$8708.99 x 0.03 penalty = $261.27
A managing broker requires his licensees to mention a particular lender to buyers. The broker has a
financial interest in this particular mortgage lender. Which of the following should the licensee
recommend to buyers?
Consider this lender, disclosing the broker's interest, and other lenders.
Licensees should generally avoid recommending only one lender, and if a financial interest is involved, it
should be disclosed. Since rates can change, a licensee most likely would not know which lender has the
best rates. Licensees may provide a list of lenders without having to display the lenders in any particular
order.
When using the sales comparison approach, a licensee determines that a comparable property's tile
floor in the entry hall is worth $2,000. The subject property does not have tile floors at all. Which of
the following adjustments should be made?
The comparable should be adjusted downward.
In the sales comparison (market data) approach to appraisal, it is always the comparables that are
adjusted, never the subject property. If the comparable is better than the subject property, the adjustment to
it is downward. If the comparable is not as good as the subject property, the adjustment to it would be
upward.
On February 1, a licensee with ABC Realty takes a 3month exclusive right-to-sell listing on a house.
Confidential | 2026 Edition Page 2
, Doc 001
On March 1, the licensee moves out of state and inactivates his license. What happens to this
listing?
It remains a valid exclusive right-to-sell listing contract with ABC Realty.
The listing belongs to the brokerage firm; it does not belong to an individual licensee. The licensee takes
the listing on behalf of the firm, and, if the licensee leaves or becomes unlicensed during the listing, the
listing would remain in whatever form it was originally taken. The listing would still be in effect with the firm
until it expires or is terminated.
A person bought property from a seller and received a general warranty deed. Two years later, the
seller's brother came forth and claimed he had an ownership interest in the property. The brother
stated he knew the court would uphold his interest. In a general warranty deed, the buyer is
protected from this situation by the covenant--
--of seisin.
Although all covenants in a general warranty deed work together to protect the buyer, the covenant of seisin
specifically guarantees that the owner owned the real estate at the time of the sale and had the right to
convey it.
A listing licensee has what obligations to a buyer?
A licensee's duties to a buyer or customer are fairness, honesty, and accuracy.
A builder is obtaining a construction loan of $95,000 for a single-family residence. Under the Truth-
in-Lending Act, disclosure of a prepayment penalty by the lender is--
--not required for a business loan.
The Truth-in-Lending Act is applicable to individual home owners, but it does not apply to a construction
loan for a builder because the loan is for a business purpose.
To qualify as a tax-deferred exchange, a property must be--
--held for productive use in trade or business.
To defer the gain on the sale of an income-producing property, a tax-deferred exchange may be used.
An office building is valued at $800,000 when the annual net income is capitalized at a rate of 20%. If
the operating expenses and vacancy and rent loss total 40% of the gross income, what is the
approximate gross annual income?
$266,667
The income approach to value is calculated as follows:
Annual net income divided by capitalization rate equals value.
Therefore, net income ÷ 0.2 $800,000.
Confidential | 2026 Edition Page 3
