Alabama Real Estate License Exam / Expert
Strategies. EXAM 2025 QUESTIONS AND
ANSWERS
After passing state exam, you have ___ days to apply for a Temporary License, either on an
Active or Inactive basis. - ANS 90
Temporary Licenses are only valid for ___ year(s), and cannot be renewed. - ANS 1
For an Original License, you must pass a ___ hour post-license course. - ANS 30
If Temporary License is ACTIVE, the post-license course must be completed within ___ months.
- ANS 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. - ANS 1
For Broker's License, applicant must have ACTIVE Salesperson License for ___ out of ___ years
immediately preceding the application. - ANS 2/3
The fee to transfer your Salesperson License to a new Qualifying Broker is $___. - ANS $25
An owner's mortgage includes a clause requiring a prepayment penalty. Three percent of any
outstanding loan principal would be charged by the lender if the owner paid off the principal
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before the scheduled time. Payments were $296.88, due on the first of each month, and
@COPYRIGHT BRAINBARTER 2025/2026
, 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? - ANS 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? - ANS 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
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, floors at all. Which of the following adjustments should be made? - ANS 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. On March 1, the licensee moves out of state and inactivates his license. What happens
to this listing? - ANS 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-- - ANS --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? - ANS 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-- - ANS --not
required for a business loan.
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, 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-- - ANS --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? - ANS $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.
The net income is $800,000 × 0.2 = $160,000.
The net income is 60% (100% 40%) of the gross income.
The gross income is $160,000 ÷ 0.6 = $266,667.
AREC has ___ commissioners; each commissioner serves a ___ year term, with no more than
___ consecutive terms. - ANS 9 commissioners; 5 years per term; 2 consecutive term max.
AREC commissioners are appointed by the ___ with the advice and consent of the ___. -
ANS Governor; Senate.
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@COPYRIGHT BRAINBARTER 2025/2026
Strategies. EXAM 2025 QUESTIONS AND
ANSWERS
After passing state exam, you have ___ days to apply for a Temporary License, either on an
Active or Inactive basis. - ANS 90
Temporary Licenses are only valid for ___ year(s), and cannot be renewed. - ANS 1
For an Original License, you must pass a ___ hour post-license course. - ANS 30
If Temporary License is ACTIVE, the post-license course must be completed within ___ months.
- ANS 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. - ANS 1
For Broker's License, applicant must have ACTIVE Salesperson License for ___ out of ___ years
immediately preceding the application. - ANS 2/3
The fee to transfer your Salesperson License to a new Qualifying Broker is $___. - ANS $25
An owner's mortgage includes a clause requiring a prepayment penalty. Three percent of any
outstanding loan principal would be charged by the lender if the owner paid off the principal
1
Page
before the scheduled time. Payments were $296.88, due on the first of each month, and
@COPYRIGHT BRAINBARTER 2025/2026
, 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? - ANS 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? - ANS 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
2
Page
@COPYRIGHT BRAINBARTER 2025/2026
, floors at all. Which of the following adjustments should be made? - ANS 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. On March 1, the licensee moves out of state and inactivates his license. What happens
to this listing? - ANS 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-- - ANS --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? - ANS 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-- - ANS --not
required for a business loan.
3
Page
@COPYRIGHT BRAINBARTER 2025/2026
, 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-- - ANS --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? - ANS $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.
The net income is $800,000 × 0.2 = $160,000.
The net income is 60% (100% 40%) of the gross income.
The gross income is $160,000 ÷ 0.6 = $266,667.
AREC has ___ commissioners; each commissioner serves a ___ year term, with no more than
___ consecutive terms. - ANS 9 commissioners; 5 years per term; 2 consecutive term max.
AREC commissioners are appointed by the ___ with the advice and consent of the ___. -
ANS Governor; Senate.
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Page
@COPYRIGHT BRAINBARTER 2025/2026
