Alabama Real Estate Exam Questions: A Sneak Peek

Preparing for your Alabama Real Estate Exam might feel like a big and insurmountable task. After all, there are numerous topics to study and many possible questions to explore. But you can do it. You only need to be methodical and constant in your studies, and you´ll see how you can pass it without problems. 

In this article, we´ll provide an overview of the types of questions to expect on the Alabama Real Estate Exam, along with real examples from our preparation courses! We have also included essential tips to help you study and prepare more effectively for the exam.

Keep reading and get a step closer to your real estate license!

Alabama Real Estate Exam Overview

Let´s start with the basics. How many questions are on the Alabama Real Estate Exam? How much time will you have to answer? 

• The Alabama Real Estate Exam has two portions:
  • National Portion, with 80 questions in 150 minutes (2 ½ h).
  • State Portion, with 40 questions in 60 minutes (1h).
  • For a total of 120 questions in 210 minutes (3 ½ h)

• All of the questions are computer-based, and only multiple-choice 
• You have to get a punctuation of 70 in both portions

Make sure to check your state’s licensing requirements so you know exactly what steps you need to take to qualify for the exam.

Topics that are tested

Now, let’s review all the topics that you need to study for the Alabama Real Estate Exam. As we mentioned, there are two portions: one with questions applicable to the entire country, and the second with laws and regulations specific to the state of Alabama.

• National Portion
  • Real Property Characteristics, Legal Descriptions, and Property Use
  • Forms of Ownership, Transfer & Recording Title
  • Property Value & Appraisal
  • Contracts & Agency
  • Real Estate Practice
  • Property Disclosures and Environmental Issues
  • Financing & Settlement
  • Mathematical Calculations 

• State Portion
  • Purpose of License Law & Commission Authority
  • Licensing Requirements 
  • License Status
  • Broker/Company Licenses & Place of Business
  • Recovery Fund 
  • Disciplinary Actions & Process 
  • Estimated Closing Statement 
  • Trust Funds 
  • RECAD (Real Estate Commission-approved disclosures) 
  • Violations Leading to Discipline

Alabama Real Estate Exam Questions, Real Examples

Now to the juicy part of the blog! The real examples of questions that you can find on the exam! Read them carefully, and you’ll notice how most of the time they require you to apply a key concept to a situation. 

Knowing the definitions is not enough! Here are some questions so you can measure your starting point:

Question 1: 

If a broker enters into a verbal agreement with a seller without obtaining written confirmation subsequently, what is the status of the commission payment owed to that broker?

• A: It is prohibited according to the commissioner’s regulations and rules.
• B: It is illegal.
• C: It is contrary to public policy.
• D: It is permissible if the seller elects to do so.

The correct answer is: D. It is permissible if the seller elects to do so.

Explanation:

If a broker takes an oral listing without obtaining subsequent written verification, a commission payment is only permissible if the seller agrees to pay such a commission. However, if the commission payment is not confirmed in writing, it is unenforceable in a court of law due to the Statute of Frauds. This law requires that all contracts related to the sale of real estate be in writing and legally enforceable.

Question 2: 

If a person uses their property as collateral for a debt but retains possession of it, they have:

• A: transferred the property to the creditor.
• B: lost all ownership rights to the property.
• C: Waived the right to receive any proceeds from the property in the future.
• D: Hypothecated the property.

The correct answer is: D. Hypothecated the property.

Explanation:

Hypothecation refers to the act of pledging an asset as security for a debt, without giving up possession of the asset. This means that the borrower retains ownership and control of the asset, but the lender has the right to take possession of the asset if the borrower defaults on the loan.

Question 3: 

What is the definition of “deed” in a real estate transaction?

• A: A legal document that transfers ownership of a property from the seller to the buyer.
• B: a contract between the buyer and lender outlining the terms of the loan.
• C: a contract between the buyer and seller outlining the terms of the sale.
• D: A legal arrangement where a neutral third party holds the title to the property until the borrower fulfills their mortgage obligations.

The correct answer is: A. A legal document that transfers ownership of a property from the seller to the buyer.

Explanation:

A deed is a legal document that facilitates the transfer of property ownership from the seller to the buyer. It serves as proof of ownership and outlines the rights and responsibilities associated with the property.

Question 4: 

John completed a 60-hour course from a provider that was not approved by the commission. Can John still apply for a salesperson license in Alabama?

• A: Yes, John can still apply for a salesperson license in Alabama since he completed the required 60-hour course.
• B: No, John cannot apply for a salesperson license in Alabama since he did not complete a 60-hour course from an approved provider.
• C: Yes, John can still apply for a salesperson license in Alabama as long as he passes the state exam.
• D: No, John cannot apply for a salesperson license in Alabama, but he can apply for a broker license instead.

The correct answer is: B. No, John cannot apply for a salesperson license in Alabama since he did not complete a 60-hour course from an approved provider.

Explanation:

The Alabama Real Estate Commission requires applicants for a salesperson license to complete a 60-hour pre-license course from an approved provider. If John completed a course from a provider that was not approved by the commission, he would not meet the licensing requirements and would not be eligible to apply for a salesperson license in Alabama.

Question 5: 

Which of the following actions is considered a violation of Alabama real estate law?

• A: Presenting misleading advertising materials.
• B: Failing to disclose known material defects in a property.
• C: All of the options are correct.
• D: Providing false information about the property condition to potential buyers.

The correct answer is: C. All of the options are correct.

Explanation:

Providing false information about property condition, presenting misleading advertising materials, and failing to disclose known material defects are all violations of Alabama real estate law. Real estate professionals are obligated to act with honesty and integrity and must provide accurate and truthful information to buyers and clients.

Want more questions to study? Try Lexawise’s full exam prep course! With over 4,500 Real Estate questions, unlimited practice and simulated exams, and so much more!

Tips to Study Effectively

Now that you have had the chance to see how challenging the questions can be, here are some tips to help you study for the test. 

• Split the national and the state portions.
  •  While the national portion covers a broader range of topics and includes more questions, you must also achieve a 70% on the state portions. So focus equally on both, and use a color-coded system or separate notebooks. 
• Keep the question format in mind.
  •  The exam is multiple-choice, so try to think in that format and ask questions with qualifiers and exceptions in mind. 
• Track your mistakes
  •  With a mistake log, you can easily identify which topics you need to revisit. Check it weekly to see your progress!

Make sure to check Alabama’s licensing requirements so you know exactly what steps you need to take to qualify for the exam.

Common Mistakes that Candidates Make in the Alabama Real Estate Exam Questions

Surprisingly, many candidates do not fail the Alabama Real Estate Exam because they lack knowledge or preparation. Plenty of them just get nervous and misread or misunderstand the questions. Since you probably don’t want that, here are some common mistakes to be aware of. 

• Not spotting keywords
  •  Read carefully the question and look for the “except”, “not”, and “always”. They can change the sense of a question. 
• Misunderstand similar terms
  •  Void and voidable are not the same, just like tenancy in common and joint tenancy. 
• Choosing the most complete answer
  •  Even if two or three answers are technically correct, choose one that’s broadest, most accurate, and conveys the situation best.

A helpful tip is to eliminate the answer you know is wrong first, which can help you concentrate and increase your chances of guessing the correct answer.

Can I retake the Alabama Real Estate Exam?

Many candidates have this doubt, and the answer is quite simple. Yes, you can retake the exam as many times as you need, as long as your 6-month test authorization is still active. If it expires, you will need to retake the 60-hour course and obtain a new testing authorization. 

If you fail, you’ll receive a diagnostic score report showing your performance in the test. It is essential to focus your studies after a failure, as it shows your weak spots. 

In Conclusion

The test is not about loose concepts and facts, but everyday situations that you can encounter during your career. And yes, the Alabama Real Estate Exam Questions might seem hard at first glance, but now you have a lot more preparation and better strategies. 

If you still don’t know how to pace your studies or need more resources, try Lexawise’s Real Estate Exam prep! You can track your progress, access all of our tools, and get Alabama-specific practice questions and explanations. 

Start your preparation with Lexawise today and get ready to answer every question with confidence!