The Alabama Real Estate Commission (“AREC”) held is monthly meeting on March 20, 2025 in Montgomery. During the meeting, AREC announced plans to update its Risk Management course, with a goal to launch these updates in October 2026. AREC has continued to see growth in license applications, with a growth rate of 7.7% in February. Read on to learn insights from the cases presented at the meeting. 

One case involved a licensee who had previously been found in violation of license law. At that time, he was assessed a fine as a punishment for his violation and was allowed to retain his real estate license. The Commission sent him a request to pay the fine, but he didn’t pay it. During his hearing, the licensee expressed that financial difficulties were the reason he hadn’t paid the fine. Unfortunately, this explanation came too late, and the licensee was found guilty of a second license law violation, this time for failing to pay the fine assessed against him. If you find yourself in a similar position, the worst thing you can do is nothing. Try to come up with a plan and contact the Commission to see if you can come to an agreement about your payment – but don’t just ignore their request to pay.   

Another matter involved a licensee who was working with his mother as a prospective buyer. The listing agent filed a complaint, alleging that the licensee who was working with his mother failed to disclose in writing his connection to the consumer. In response, the licensee stated that he had disclosed the relationship verbally but admitted that he had not done so in writing. The transaction in question never closed. The licensee was found in violation of license law for his failure to make a written disclosure. However, the Commission did consider the fact that the transaction didn’t close and assessed the licensee a $500 fine. Remember, Alabama Code § 34-27-84 requires that before you may work on your own behalf, on behalf of your immediate family, or on behalf of “any other individual, organization, or business entity in which [you] have a personal interest,” you must disclose this interest to all other parties in writing. AAR offers form 2.10, Personal Interest Disclosure, for this purpose. 

One licensee was charged with dishonest dealings because of false information given to the consumer. The case involved a property with tenants living onsite that was being sold, and the leases transferred to the new owner. The licensee was the property manager, and through his property management agreement was required to verify all tenants’ income. The buyer inquired with the licensee about whether he had in fact verified the tenants’ income and the licensee told the buyer that he had. However, as it turns out, the licensee did not verify the income of at least one tenant. You may be wondering why this matter was brought before the Commission, as verifying tenants’ income is not a required duty under license law. Here, the issue was not that the licensee had failed to complete a duty required by Alabama license law, but rather that the licensee lied to the consumer about having done it. Licensees do not have a duty to provide services that are not required under the law, but they do have a duty to tell consumers the truth. This case is a good reminder that honesty is always the best policy!