Company & Branch Licensure in Alabama Real Estate

Instructor: Tara Schofield

Tara has a PhD in Marketing & Management

Opening your own real estate company and branch offices is a great way to grow your business. Learn how to set up licenses for your company and branch office, including managing renewals.

Real Estate Licenses for Companies

You just entered the exciting world of real estate sales. One of the first things you did after passing your exam was find a brokerage to work for. In Alabama, it is required that you work with a broker while you get experience. In fact, you must have 24 months of experience within the past 36 months before you can apply to work on your own or become a managing broker. During this time you will work for a broker who operates a company.

Your broker, Tom, established a company and has an active license for his company. The Alabama Real Estate Commission oversees all licenses, including the license Tom applied for when he started his own brokerage. In order to receive his company license, he had to register his business with the state of Alabama. He had to determine the structure of his business, such as whether it would be an S-Corp, sole proprietorship, or partnership.

When Tom applied for his real estate license from the commission, he had to provide the business location for his brokerage, along with a business telephone and space to hold records and files at the office. As with an individual real estate license, Tom had to pay the $65 licensing fee for his company.

Tom has recently decided to open another office on the other side of town. This location is considered a branch office, the second office of the same company he already owns.

Because Tom completed the requirements to receive his brokerage license, he can act as the qualifying broker, the broker who oversees and is responsible for all transactions that happen within his brokerage.

Tom can open a satellite office by registering the office with the real estate commission. While Tom can be the owner of both offices, he will need to appoint a qualifying broker to manage the new office. Just like his original office, he will need a physical location where agents can work, business calls can be received, and records can be kept.

Renewing Corporate Licenses

Just as with individual agent licenses, Tom must renew his company license every two years. He must pay the $65 annual renewal fee for his current location. When he opens his new branch office, he will need to apply and pay the fee for the license for that location. The new office will be on a two-year rotation as well. Tom needs to ensure the renewal is handled before September 1st of the year the company license expires to avoid paying a penalty or risking having the company license be inactive.

Should he overlook renewing the company license by the end of September of the expiring year, no transactions can be closed, no further work completed, and all agents must move to a new agency. For this reason, it's important that Tom keep the company license active at all times.

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