What they would have regulated

The target was “unfair service agreements” — long-term recorded service contracts that, in the bill's words, “[p]urport[] to run with the land or to be binding on future owners” or “[p]urport[] to create a lien, encumbrance, or other real property security interest.”

These are the instruments sometimes called NTRAPS: a homeowner accepts a modest payment now in exchange for a decades-long exclusive listing right recorded against the property. Alongside them, the bills addressed real-estate wholesaling — the practice of contracting to buy a property and assigning the contract at a mark-up — with licensing and disclosure requirements enforceable by the Alabama Real Estate Commission and, in HB 586, the Alabama Securities Commission.

The carve-outs, and their real status

Section 8-42-2 excludes from the definition of an unfair service agreement, among other things:

“(4) A maintenance or repair agreement entered into by a homeowners' association in a common interest community.”

“(6) A declaration of any covenants, conditions, or restrictions created in the formation of a homeowners' association, a group of condominium owners, or other common interest community, or an amendment to the declaration.”

Ala. Code Chapter 8-42 already exists; SB 246 amended it rather than creating it. In the bill text these exclusions appear without change markers, which under Alabama's drafting convention means they are existing law carried forward — added text is underlined, deleted text struck through, and both are plainly visible elsewhere in the same bills.

So the accurate framing is: Alabama law already exempts association declarations and association maintenance contracts from its unfair-service-agreement regime, and it did so before either bill was filed. The bills would have expanded the regulation around that existing exemption.

One qualification on our own confidence: we established this from the amendment markup in the bill text rather than from a separately fetched copy of the current § 8-42-2, so the inference rests on the drafting convention.

What it changes for boards and managers

Directly, nothing. The carve-outs stand because they already stood, and the regulatory expansion that would have surrounded them did not pass.

Indirectly, there is one thing worth knowing. Wholesaling and unsolicited-offer activity is what these bills were responding to, and it lands on association property as unsolicited approaches to owners — particularly owners of vacant or inherited units, and particularly in markets under investor pressure. Alabama has now failed twice in one session to regulate it, so the practice continues unregulated beyond existing licensing law.

An association cannot police what offers its members receive. It can decline to hand over a membership roster to anyone who asks for one, which after Act 2026-495 is a question governed by the amended records-inspection provisions of the Alabama Nonprofit Corporation Law rather than by board discretion alone.

A correction worth carrying

The Alabama Association of REALTORS' own 2026 session recap describes Representative Hollis's wholesaling bill as “HB 315.” That is a different bill: HB 315 is the Class 1 municipality vacant-property registration measure, which was enacted as Act 2026-511. Hollis's wholesaling bill is HB 357. Anyone citing the AAR recap should not repeat its bill number.

AAR's account of its own position is worth quoting accurately, since it explains the outcome: it supported SB 246 and “also slowed progress on SB246 to allow additional time to work through concerns about potential unintended consequences,” and did not support HB 586 as drafted. Its summary of both: “Both bills were effectively dead for the year.”

What to watch next

Alabama has no carryover. Both bills must be filed fresh, and nothing can be prefiled before the Organizational Session on January 12, 2027; the Regular Session convenes February 2, 2027.

HB 586's posture makes it the more likely to return — a bill that passes one chamber 82–14 and reaches a third reading in the other is a bill with a constituency. But the entire Legislature stands for election first, and we found no sponsor on record committing to re-file.