Minnesota State Real Estate Practice Test 2026 - Free Real Estate Practice Questions and Study Guide

The primary function of a title company in a real estate transaction is to research and guarantee property ownership. This process involves conducting a thorough title search to ensure that the seller has legal ownership of the property and that there are no liens or claims against it that could affect the buyer's ownership rights.

Additionally, title companies also provide title insurance, which protects the buyer and lender from any future claims to the property that may have been overlooked during the title search. This ensures that the buyer receives clear title to the property, which is essential for security in real estate transactions. The role of the title company is crucial in providing peace of mind for both buyers and lenders, as it mitigates the risk associated with transferring property ownership.

Other choices, while related to real estate, do not accurately reflect the specific and primary role of title companies. Legal representation for buyers falls under the purview of real estate attorneys, managing property listings is typically the role of real estate agents, and low-interest loans are offered by financial institutions or lenders, not title companies. Each of these alternative options highlights different aspects of the real estate process but does not align with the essential services provided by title companies.