Have you ever been asked to provide a title opinion in connection with a real estate transaction? What does that mean? To me, it means that the client asks you to give your legal opinion as to the legal and factual validity of title ownership for a particular piece of land, and to note any matters of record that impact the title. That raises the question: Do you want to be personally responsible for that opinion?  More importantly, do you want to be personally responsible to the client or a third party if that opinion is incorrect?

What if the records are incomplete or inaccurate? Will you search title yourself or are you going to rely on a title abstractor? Will the abstractor have sufficient E&O coverage to protect you if they make a mistake?  Are you comfortable taking the risk that the abstractor did not miss anything in title? Lastly, why would you want to bear that risk when there is a national industry offering title insurance to protect parties from the same types of title risks that would be covered by a title opinion?

I think buyers and lenders look at these opinions as a guaranty that the opinion is correct. As a lawyer, you would never guarantee the outcome of litigation or settlement negotiations because there are too many factors that are outside of your control. In a perfect world, real estate or public records would contain no errors and no mis-indexing and there would be no forgery, fraud or people attempting to take advantage of the system. But we, our systems and our abstractors are not infallible. However, when lenders and buyers close a real estate transaction, they want certainty. 

In recent years there has been a push, especially with refinances and home equity mortgages, for lenders to accept an attorney opinion letter (commonly referred to as an “AOL”) in lieu of a title insurance policy.  At first, this may seem like an additional stream of revenue for your office, but you must weigh the benefits against the potential harm. 

A legal opinion is an analysis by an attorney subject to a promise of care, not an insurance contract.  If the legal opinion is wrong, the remedy is a claim of legal malpractice or negligence on the part of the attorney. 

In comparison, a title insurance policy is a contract of indemnity in which the title insurance company has certain obligations to its insureds pursuant to the terms of the policy. Coverage depends upon satisfaction of the commitment requirements and is subject to the specific exceptions as well as the conditions and exclusions of the policy jacket.   

While the perception may be that AOLs are faster and less expensive and appropriate where risk is considered low (refinances and HELOCs), The American Land Title Association (ALTA) and other industry leaders caution that an AOL does not provide the same level of protection as title insurance products. 

For attorneys, loss resulting from an inaccurate AOL could negatively impact a practice’s bottom line.  An attorney making a payout under an E&O policy may soon have an increased deductible or lose the policy altogether. A firm may see its reputation suffer in the community to a greater degree from a personal allegation of malpractice than from a claim against a title policy. 

There are companies that offer a variety of services which include AOL programs.  One such provider is Voxtur Analytics Corp.  Earlier this year Voxtur (and its 20+ affiliated entities) filed bankruptcy in Canada and has petitioned the U.S. Bankruptcy Court for the District of Delaware to be recognized and restructured under a Chapter 15 petition. According to online information, Voxtur has been suffering large losses for the last several years: $54.3 million in 2023, $73.6 million in 2024.  Reportedly, as of March 2025, its liabilities exceeded its assets by $33.2 million. 

Many lenders have relied on Voxtur’s AOL program and others like it in lieu of title insurance. The bankruptcy should cause these lenders and their servicers to question not only the reliability of such programs but also the longevity of the remedies available under such a program. As a result of the bankruptcy, parties that utilized Voxtur’s services must be questioning whether Voxtur will be able to satisfy any claims related to its AOL program. Voxtur should be a reminder to the industry that vendor insolvency is a real risk in the AOL model of risk allocation. 

So back to my original question: are AOLs worth the risk? Is it worth the risk to an attorney’s personal, professional liability or reputation to provide an opinion of title for a fee that may not match the potential risk? Is it worth the risk to fast-track a transaction or cut costs when the result may be to weaken the lending industry’s access to reliable protections in the event of title claims, especially for those matters which may be covered under certain title policies of insurance but would not be covered under an AOL?   

…Just a little food for thought as we digest all those holiday feasts. Cheers!