Title Opinion
Generally completed by an attorney and discloses only defects which are apparent from the public record. The title opinion is a statement of the attorney’s professional judgment expressed, following a thorough title search, regarding the owner’s rights to the property. If the attorney is wrong about the owner’s rights to the property, the owner’s remedy is a claim for negligence against the attorney. A title opinion is completed after research of public records – often after the update of an abstract and is generally less expensive than title insurance.
Lender’s Policy
If you’ve ever mortgaged a home, chances are you were required to purchase a title insurance policy. This lender’s policy (often called a loan policy) is required by most lending institutions as a way to insure their security interest in the property. This policy protects the bank or other lending institution for as long as they maintain an interest in the property (typically until your mortgage is paid off).
Owner’s Policy
However, as a buyer, you also want to protect your investment – and the ownership rights that come with it. This is why it’s wise to purchase an owner’s policy of title insurance, which will protect your rights as the homeowner for as long as you or your heirs have an interest in the property. Both title insurance policies not only pay valid claims and legal fees to defend against hidden title issues, but also help to decrease ownership risks by providing a thorough title search prior to the issuance of either policy.