DISCONTINUED OPERATIONS (Tables)

12 Months Ended

Dec. 31, 2012

RealEstate.com

DISCONTINUED OPERATIONS

Schedule of revenue and net income (loss) of the discontinued operations

The revenue and net loss for the Real Estate businesses that are reported as discontinued operations for the years ended December 31, 2012 and 2011 were as follows (in thousands):

	Year Ended December 31,
	2012			2011
Revenue	$	93		$	3,857
Loss before income taxes	$	(410	)	$	(16,804	)
Income tax expense		—			—
Gain from sale of discontinued operations, net of tax		—			7,752
Net loss	$	(410	)	$	(9,052	)

Schedule of assets and liabilities of the discontinued operations

The assets and liabilities of Real Estate that are reported as discontinued operations as of December 31, 2012 and December 31, 2011 were as follows (in thousands):

	December 31, 2012			December 31, 2011
Current assets	$	—		$	33
Current liabilities		206			702
Non-current liabilities		—			54
Net assets (liabilities)	$	(206	)	$	(723	)

Lending Tree Loans

DISCONTINUED OPERATIONS

Schedule of revenue and net income (loss) of the discontinued operations

The revenue and net income (loss) for LendingTree Loans that are reported as discontinued operations for the years ended December 31, 2012 and 2011 were as follows (in thousands):

	Year Ended December 31,
	2012			2011
Revenue	$	86,740		$	117,509
Income (loss) before income taxes	$	26,160		$	(741	)
Income tax benefit (expense)		(1,249	)		—
Gain from sale of discontinued operations, net of tax		24,373			—
Net income (loss)	$	49,284		$	(741	)

Schedule of assets and liabilities of the discontinued operations

The assets and liabilities of LendingTree Loans that are reported as discontinued operations as of December 31, 2012 and December 31, 2011 were as follows (in thousands):

	December 31, 2012			December 31, 2011
Loans held for sale	$	—		$	217,467
Other current assets		407			14,925
Current assets		407			232,392
Property and equipment		—			4,181
Goodwill		—			5,579
Other non-current assets		129			1,187
Non-current assets		129			10,947
Warehouse lines of credit		—			197,659
Other current liabilities		30,811			51,669
Current liabilities		30,811			249,328
Non-current liabilities		253			978
Net assets (liabilities)	$	(30,528	)	$	(6,967	)

Schedule of loans held for sale by type of loan

The following table represents the loans held for sale by type of loan as of December 31, 2011 ($ amounts in thousands):

	December 31, 2011
	Amount		%
Conforming	$	$171,375		79	%
FHA and Alt-A		40,433		18	%
Jumbo		5,659		3	%
Total	$	217,467		100	%

Schedule of difference between the aggregate principal balance of loans on nonaccrual status for which the fair value option has been elected and for loans measured at lower of cost or market valuation

The following presents the difference between the aggregate principal balance of loans on nonaccrual status for which the fair value option has been elected and for loans measured at lower of cost or market valuation as of December 31, 2012 and December 31, 2011 (in thousands):

	As of December 31, 2012
	Loans on Nonaccrual— Measured at Fair Value			Loans on Nonaccrual— Measured at LOCOM		Total Loans on Nonaccrual
Aggregate unpaid principal balance	$	412		$	—	$	412
Difference between fair value and aggregate unpaid principal balance		(412	)		—		(412	)
Loans on nonaccrual	$	—		$	—	$	—

	As of December 31, 2011
	Loans on Nonaccrual— Measured at Fair Value			Loans on Nonaccrual— Measured at LOCOM		Total Loans on Nonaccrual
Aggregate unpaid principal balance	$	539		$	—	$	539
Difference between fair value and aggregate unpaid principal balance		(244	)		—		(244	)
Loans on nonaccrual	$	295		$	—	$	295

Schedule of assets and liabilities that are measured at fair value on a recurring basis

The following presents our assets and liabilities that are measured at fair value on a recurring basis at December 31, 2011 (in thousands):

	As of December 31, 2011
	Recurring Fair Value Measurements Using
	Quoted Market Prices in Active Markets for Identical Assets (Level 1)		Significant Other Observable Inputs (Level 2)			Significant Unobservable Inputs (Level 3)		Total Fair Value Measurements
Loans held for sale	$	—	$	217,172		$	295	$	217,467
Interest rate lock commitments ("IRLCs")		—		—			9,122		9,122
Forward delivery contracts		—		(4,107	)		19		(4,088	)
Total	$	—	$	213,065		$	9,436	$	222,501

Schedule of changes in assets and liabilities that are measured at fair value on a recurring basis using significant unobservable inputs (Level 3)

The following presents the changes in our assets and liabilities that are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) for the years ended December 31, 2012 and 2011 (in thousands):

	December 31, 2012
	Interest Rate Lock Commitments			Forward Delivery Contracts			Loans Held for Sale
Balance at January 1, 2012	$	9,122		$	19		$	295
Transfers into Level 3		—			—			564
Transfers out of Level 3		—			(845	)		—
Total net gains (losses) included in earnings (realized and unrealized)		73,378			846			(147	)
Purchases, sales, and settlements
Purchases		—			—			—
Sales		(5,640	)		(20	)		(491	)
Settlements		(3,401	)		—			(221	)
Transfers of IRLCs to closed loans		(73,459	)		—			—
Balance at December 31, 2012	$	—		$	—		$	—

	December 31, 2011
	Interest Rate Lock Commitments			Forward Delivery Contracts			Loans Held for Sale
Balance at January 1, 2011	$	5,986		$	3		$	884
Transfers into Level 3		—			—			859
Transfers out of Level 3		—			(285	)		—
Total net gains (losses) included in earnings (realized and unrealized)		114,889			359			(87	)
Purchases, sales, and settlements
Purchases(a)		970			(58	)		—
Sales		—			—			(1,041	)
Settlements		(11,977	)		—			(320	)
Transfers of IRLCs to closed loans		(100,746	)		—			—
Balance at December 31, 2011	$	9,122		$	19		$	295

(a)

Purchased in conjunction with the acquisition of certain assets of SurePoint.

Schedule of gains (losses) included in earnings relating to assets and liabilities that are measured at fair value on a recurring basis using significant unobservable inputs (Level 3)

The following presents the gains (losses) included in earnings for the years ended December 31, 2012 and 2011 relating to our assets and liabilities that are measured at fair value on a recurring basis using significant unobservable inputs (Level 3) (in thousands):

	Year Ended December 31, 2012							Year Ended December 31, 2011
	Interest Rate Lock Commitments		Forward Delivery Contracts		Loans Held for Sale			Interest Rate Lock Commitments		Forward Delivery Contracts		Loans Held for Sale
Total net gains (losses) included in earnings, which are included in discontinued operations	$	73,378	$	846	$	(147	)	$	114,889	$	359	$	(87	)
Change in unrealized gains (losses) relating to assets and liabilities still held at December 31, 2012 and 2011, which are included in discontinued operations	$	—	$	—	$	(412	)	$	9,122	$	19	$	(38	)

Summary of derivative instruments not designated as hedging instruments

The following table summarizes our derivative instruments not designated as hedging instruments as of December 31, 2011 (in thousands):

	December 31, 2011
	Balance Sheet Location	Fair Value
Interest Rate Lock Commitments	Current assets of discontinued operations	$	9,282
Forward Delivery Contracts	Current assets of discontinued operations		480
Interest Rate Lock Commitments	Current liabilities of discontinued operations		(160	)
Forward Delivery Contracts	Current liabilities of discontinued operations		(4,568	)
Total Derivatives		$	5,034

Schedule of gain/(loss) recognized in the consolidated statements of operations for derivatives

The gain (loss) recognized in the consolidated statements of operations for derivatives for the periods ended December 31, 2012 and 2011 was as follows (in thousands):

	Location of Gain (Loss) Recognized in Income on Derivative	Year Ended December 31, 2012		Year Ended December 31, 2011
Interest Rate Lock Commitments	Discontinued operations	$	73,378	$	114,889
Forward Delivery Contracts	Discontinued operations		4,244		(4,938	)
Total		$	77,622	$	109,951

Schedule of difference between the aggregate principal balance of loans held for sale for which the fair value option has been elected and for loans measured at LOCOM

The following presents the difference between the aggregate principal balance of loans held for sale for which the fair value option has been elected and for loans measured at LOCOM, as of December 31, 2012 and 2011 (in thousands):

	As of December 31, 2012
	Loans Held for Sale— Measured at Fair Value			Loans Held for Sale— Measured at LOCOM		Total Loans Held For Sale
Aggregate unpaid principal balance	$	412		$	—	$	412
Difference between fair value and aggregate unpaid principal balance		(412	)		—		(412	)
Loans held for sale	$	—		$	—	$	—

	As of December 31, 2011
	Loans Held for Sale— Measured at Fair Value		Loans Held for Sale— Measured at LOCOM		Total Loans Held For Sale
Aggregate unpaid principal balance	$	208,918	$	—	$	208,918
Difference between fair value and aggregate unpaid principal balance		8,549		—		8,549
Loans held for sale	$	217,467	$	—	$	217,467

Schedule of loans sold for the period and the aggregate loan losses

	As of December 31, 2012
Period of Loan Sales	Number of loans sold		Original principal balance		Number of loans with losses		Original principal balance of loans with losses		Amount of aggregate losses
			(in billions)				(in millions)		(in millions)
2012		9,200	$	1.9		—	$	—	$	—
2011		12,500		2.7		1		0.3		0.1
2010		12,400		2.8		4		1.1		0.1
2009		12,800		2.8		4		0.9		0.1
2008		11,000		2.2		33		6.9		2.2
2007		36,300		6.1		160		22.1		8.2
2006		55,000		7.9		207		24.5		13.4
2005 and prior years		86,700		13.0		89		12.3		5.0
Total		235,900	$	39.4		498	$	68.1	$	29.1

Schedule of activity related to loss reserves on previously sold loans

The activity related to loss reserves on previously sold loans for the years ended December 31, 2012 and 2011, is as follows (in thousands):

	December 31,
	2012			2011
Balance, beginning of period	$	31,512		$	16,984
Provisions		6,977			16,798
Change in estimate		(6,493	)		—
Charge-offs to reserves		(4,814	)		(2,270	)
Balance, end of period	$	27,182		$	31,512