Investments in Affiliates

9 Months Ended

Sep. 30, 2011

Equity Method Investments and Joint Ventures [Abstract]

Investment in Affiliates

Investments in affiliates are accounted for under the equity method of accounting as we are deemed to have significant influence over the affiliate but do not control or have a majority voting interest in the affiliate. The investment is carried at the cost of acquisition, including subsequent capital contributions and loans from us, plus our equity in undistributed earnings or losses since acquisition. We record equity in earnings of affiliates net of tax. For the three and nine months ended September 30, 2011, income tax expense of $5.6 million and $13.6 million, respectively, was recorded on these earnings and for the same periods of the prior year income tax expense of $9.0 million and $19.5 million, respectively, was recorded on these earnings.

One of our subsidiaries owns a 50.1% interest in a joint venture that provides products and services used in connection with loan originations. This investment in an affiliate contributed 85% and 86.9% of our total equity in earnings of affiliates, net of tax, for the three and nine months ended September 30, 2011, respectively. This investment in an affiliate contributed 82.6% and 91.5% of our total equity in earnings of affiliates, net of tax, for the three and nine months ended September 30, 2010, respectively. Based on the terms and conditions of the joint venture agreement, we have significant influence but do not have control of, nor a majority voting interest in, the joint venture. Accordingly, this investment is accounted for under the equity method. Summarized financial information for this investment (assuming a 100% ownership interest) is as follows:



	For the Three Months Ended				For the Nine Months Ended
	September 30,				September 30,
(in thousands)	2011		2010		2011		2010
Statement of operations
Net revenues	$	105,187	$	131,994	$	279,500	$	347,703
Expenses	81,429		94,552		220,055		257,066
Income before income taxes	$	23,758	$	37,442	$	59,445	$	90,637
Net income	$	23,582	$	37,130	$	58,974	$	90,030
CoreLogic equity in earnings of affiliate	$	11,815	$	18,603	$	29,546	$	45,105

In March 2011, we acquired a 50.1% interest in Speedy Title & Appraisal Review Services LLC ("STARS") for $35.0 million, consisting of an initial cash payment of $20.0 million and a deferred purchase price of $15.0 million payable in three installments of $5.0 million (due on the first, third, and fifth anniversaries of the initial closing), which is non-interest bearing and was discounted to $12.7 million as of March 31, 2011. See Note 6 - Long-Term Debt. We have recorded $30.8 million of basis difference between the purchase price and our interest in the net assets of STARS, which is comprised of an indefinite-lived component of $9.7 million and a finite-lived component of $21.1 million with an estimated weighted average life of 9.3 years. The basis difference is classified as part of the investment in affiliates. Based on the terms and conditions of the joint venture agreement, we have significant influence but do not have control of, nor a majority voting interest in STARS; thus we account for our investment in STARS under the equity method of accounting.

In March and May 2011, we completed our acquisitions of the remaining controlling interest in Dorado Network Systems ("Dorado") and RP Data Limited ("RP Data"), respectively. For Dorado, a loss was previously recognized in the fourth quarter of 2010 and there was no further gain or loss on the acquisition of the controlling interest in 2011. For RP Data, we recorded an investment gain of approximately $58.9 million during the second quarter of 2011. Prior to our acquisition of these controlling interests, we accounted for our investments in Dorado and RP Data using the equity method. See Note 11 - Acquisitions for more information.

On September 22, 2011, we received a notice of intent from Veros Software, Inc. to exercise its option to purchase all of our membership interest in Veros Real Estate Solution, LLC. Although, as of September 30, 2011, we had not yet finalized the sale of the membership interest, the exercise value was below the net book value of our membership interest and we recorded an impairment charge of $0.8 million for the three and nine months ended September 30, 2011. In October 2011, we completed the sale of our interest and received proceeds of $8.0 million.

- Definition

The entire disclosure for equity investment, or group of investments, for which combined disclosure is appropriate, including: (a) the name of each investee and percentage of ownership of common stock, (b) accounting policies for investments in common stock, (c) difference between the amount at which the investment is carried and the amount of underlying equity in net assets and the accounting treatment of the difference, (d) the total fair value of each identified investment for which a market value is available, (e) summarized information as to assets, liabilities, and results of operations of the investees (for investments in unconsolidated subsidiaries, common stock of joint ventures, or other investments using the equity method), and (f) material effects of possible conversions, exercises, or contingent issuances of the investee. Other disclosures include (a) the names of any investee in which the investor owns 20 percent or more of the voting stock and investment is not accounted for using the equity method, and the reasons why not, and (b) the names of any investee in which the investor owns less than 20 percent of the voting stock and the investment is accounted for using the equity method, and the reasons why it is.

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