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Basis Of Presentation Basis of Presentation (Policies)
 9 Months Ended
Sep. 30, 2021
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Fair Value Measurement, Policy
The following tables present the Company’s assets and liabilities that are measured at fair value on a recurring basis and are categorized using the fair value hierarchy. The fair value hierarchy has three levels based on the reliability of the inputs used to determine fair value.
Level Input:Input Definitions:
Level I
Inputs are unadjusted, quoted prices for identical assets or liabilities in active markets at the
measurement date.
Level II
Inputs other than quoted prices included in Level I that are observable for the asset or liability through
corroboration with market data at the measurement date.
Level III
Unobservable inputs that reflect management’s best estimate of what market participants would use in
pricing the asset or liability at the measurement date.
The availability of observable inputs can vary from asset to asset and is affected by a wide variety of factors, including, for example, the type of asset, whether the asset is new and not yet established in the marketplace, and other characteristics particular to the transaction. To the extent that valuation is based on models or inputs that are less observable or unobservable in the market, the determination of fair value requires more judgment. Accordingly, the degree of judgment exercised by the Company in determining fair value is greatest for instruments categorized in Level III. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.  In such cases, for disclosure
purposes, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.
The fair value of financial instruments is generally determined by reference to quoted market values. In cases where quoted market prices are not available, fair value is based on estimates using present value or other valuation techniques, as appropriate. The fair value of interest rate swaps is determined based upon a discounted cash flow approach.
The Company measures financial instruments at fair value on a recurring basis and recognizes transfers within the fair value hierarchy at the end of the fiscal quarter in which the change in circumstances that caused the transfer occurred.
The following table summarizes fair value measurements by level at September 30, 2021 for assets and liabilities measured at fair value on a recurring basis:
Level ILevel IILevel IIITotal
Deferred compensation plan assets (included in other non-current assets)$1 $— $— $1 
Interest rate swaps (included in other non-current liabilities)— 57 — 57 
Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities)
— — 3 3 
The following table summarizes fair value measurements by level at December 31, 2020 for assets and liabilities measured at fair value on a recurring basis:
Level ILevel IILevel IIITotal
Deferred compensation plan assets (included in other non-current assets)$1 $— $— $1 
Interest rate swaps (included in other non-current liabilities)— 81 — 81 
Contingent consideration for acquisitions (included in accrued expenses and other current liabilities and other non-current liabilities)
— — 3 3 
The fair value of the Company’s contingent consideration for acquisitions is measured using a probability weighted-average discount rate to estimate future cash flows based upon the likelihood of achieving future operating results for individual acquisitions.  These assumptions are deemed to be unobservable inputs and as such the Company’s contingent consideration is classified within Level III of the valuation hierarchy. The Company reassesses the fair value of the contingent consideration liabilities on a quarterly basis.
The following table presents changes in Level III financial liabilities measured at fair value on a recurring basis:
Level III
Fair value of contingent consideration at December 31, 2020$3 
Additions: contingent consideration related to acquisitions completed during the period1 
Reductions: payments of contingent consideration
(1)
Changes in fair value (reflected in general and administrative expenses)— 
Fair value of contingent consideration at September 30, 2021$3 
The following table summarizes the principal amount of the Company’s indebtedness compared to the estimated fair value, primarily determined by quoted market values, at:
 September 30, 2021December 31, 2020
DebtPrincipal AmountEstimated
Fair Value (a)		Principal AmountEstimated
Fair Value (a)
Senior Secured Credit Facility:
Non-extended Revolving Credit Commitment$— $— $— $— 
Extended Revolving Credit Commitment— — — — 
Term Loan B— — 1,048 1,032 
Term Loan A Facility:
Non-extended Term Loan A— — 684 671 
Extended Term Loan A234 230 — — 
7.625% Senior Secured Second Lien Notes550 586 550 595 
4.875% Senior Notes407 422 407 415 
9.375% Senior Notes550 604 550 609 
5.75% Senior Notes900 932 — — 
0.25% Exchangeable Senior Notes403 406 — — 
_______________
(a)The fair value of the Company's indebtedness is categorized as Level II.
Equity Method Investments, Policy
Equity Method Investments
At September 30, 2021 and December 31, 2020, the Company had various equity method investments which are recorded within other non-current assets on the accompanying Condensed Consolidated Balance Sheets.
The Company's investment in Guaranteed Rate Affinity, LLC ("Guaranteed Rate Affinity") at Realogy Title Group had investment balances of $94 million and $90 million at September 30, 2021 and December 31, 2020, respectively. For the three months ended September 30, 2021 and 2020, the Company recorded equity earnings of $11 million and $51 million, respectively, related to its investment in Guaranteed Rate Affinity. For the nine months ended September 30, 2021 and 2020, the Company recorded equity earnings of $49 million and $95 million, respectively, related to its investment in Guaranteed Rate Affinity. The Company received $44 million and $56 million in cash dividends from Guaranteed Rate Affinity during the nine months ended September 30, 2021 and 2020, respectively.
The Company's other equity method investments had investment balances totaling $12 million and $10 million at September 30, 2021 and December 31, 2020, respectively. The Company recorded no equity earnings and $2 million equity earnings from the operations of these equity method investments for the three months ended September 30, 2021 and 2020, respectively. The Company recorded $3 million equity earnings from the operations of these equity method investments during both the nine months ended September 30, 2021 and 2020. The Company received $5 million and $3 million in cash dividends from these equity method investments during the nine months ended September 30, 2021 and 2020, respectively.
Income Tax, Policy
Income Taxes
The Company's provision for income taxes in interim periods is computed by applying its estimated annual effective tax rate against the income before income taxes for the period. In addition, non-recurring or discrete items are recorded in the period in which they occur. The provision for income taxes was an expense of $48 million and $36 million for the three months ended September 30, 2021 and 2020, respectively, and an expense of $125 million and a benefit of $110 million for the nine months ended September 30, 2021 and 2020, respectively.
Derivatives, Policy
Derivative Instruments
The Company records derivatives and hedging activities on the balance sheet at their respective fair values. The Company enters into interest rate swaps to manage its exposure to changes in interest rates associated with its variable rate borrowings. As of September 30, 2021, the Company had interest rate swaps with an aggregate notional value of $1,000 million to offset the variability in cash flows resulting from the term loan facilities as follows:
Notional Value (in millions)Commencement DateExpiration Date
$450November 2017November 2022
$400August 2020August 2025
$150November 2022November 2027
The swaps help to protect our outstanding variable rate borrowings from future interest rate volatility. The Company has not elected to utilize hedge accounting for these interest rate swaps; therefore, any change in fair value is recorded in the Condensed Consolidated Statements of Operations.
The fair value of derivative instruments was as follows:
Not Designated as Hedging InstrumentsBalance Sheet LocationSeptember 30, 2021December 31, 2020
Interest rate swap contractsOther non-current liabilities57 81 
The effect of derivative instruments on earnings was as follows:
Derivative Instruments Not Designated as Hedging InstrumentsLocation of Loss or (Gain) Recognized for Derivative InstrumentsLoss or (Gain) Recognized on Derivatives
Three Months Ended September 30, Nine Months Ended September 30,
2021202020212020
Interest rate swap contractsInterest expense$(1)$— $(8)$59 
Revenue, Policy
Revenue
Revenue is recognized upon the transfer of control of promised services to customers in an amount that reflects the consideration the Company expects to receive in exchange for those services in accordance with the revenue standard.  The Company's revenue is disaggregated by major revenue categories on our Condensed Consolidated Statements of Operations and further disaggregated by business segment as follows:
Three Months Ended September 30,
Realogy Franchise GroupRealogy Brokerage GroupRealogy Title
Group		Corporate and OtherTotal
Company
2021202020212020202120202021202020212020
Gross commission income (a)$— $— $1,689 $1,458 $— $— $— $— $1,689 $1,458 
Service revenue (b)66 65 7 9 242 207 — — 315 281 
Franchise fees (c)247 227 — — — — (108)(94)139 133 
Other (d)29 22 9 12 8 6 (3)(3)43 37 
Net revenues$342 $314 $1,705 $1,479 $250 $213 $(111)$(97)$2,186 $1,909 
Nine Months Ended September 30,
Realogy Franchise GroupRealogy Brokerage GroupRealogy Title
Group		Corporate and OtherTotal
Company
2021202020212020202120202021202020212020
Gross commission income (a)$— $— $4,616 $3,227 $— $— $— $— $4,616 $3,227 
Service revenue (b)173 190 22 18 683 494 — — 878 702 
Franchise fees (c)687 502 — — — — (296)(213)391 289 
Other (d)83 69 29 36 23 16 (11)(7)124 114 
Net revenues$943 $761 $4,667 $3,281 $706 $510 $(307)$(220)$6,009 $4,332 
______________
(a)Gross commission income at Realogy Brokerage Group is recognized at a point in time at the closing of a homesale transaction.
(b)Service revenue primarily consists of title and escrow fees at Realogy Title Group and are recognized at a point in time at the closing of a homesale transaction. Service revenue at Realogy Franchise Group includes relocation fees, which are recognized as revenue when or as the related performance obligation is satisfied dependent on the type of service performed, and fees related to leads and related services, which are recognized at a point in time at the closing of a homesale transaction or at the completion of the related service.
(c)Franchise fees at Realogy Franchise Group primarily include domestic royalties which are recognized at a point in time when the underlying franchisee revenue is earned (upon close of the homesale transaction).
(d)Other revenue is comprised of brand marketing funds received from franchisees at Realogy Franchise Group and other miscellaneous revenues across all of the business segments.
The following table shows the change in the Company's contract liabilities (deferred revenue) related to revenue contracts by reportable segment for the period:
 Beginning Balance at January 1, 2021Additions during the periodRecognized as Revenue during the periodEnding Balance at September 30, 2021
Realogy Franchise Group:
Deferred area development fees (a)$43 $1 $(4)$40 
Deferred brand marketing fund fees (b)14 78 (71)21 
Deferred outsourcing management fees (c)3 31 (30)4 
Other deferred income related to revenue contracts10 24 (23)11 
Total Realogy Franchise Group 70 134 (128)76 
Realogy Brokerage Group:
Advanced commissions related to development business (d)9 2 — 11 
Other deferred income related to revenue contracts3 2 (2)3 
Total Realogy Brokerage Group12 4 (2)14 
Total$82 $138 $(130)$90 
_______________
(a)The Company collects initial area development fees ("ADF") for international territory transactions, which are recorded as deferred revenue when received and recognized into franchise revenue over the average 25 year life of the related franchise agreement as consideration for the right to access and benefit from Realogy’s brands. In the event an ADF agreement is terminated prior to the end of its term, the unamortized deferred revenue balance will be recognized into revenue immediately upon termination.
(b)Revenues recognized include intercompany marketing fees paid by Realogy Brokerage Group.
(c)The Company earns revenues from outsourcing management fees charged to clients that may cover several of the relocation services listed above, according to the clients' specific needs. Outsourcing management fees are recorded as deferred revenue when billed (usually at the start of the relocation) and are recognized as revenue over the average time period required to complete the transferee's move, or a phase of the move that the fee covers, which is typically 3 to 6 months depending on the move type.
(d)New development closings generally have a development period of between 18 and 24 months from contracted date to closing.
Receivables, Trade and Other Accounts Receivable, Allowance for Doubtful Accounts, Policy
Allowance for Doubtful Accounts
The Company estimates the allowance necessary to provide for uncollectible accounts receivable. The estimate is based on historical experience, combined with a review of current conditions and forecasts of future losses, and includes specific accounts for which payment has become unlikely. The process by which the Company calculates the allowance begins in the individual business units where specific problem accounts are identified and reserved primarily based upon the age profile of the receivables and specific payment issues, combined with reasonable and supportable forecasts of future losses.
New Accounting Pronouncements, Policy
Recently Adopted Accounting Pronouncements
The Company adopted the new standard on Simplifying the Accounting for Income Taxes effective January 1, 2021. The new standard clarifies and simplifies aspects of the accounting for income taxes to help promote consistent application of GAAP by eliminating certain exceptions to the general principles of ASC Topic 740, Income Taxes. The adoption of this guidance did not have an impact to the Company’s Consolidated Financial Statements upon adoption on January 1, 2021.
Recently Issued Accounting Pronouncements
The Company considers the applicability and impact of all Accounting Standards Updates ("ASUs"). Recently issued standards were assessed and determined to be either not applicable or are expected to have minimal impact on our consolidated financial position or results of operations.
The FASB issued its new standard on Accounting for Convertible Instruments and Contracts in an Entity’s Own Equity which simplifies the accounting for instruments with characteristics of liabilities and equity, including convertible debt. The new standard reduces the number of accounting models for convertible debt instruments and convertible preferred stock resulting in fewer embedded conversion features being separately recognized from the host contract and the interest rate of more convertible debt instruments being closer to the coupon interest rate, as compared with current guidance. The new standard also amends the derivative guidance for the “own stock” scope exception, which exempts qualifying instruments from being accounted for as derivatives if certain criteria are met. In addition, the standard changes the diluted earnings per share calculation for instruments that may be settled in cash or shares and for convertible instruments. The new standard is effective for reporting periods beginning on or after December 15, 2021 and permits the use of either the modified retrospective or fully retrospective method of transition. The Company plans to adopt the new standard on January 1, 2022 using the modified retrospective approach and is currently evaluating the impact of adopting this standard on the Company's financial statements.