Red Door Funding

About Red Door Funding

Red Door Funding is a private money lender based in Stafford, TX providing loans in Houston, Austin, and San Antonio. They provide lending solutions for many different scenarios, including buy and hold loans and fix-and-flip loans. They provide loans with a maximum LTV of 70%, rates from 14%, and terms up to 6 months. The focus of their lending is for single family units and multi-family units.

Loan Types Offered: Investment Property Loans, Fix and Flip Loans

Property Types Covered: Single Family, Multi Family

Areas Served: Houston, Austin, San Antonio

Lending Guidelines for Red Door Funding

Below are the general loan guidelines published on the Red Door Funding website. Please confirm all terms and rates directly with the lender.

Loan Examples

The following loans are for education purposes only. They do not represent actual loans executed by Red Door Funding.

Loan Example 1

Andrew finds a duplex in Houston, TX to renovate and sell. Since he doesn't have enough cash to purchase the $210,000 property outright, he takes out a private money loan from Red Door Funding. Because the lender sets a 75% loan-to-value, Andrew will have to put 25% down and the total amount of the loan will be $157,500. The loan is interest-only, with monthly payments, and is for 18 months at 12% interest with 2 origination points paid when the deal closes.

Andrew will have to contribute $52,500 at the closing (25% on the 75% loan to value), plus he will have to pay the $3,150 origination fee. Once the loan closes, he will have to pay the lender $1,575 in monthly interest fees, or 12% times $157,500 divided by 12 months in the year. If Andrew sells the property for $315,000 after 18 months, he would then realize a total profit of $73,500 after subtracting the principle amount of $157,500, the cash contributed at closing of $52,500, the origination points of $3,150, and the total interest payments of $28,350. This amount doesn't include remodeling costs.

Loan Example 2

Rhonda takes a fix and flip loan from Red Door Funding so she can rehab a townhome to flip in Houston, TX. The deal has the following terms:

$350,000 purchase price
50% loan-to-value (LTV)
6 month term
11% interest rate
3% origination fee

Rhonda plans to sell the house at the end of the term for $507,500. If she accomplishes her goal, the final numbers would be the following:

$507,500 sales price
- $175,000 principle on note (50% LTV)
- $175,000 cash paid at closing (50% on 50% LTV)
- $5,250 origination fee (3% of the $175,000 principle)
- $9,625 interest payments (6 months x 11% interest)
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= $142,625 total profit (does not include taxes or rehab costs)