Royal Development

About Royal Development

Royal Development is an Irvine, CA based private lender. They provide funding in California, Texas, and Washington. They offer short term loans, new construction loans, commercial hard money loans, rental property loans, private refinancing, and fix-and-flip loans. Their loan parameters are flexible, including terms between 6 months and 24 months, loan amounts ranging from $100,000 to $5,000,000 with a maximum LTV of 70%, and rates ranging between 9% and 12%. They do not require borrowers to have a minimum credit rating to receive a loan. They provide loans on all the following types of properties: single family homes, multi family residences, retail storefronts, offices, industrial facilities, mixed use spaces, and hotels.

Loan Types Offered: Investment Property Loans, Fix and Flip Loans, Commercial Hard Money Loans, New Construction Loans, Refinance / Cash Out Loans, Bridge Loans

Property Types Covered: Single Family, Multi Family, Retail, Office, Industrial, Mixed Use, Hotel

Areas Served: CA, TX, WA

Licenses: CA BRE License # 2007498

Lending Guidelines for Royal Development

Below are the general loan guidelines published on the Royal Development 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 Royal Development.

Loan Example 1

Kurt is a real estate investor in Houston, TX. He finds an older property for sale and wants to renovate it and sell it for a profit. The property has a cost of $180,000 but he doesn't have the full amount so he takes out a fix-and-flip loan with Royal Development. The terms of the loan include a 85% loan-to-value (LTV), so he must contribute 15% of the price as cash to closing, which makes the principle note amount $153,000. The note is interest only, paid monthly, and is for 12 months at 9% interest with 1 origination points paid when the deal closes.

In accordance with the terms of the loan, Kurt will have to pay a $1,530 origination fee in addition to 15% of the purchase price, or $27,000, based on the 85% LTV. The lender will collect $1,148 in monthly interest from the Kurt. This is calculated by taking the total note value of $153,000, multiplying by the 9% interest rate, and then dividing that amount by 12. Kurt's plan is to complete the rehab within the 12 months and re-sell it for $270,000. If he succeeds he will make a total profit of $74,700 ($270,000 sales price - $153,000 principle - $27,000 cash at closing - $1,530 origination fee - $13,770 in interest.

Loan Example 2

Louise takes a fix and flip loan from Royal Development in order to rehab a townhouse to flip in Houston, TX. The loan has the following parameters:

$280,000 purchase price
85% loan to value (LTV)
12 month term
10% rate of interest
5% origination fee

Once the rehab project is completed, if Louise sells the house for $392,000, the numbers would be the following:

$392,000 sales price
- $238,000 principle (85% LTV)
- $42,000 down payment (15% on 85% LTV)
- $11,900 origination fee (5% of the $238,000 principle)
- $23,800 interest payments (12 months x 10% interest)
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= $76,300 gross profit (does not include taxes or rehab costs)

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