Kyle leaked bank loan documents for Encino house to invest in restaurant chain with daughter's boyfriend - deal lost nearly $600,000

Reality TV darling Kyle Richards is once again caught in the crosshairs of controversy – this time not for her crumbling marriage or her cryptic relationship with country singer Morgan Wade, but for what insiders are calling a “high-risk financial play gone horribly wrong.”

According to exclusive documents obtained by sources close to the deal, Kyle Richards allegedly used her Encino property as collateral for a private loan valued at over $1.2 million to invest in a new luxury restaurant chain – co-founded by none other than her daughter’s boyfriend.

The documents, which include mortgage refinancing paperwork filed in early 2023, show a large cash-out amount that was not declared on any public RHOBH storyline. Instead, the money was quietly funneled into what one source described as a “vanity-driven hospitality venture” with zero industry experience behind it.

The investment, initially pitched as a “Beverly Hills meets Malibu” dining experience with plans to expand into West Hollywood and Miami, collapsed just six months into operations due to overwhelming startup costs, poor location choices, and internal conflict between partners. The project’s total losses are estimated at nearly $600,000, leaving Kyle to shoulder the financial fallout almost entirely on her own.

Insiders say Kyle’s inner circle had warned her against mixing personal life with business – especially involving someone tied to her daughter emotionally – but the reality star was reportedly “blinded by optimism” and convinced that the deal would “open new doors outside of Bravo.”

Worse yet, the leak of the mortgage documents comes at a particularly vulnerable time for Kyle. Her separation from longtime husband Mauricio Umansky has been under intense public scrutiny, and this financial misstep is now adding fuel to the fire. Some sources close to the Umansky family even suggest that Mauricio was unaware of the refinancing until after the restaurant deal fell apart.

“This is not just a loss,” one insider commented. “It’s a humiliation. Kyle has always prided herself on being the ‘smart Richards sister,’ the one with control over her brand. But this looks reckless. Risky. And frankly, desperate.”

The fallout has already begun. Real estate watchers noted that Kyle’s Encino mansion was quietly re-listed for appraisal earlier this year, sparking rumors that she might be considering selling off the home to stabilize her cash flow. Meanwhile, Bravo fans are speculating whether this latest financial drama will finally be addressed in the upcoming season of The Real Housewives of Beverly Hills – or whether it will be swept under the Persian rug, as many of Kyle’s off-camera dealings tend to be.

When reached for comment, Kyle’s rep declined to respond, citing “ongoing private matters.” Calls to the daughter’s boyfriend – now no longer involved with the restaurant group – also went unanswered.

With a failed investment, a strained marriage, and mounting questions about her financial footing, Kyle Richards’ future on RHOBH looks murkier than ever.

And for Bravo fans? The real drama might just be starting.