Royal United Mortgage LLC, an Indianapolis-based mortgage firm, announced plans Tuesday to expand its local operations, adding up to 140 employees by 2013.

The three-year-old firm said it will spend $1.85 million to lease a new office on the north side of the city.

Royal United currently has 151 employees in Indianapolis, and said it has already begun hiring additional mortgage advisory, operations, technology and servicing associates.

The Indiana Economic Development Corp. offered Royal United up to $1 million in performance-based tax credits and up to $120,000 in training grants based on the company's job-creation plans. The city will consider additional property-tax abatement.

Royal United was started in 2008 by Craig Royal and Michael Keleher with 22 employees.The company offers loans for home purchases, refinancing and debt consolidation.

Royal, the firm's chairman and CEO, was chief financial officer at Oak Street Financial Services LLC from 1999 to 2007. Oak Street, which specialized in non-conforming loans, was one of the area's fastest-growing companies for almost a decade and had more than 700 employees at its peak. It attempted a $150 million initial public offering in 2004 but called it off in 2005 when profits began to slip.

Oak Street filed for Chapter 11 bankruptcy in 2007 amid the subprime lending meltdown after selling most of its assets to Kansas City, Mo.-based Novastar Financial.