We study quotients of principally polarized abelian varieties with real multiplication by Galois-stable finite subgroups and describe when these quotients are principally polarizable. We use this characterization to provide an algorithm to compute explicit cyclic isogenies from kernel for abelian varieties with real multiplication over finite fields. Our algorithm is polynomial in the size of the finite field as well as in the degree of the isogeny and is based on Mumford's theory of theta functions and theta embeddings. Recently, the algorithm has been successfully applied to obtain new results on the discrete logarithm problem in genus 2 as well as to study the discrete logarithm problem in genus 3.