Investing in Mortgages – Overview

Investing in Mortgages

Mortgages make up a big part of a Canadian bank’s business model. This is a good indication that investing in mortgages is not only lucrative but also secure compared to many other alternative investment options. It’s our mission to open up the mortgage investment market to the public and add mortgages to your investment portfolio as an alternative to stock market-based assets, such as mutual funds.

The CMI MIC provides a way for individuals and corporate investors to access Canadian real estate markets and take advantage of economies of scale not available to them as individuals. Investors pool their money by buying shares in a company called a Mortgage Investment Corporation (MIC). The MIC invests these funds in mortgages that generate a yield through interest rates and fees charged to the borrowers. This yield produces monthly cash flow for its investors.

The MIC’s management is responsible for all facets of the MICs operations: sourcing of mortgage opportunities, analysis and underwriting of mortgages, and structuring and facilitating the related legal transactions. The MIC then manages and administers the entire mortgage portfolio comprised of these individual mortgage investments.

Extensive oversight from different regulatory bodies ensures transparency and security. The Office of the Registrar of Mortgage Brokers at the Financial Institutions Commission regulates the mortgage brokering and lending activities of MICs under the Mortgage Brokers Act. We file our Offering Memorandum and audited financial statements annually with the Ontario Securities Commission.

Who borrows from CMI MIC?

While banks are readily available sources of loans, recent legislation has required banks to adjust and restrict their mortgage lending policies. Borrowers who previously qualified for bank loans may now be rejected. This is where CMI MIC can step in and fill the gap. Investors, through the MIC, can assist these individuals, while earning a healthy and stable return.

CMI MIC was designed to be investor-friendly, where the Management Team takes care of all the details so investors can relax while their monies grow. Investing in the CMI MIC allows you to take part in a sophisticated investment strategy without the necessity of extensive experience or industry knowledge.

MICs can also be a more secure and safe option compared to investing directly in real estate. When you invest in a MIC, you are investing in mortgages, which are less vulnerable to fluctuating property values. MICs also offer protection in the form of a fixed interest rate during the investment period.

Advantages of Investing in a MIC

  • Investing in a MIC spreads the investment across a large pool of mortgages, mitigating the risk from investing in single specific mortgages
  • MIC Manager actively manages the investments and mortgages, providing an investor with a hands-off investment experience
  • The MIC is subject to Federal regulations and the provisions of the Canadian Income Tax Act along with Securities Commissions oversight
  • A MIC invests in mortgages secured by real estate whereas a real estate investment trust (REIT) invests in the property itself. A MIC draws its income from mortgage payments by the property owners, whereas a REIT draws its income through rents collected from tenants
  • Mortgage payments provide for predictable, steady, monthly income while providing safety and security to the investor
  • A MIC’s financial statements must be audited each year, similar to the auditing process of a publicly traded company

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RRSP Eligible

You can utilize your RRSP funds to invest in a MIC fund directly. The income earned by your RRSP investments are tax-free. As a result, the tax-free interest earned from a MIC held in your RRSP can compound tax-free and you don’t have to worry about paying taxes on your profits until you withdraw them from your RRSP.

When investing in an RRSP, you are offered certain investment choices, such as mutual funds or GICs. For most investors, the average performance of RRSP investments has been unsatisfactory at best. That’s not to say you have no choice but to accept the status quo.

CMI MIC Advantages

The CMI MIC provides a way for individuals and corporate investors to access Canadian real estate markets and take advantage of economies of scale not available to them as individuals. Typical MIC investments include first and second mortgages on residential property.
Management fees are absorbed into the overarching entity

As the CMI MIC is under the CMI umbrella, the management fees associated with operating the MIC are absorbed into the overarching entity. Maintaining the CMI MIC under the same roof greatly reduces the expense ratio and provides for lower overhead resulting in lower fees relative to other MICs. The savings are passed onto our investors and stronger net returns to investors result.

CMI MIC engages a team of underwriters with both depth and breadth of experience

It is crucial to understand the background and experience of the mortgage underwriting team behind each loan that is processed. Whereas banks generally have relatively inexperienced mortgage underwriters with multiple levels of bureaucracy involved in the underwriting and approval process. CMI MIC engages a team of underwriters with both depth and breadth of experience. This level of expertise adds to the speed at which the loans can be processed while maintaining a high level of due diligence. Not only is this a value-added service for time-pressed borrowers, but it also protects the capital of the MIC investors.

Quicker decisions driven by thorough due diligence

Experience and a reduced bureaucracy provide for quicker decisions driven by thorough due diligence providing for an efficient underwriting process. We strive to maximize returns through the sourcing and efficient management of our mortgage investments.

Take control of your RRSP investments rather than leaving a financial services institution to gamble with your money. When you change your RRSP to a self-directed RSP (SDRSP), you can invest in mortgages just like a bank.
  • Targeted annual returns of 8-9%
  • Fixed interest rates allow for predictable cash flow
  • Fixed interest rates allow for predictable cash flow
  • Diversity through the pooling of funds with other investors into multiple mortgages
  • RRSP, RRIF, RESP, LIRA, TFSA eligible


Investing in mortgages through the CMI MIC protects against risks by concentrating on stable, high-growth and recession resistant real estate markets across Canada. Some examples of how we mitigate risk include:
  • Focus on low-risk, residential mortgages that fall just outside the traditional bank lenders’ criteria
  • Extensive experience in coordination with a regimented underwriting methodology
  • Offering a large, diversified pool of mortgages across different stable real estate markets in Canada
  • Limiting loan to value (LTV) ratios to under 75% ensuring there is low risk exposure
Take control of your investment and gain transparency to where your money is going.

Strong Consistent Returns

All savvy investors understand that there is a positive correlation between risk and return. Our lending activity focuses on real estate markets that are inherently stable with sound economic fundamentals. CMI MIC investors can participate with relatively small amounts of capital and have the opportunity to achieve healthy investment returns while still minimizing risk.


An investment in CMI MIC is held in the form of MIC shares that can, in turn, be held either directly, or in an RRSP, RRIF or TFSA. CMI MIC can assist in facilitating the setup of a self-directed RRSP or RRIF through the trustees it usually deals with. When it comes to liquidity, CMI MIC offers penalty-free redemptions after 24 months, with 90 days’ notice (some restrictions apply).