Do you invest in a Mortgage Investment Corporation (MIC)?
Hey everyone,
A few of my family members and some friends have told me about these Mortgage Investment Corporations (MICS) and they consistently yield 6-8%.
Is anyone invested in these, if not, why?
They are eligible for TFSA and RRSP accounts, which is a nice bonus.
The MIC i'm looking at (Antrim) has a Loan to Value ratio of <60%. Which means a house worth $100k, they will lend out a maximum of $60k against the house. Also, the majority of the loans are 1st mortgages. There are MICS that have higher 2nd mortgages, but the comes with added risk, but a higher yield at the end of the year. The average mortgage is about $350k and since there is so much demand for lending, they say they are very picky about who they lend to, so the mitigate risk that way.
I was just wondering if any of you had any comments on MICs in general and if you do or don't have a position in this. For my overall portfolio, I would be allocating no more than 20% of my portfolio to it. I'm just weary because these just seem like they're too good to be true. Though, I guess you could consider these MICs like banks, which goes to show how much profit banks make.
Any comments would be appreciated.
edit: I meant to type Antrim*** NOT Atrium
A few of my family members and some friends have told me about these Mortgage Investment Corporations (MICS) and they consistently yield 6-8%.
Is anyone invested in these, if not, why?
They are eligible for TFSA and RRSP accounts, which is a nice bonus.
The MIC i'm looking at (Antrim) has a Loan to Value ratio of <60%. Which means a house worth $100k, they will lend out a maximum of $60k against the house. Also, the majority of the loans are 1st mortgages. There are MICS that have higher 2nd mortgages, but the comes with added risk, but a higher yield at the end of the year. The average mortgage is about $350k and since there is so much demand for lending, they say they are very picky about who they lend to, so the mitigate risk that way.
I was just wondering if any of you had any comments on MICs in general and if you do or don't have a position in this. For my overall portfolio, I would be allocating no more than 20% of my portfolio to it. I'm just weary because these just seem like they're too good to be true. Though, I guess you could consider these MICs like banks, which goes to show how much profit banks make.
Any comments would be appreciated.
edit: I meant to type Antrim*** NOT Atrium
Last edited by jellytime on Nov 27th, 2018 1:02 am, edited 1 time in total.