What is a MIC?
A Mortgage Investment Corporation (MIC) pools capital from multiple investors (like you) to lend to property owners, focusing on residential and commercial mortgages.
You own a share in this pool and collect dividend returns (usually quarterly) that can change based on the corporation's overall performance and be diluted by management and admin fees.
MICs pay dividends
MICs are legally required to distribute 100% of their net income to shareholders, making them a popular choice for those seeking consistent income.
No direct control
However, while investors in MICs can benefit from a diversified portfolio and passive income, they have no direct control over which specific mortgages their capital is allocated to, making it a more hands-off investment.
Return volatility
MICs often invest in higher-risk private mortgage loans, which can lead to return volatility due to greater exposure to borrower defaults and market conditions.
Don't MICs offer monthly dividends, too?
Yes, some MICs offer monthly dividends. However, monthly MICs may incur higher administrative costs (due to more frequent calculations and distributions) that may be passed on to investors, resulting in slightly lower net returns compared to quarterly dividend MICs.
Also, MICs paying monthly dividends may need to maintain higher liquidity to cover more frequent payouts, which can affect their ability to reinvest capital and impact their long-term growth or return potential.
How are we an alternative to MICs?
A direct-investment business model
The qualified, syndicated mortgages on the Morcado™ platform are individually stringently curated and offered for your individual investment.
This business model is substantially different from MICs, in that you become the 'lender,' taking over an amount of a borrower's mortgage loan to claim a percentage of the interest payment as your return on your investment.
Fixed, monthly returns
Already part of the mortgage 'flora' (with monthly mortgage payments the standard), this frequency doesn't impact your return potential, now or later.
Your returns are fixed based on the rate and term of mortgages selected and can't be watered down. Morcado doesn't offer high-risk private mortgages that come with a greater risk of default.
Simple, transparent fee structure
Morcado manages the mortgage processes on your behalf (mortgage origination, underwriting, and administration) — while offering attractive rates and a simple fee structure that provides transparency on exactly what your returns will be (read about inherent mortgage risks here).
Key benefits of Morcado's mortgage investment platform:
- Potential for higher returns. High-yield mortgages offer better rates than traditional mortgages.
- Net return rates. The rates you select are the rates you get.
- Passive, monthly income. Return amounts are typically set for the duration of the mortgage and deposited into your account of choice.
- Self-directed investment. Choose your mortgages and get easy access to account details.
- Transparency. Know exactly where your money goes and what you'll receive in return.
- Diversify your portfolio. Investing across multiple properties offers reduced risk and balanced returns.
In other words, you make bank, like a bank — growing wealth through a simple investment experience.
Have questions or want to get started? Book with your Mortgage Investment Advisor today.
