Mortgage Investment Corporation (MIC)

 

Safe Investment Growth

Happens With Care & Expertise

What is MIC?

In 1970’s Mortgage Investment Corporations, or MICs, were created to make mortgage investing easy. Abana MIC or AMIC allows individual investors to pool their funds to invest in a diversified portfolio of residential and commercial mortgages loans.

Benefits of Investing in MIC

  • Real Estate Security
  • Regular Income
  • RRSP / RRIF Eligible
  • Tax Sheltering

Why Abana MIC?

  • Management
  • Diversification
  • Reinvestment
  • Experience

How MIC Works

Purchasing Shares
Investors buy preferred number and classes of shares in the mortgage investment corporation through a subscription agreement and offering memorandum (OM) for a specific fund.

Corporate Audit
At the end of every fiscal year, the AMIC is audited by Smythe LLP as an independent accounting firm, the result of audits is made available to every investor in the form of audited financial statement.

MIC Management

MIC Manger will conduct marketing, sources borrowers and issues short term mortgages to qualified applicants and secures the investment.

Abana Capital Inc manages the day to day operation and administration of the portfolio. This includes: receipt and posting of mortgage payments, funding new mortgages, renewal of existing mortgage loans while collaborating with underwriter and maintains amortization schedules and bank records for the portfolio.

Dividends

As interest payments are received from the borrowers, dividends are paid out to the investors. These dividends can be taken in cash or re-invested in new shares. Overhead and management fees are mostly covered through fees paid by the borrowers. MIC operations is ‘revenue neutral’ and all profits, net of overhead and management, must be distributed to the shareholders at the end of each fiscal year.

Credit Committee

MIC Management reviews the incoming applications with strict due diligence and based on industry benchmarks and underwriting processes to recommend only qualified applications to the MIC credit committee. The committee includes major shareholders form the MIC along with independent members of the board of directors.

INTERESTED TO INVEST IN MIC?

Fund Details

Investment Objectives

The Fundamental objective of the Fund is to provide a steady stream of interest income by investing in a diversified portfolio of residential second and construction mortgages. The capital will be invested in mortgages located in major metropolitan areas in Lower Mainland with a loan to Value (LTV) not to exceed 75% of appraised value.

Who Should Invest In MIC

If you are seeking:

  • High-quality investment in Real Estate
  • Regular income stream
  • Alternative to traditional Real Estate Investment
  • More secure investment

Investment Strategy

Target asset allocation is 75% in residential 2nd mortgages and 25% percent in construction mortgages. The Fund will not maintain a cash position and will remain fully invested except in times of scheduled dividend distributions.

Asset Allocation

RESIDENTIAL 2ND MORTGAGES

CONSTRUCTION MORTGAGE

Lending Area

The Fund will focus on lending in major centres of British Columbia with specific focus on North and West Vancouver.

Tax Benefits

  • Investments can be made through registered RRSP/RESP or TFSA accounts directly.
  • Dividends are treated as interest income.
  • Dividends are not subject to corporate tax on the fund level, allowing flexibility for individual tax planning.

Distribution Policy

The fund distributes dividends on quarterly basis. Shareholders may choose to take their dividend in cash or reinvest in additional shares.

Redemption

To achieve the investment objectives outlined above, the Fund Manager must be fully invested and maintain a low cash position except in times of scheduled dividend distributions. Investors may redeem with 90-day notice after first year of funds operation and purchase shares whenever they wish, subject to the Funds cash position at the time.

INTERESTED TO INVEST IN MIC?