Mortgage Company of Canada
Founded in 2013, Mortgage Company of Canada has grown to a diversified portfolio, secured primarily by residential properties across the Greater Toronto Area. Through Mortgage Company of Canada, investors looking for an alternative investment class have the opportunity to participate in an attractive portfolio of professionally managed, high-yielding Canadian mortgages.
In Ontario, the mortgage administering industry is regulated by the Financial Services Commission of Ontario (FSCO), an arms-length agency of the Ministry of Finance. All mortgage brokerages, administrators, brokers, and agents need to be licensed with FSCO to conduct mortgage brokering business in Ontario.
More information on FSCO and the mortgage brokering industry can be found on FSCO’s web site.
Mortgage Company of Canada is administered by Oppono Lending Company, a licensed mortgage administrator with FSCO.
Your privacy is important, and we are committed to respecting your privacy through the protection of any personal information given to us when you invest with us or apply for a loan from us.
What is a MIC?
Mortgage Investment Corporations (“MICs”) are special entities allowed under Section 130.1 of the Canadian Income Tax Act (the “Act”). MICs allow individuals to pool their funds and invest this capital in mortgage loans, benefitting from the risk mitigation provided by a large, diversified portfolio. The Act requires that 100% of a MIC’s annual net income, as verified by external audit, be distributed to its shareholders by way of dividends. These dividends are taxed as interest income in the investors’ hands and essentially represent a flow-through of the interest earned by the MIC’s mortgage portfolio. These dividends can be taken in cash or re-invested in new shares of the MIC in accordance with its dividend reinvestment policy. In exchange for an administration fee, a professional management company performs the day-to-day administration of the portfolio.
Why Mortgage Investment Corporations Were Created
Investing in private mortgages can provide investors with a stable source of income. However, participating in the private mortgage market as an individual investor can be complicated, and may present a number of obstacles. First, due to their average size, sourcing and issuing, residential mortgages presents a barrier to entry for many investors. Second, mortgage investing requires strong underwriting skills, as well as effective mortgage administration experience. In the event that an investor is capable of sourcing and properly administering the loan, their rate of return is reduced if they cannot reinvest mortgage payments and payouts quickly and efficiently. Lastly, investing in mortgages typically requires large amounts of capital to build a diversified portfolio to effectively mitigate risk. The MIC structure facilitates investment in this attractive asset class by significantly reducing barriers to entry and mitigating risk.
The Benefits of Investing in a MIC:
- Security – Mortgages purchased by the MIC are secured by real assets.
- Deferred Income Plans – Investment in a MIC is considered a qualified investment and can be held in a number of registered savings plans (RRSP, RRIF, TFSA, RESP, and deferred profit sharing plans).
- Diversification – Investors own shares of a diversified portfolio of mortgage loans, thereby mitigating risk.
- Regular Income – Investors can choose to take their dividends in cash or re-invest them into additional shares in accordance with the MIC’s Dividend Re-Investment Plan.
The Benefits of Investing in Mortgage Company of Canada:
- Professional Management – Mortgage Company of Canada’s management team has been in the mortgage lending, brokering and real estate development business collectively for over 40 years.
- Niche Market Focus – Primarily lending in residential communities in the Greater Toronto Area where residential real estate demand exceeds supply.22`
- Conservative Valuations – Mortgage Company of Canada lends at a discount to appraised values determined by third-party best-in-class appraisal companies.
- Disciplined Approach to Lending – Insulating against housing price drops by limiting Loan-to-Value (“LTV”) ratio to 80% or less.
- Risk Mitigation through Portfolio Diversification – Creating portfolio diversification by providing a high volume of small value loans.
- Liquidity – Investing in short-duration loans (average loan duration is 12 months).
- Affiliated Mortgage Brokerage Arm– Affiliated 13-year-old mortgage brokerage ensures a high-volume of potential investment opportunities.
Mortgage Company of Canada’s objective is to focus on investing primarily in a portfolio of conventional first and second mortgage loans that generate income to allow Mortgage Company of Canada to pay monthly dividends to its shareholders.
In order to achieve this objective while mitigating the portfolio’s overall exposure to risk, Mortgage Company of Canada’s investment activities are governed by a strict set of underwriting criteria based on a credit policy framework established by the Board of Directors.
Mortgage Company of Canada’s mortgage portfolio at a glance:
- The portfoliThe portfolio is diversified amongst over 571 mortgages with a mix of investment types.
- Management continually monitors concentration risk, with no one loan exceeding $1,750,000 million of the total portfolio.
- The MIC invests in a number of different communities primarily in Toronto and the Greater Toronto Area, providing geographic diversification with limited exposure in the more speculative markets.
- The portfolio is composed of a mix of first and second residential mortgages. In 2018, the portfolio has experienced an average weighting of 64% first residential mortgages and 36% second residential mortgages in terms of dollars funded.
- Based on conservative third-party appraisals obtained at the time of funding, the Loan-to-Value (“LTV”) ratio of the portfolio is approximately 68%.
- Mortgage Company of Canada is invested in a number of different communities, providing geographic diversification with limited exposure in the more speculative markets. The balanced markets we invest in have not experienced significant upswings and should avoid the rapid declines that often follow.
- In 2018 Mortgage Company of Canada’s average loan size is approximately $270,000, as compared with other mortgage investment corporations, which average in the millions.
- Mortgage Company of Canada typically makes investments with terms of 12 months, with the average term to maturity within the portfolio historically being approximately 5.4 months, providing a high level of liquidity to the mortgage portfolio.
Please email [email protected], our customer service group or contact them at 905-886-5352 or 1-866-318-7222 for inquiries regarding customer service matters.
In order to most efficiently address your concern, please include your mortgage number and property address in any correspondence.
Our mortgage administration department is available Monday to Friday, 8:30 a.m. to 5:00 p.m., excluding holidays.
If you need to increase or refinance your mortgage, please contact your mortgage broker.
How to Borrow
Mortgage Company of Canada must accept all applications for mortgages via licensed mortgage brokers. We are unable to accept direct applications.
To find a licensed mortgage broker, visit:
CAAMP, the Canadian Association of Accredited Mortgage Professionals
FSCO, the Financial Services Commission of Ontario
What We Do
Mortgage Company of Canada is best described as a non-traditional mortgage lender. As such, we understand the frustrations brokers often encounter when dealing with traditional lenders and institutions. Our structure removes the red tape from the approval process and provides fast funding to the borrower.
Our in-depth knowledge of the mortgage industry allows us to generate approvals, typically within 24 hours. We understand that customers can be complicated with unique and unusual factors to be considered during the mortgage review process. Our common sense approach to lending does not adhere to a rigid underwriting matrix, but rather considers other important factors like borrowers’ repayment patterns, and loan to value ratios. By looking at the entire story, we are able to help prospective quality borrowers with a less than perfect credit rating secure the loan they need. In other words, if the investment makes sense, we will fund it.
Once the signed commitment letter has been returned, our team of underwriting administrators work with the broker and agent to ensure that the necessary documentation is received as quickly as possible to provide timely funding of the mortgage.
Our Part of the Commitment:
- Our turn-around time is 24 hours. We commit to sending you an approval, decline, or contact from an underwriter regarding the application status.
- We are available during our business hours which are 8:30 AM to 5:00 PM (Eastern) Monday to Friday.
- We will do our best to respond to your phone messages within 3 hours of receipt.
- Our underwriters have individual extension numbers to help speed up transactions and save valuable time.
- Our dedicated team leads will handle any issues or concerns through our escalation process.
Your Part of the Commitment:
- Disclose as much information as possible on the application, including your direct contact information.
- Review the commitment conditions with your clients so they know up front what they need to provide.
- Follow-up aggressively with your client to get the commitment signed and returned to us.
- Commit your client to the deal by collecting as much documentation up front as you possibly can and reviewing all documents that you receive from your client.
- Obtain, where possible, all the documentation at one time so you can do one review and send it to us as a package.
- Provide the name and contact information of the client’s lawyer to expedite our instruction process and help commit the client to you.
- We pay out all arrears, arrears do affect the interest rate and lender fee, please ensure full disclosure at the time of submission.
675 Cochrane Drive,
Suite 104, West Tower,
Markham, ON, L3R 0B8
URL : www.mcoci.com