When it comes to finding some of the best real estate investments in Canada, many investors are turning to an often-overlooked vehicle: the Mortgage Investment Corporation (MIC). Alternative fixed-income investments such as MICs are becoming more popular because of their sustained returns year over year. MICs offer a powerful way to access real estate-backed income without the hassle of owning or managing properties directly.
In this guide, we’ll explain MICs, how they work, and why they’re gaining popularity among investors seeking consistent returns and portfolio diversification. Whether you’re new to real estate investing or looking to complement your existing portfolio, understanding MICs can open the door to smarter, income-generating opportunities. We’ve gathered our top 9 most commonly asked questions about MICs to help inform you and hopefully shed some light on what a MIC is and how it could help ad variation to your existing investments.
A Mortgage Investment Corporation (MIC) is an investment and lending company that pools capital from investors and lends it out as secured mortgages, typically on residential, construction, and commercial property mortgage loans. MICs operate under Section 130.1 of the Canadian Income Tax Act. They are designed to flow virtually all of their income back to shareholders, avoiding corporate income tax. Because shares of an MIC are qualified investments, they are eligible to be held in RRSPs, RRIFs, TFSAs, RESPs and RDSPs. Owning shares in an MIC enables you to invest in a company that manages a diversified and secure pool of mortgages.
MICs are generally provincially registered and licensed, with the management of the mortgage fund under the direction of a provincially licensed mortgage broker. Mortgages are secured on real property, often in conjunction with other forms of security such as personal and corporate guarantees, general security agreements, and material contracts.
Think of MICs as a form of real estate investment banking. They give you access to mortgage lending deals without needing to become a lender yourself or own a physical property with all of the additional expenses and work that entails.
Investors contribute funds into a MIC at a price of $1 per share. A minimum investment of $5000 is required, and this is invested for one year. If repayment is not requested, your investment is reinvested for an additional year. Income earned in the MIC is paid as interest income to the investor on either a monthly or quarterly basis, depending on the MIC chosen.
The corporation then uses the invested capital to provide borrowers with short- to medium-term mortgages. Borrowers might include:
Real estate developers
Homeowners in need of short-term bridge loans
Business owners seeking capital for growth
Commercial property buyers looking for flexible commercial mortgage loans
In return, MICs collect interest on the mortgages, which is passed back to investors in the form of monthly or quarterly dividends. These are typically classified as interest income, and MICs must distribute 100% of their net income to shareholders annually.
Many MICs focus on lending in urban or fast-growing areas in Canada, giving investors exposure to stable, asset-backed returns in the Canadian real estate market.
Cooper Pacific currently offers three different MIC funds. The MIC funds are based on a diversified pool of first and second short-term construction and interim loans to builders and developers in Greater Victoria, Vancouver Island, Greater Vancouver, and Alberta. Investor income can be received in the form of cash, or it can be reinvested as additional shares in the MIC in order to obtain compounded investment returns.
Investing in a MIC offers several advantages, especially for Canadians looking for alternative investments to stocks and bonds:
Regular Income: MICs typically offer consistent monthly distributions.
Portfolio Diversification: Diversification is why you should invest in an MIC. Private MICs are not correlated to public markets. Therefore, MICs reduce the volatility of your portfolio without compromising your yield.
Capital Preservation: Loans are secured against real estate assets, often at conservative loan-to-value ratios.
Registered Account Eligible: You can invest through RRSPs, TFSAs, RESPs, and RRIFs.
Professional Management: Managed by experts in lending, underwriting, and risk mitigation.
MIC investments are considered passive investments; you simply invest and start earning returns as either cash or shares. Cooper Pacific RRSP, RRIF, and TFSA investment plans carry no annual fees, transaction fees, or plan transfer fees that tend to reduce your investment returns.
MICs may be a strong fit for:
Retirees looking for predictable income
Busy professionals seeking passive returns
Investors looking to diversify away from equities
Real estate investment groups interested in broad exposure to Canada’s mortgage market
Those looking for RRSP/TFSA-compatible investments
Because MICs generate income through mortgage interest rather than property appreciation, they’re particularly attractive to those with lower risk tolerance or income needs.
When evaluating a Mortgage Investment Corporation, it’s important to look beyond just projected returns. The quality of the management team, their track record, and the strategy behind the fund matter just as much. A MIC with experienced leadership and a history of success in real estate lending is more likely to deliver consistent, secure performance.
Risk management is also key. Look for MICs that lend on mortgages secured by real property, ideally with conservative loan-to-value ratios. A diversified pool of loans—ranging from residential to commercial, across various regions—helps reduce concentration risk and market exposure.
Transparency is another important factor. Strong MICs will provide regular updates, detailed performance reports, and open communication with investors. You should also consider the fund’s liquidity—while MICs are not as liquid as stocks, some offer annual redemption options or reinvestment plans that align with your financial goals.
Cooper Pacific primarily invests in first and second-mortgage loans on short-term loans. These typically include construction loans for subdivisions, single-family homes, condo developments, townhouses, and select commercial projects. These make up the majority of the projects we lend on. However, we also lend on land purchases, holding properties, and occasionally income-generating commercial buildings. This broad range allows us to maintain a balanced, secure mortgage pool.
Deals with experienced borrowers and developers in stable real estate locations are the major comfort factors in determining which loans are right for Cooper Pacific. We have numerous relationships with well-established borrowers with good track records in locations that are in major urban centres. Every mortgage Cooper Pacific funds must be unanimously approved by our credit committee, which comprises a minimum of two directors, but more often, three are present.
Borrowers like our very quick service and the fact that our process is devoid of the bureaucracy that sometimes plagues institutional lenders. A borrower can bring a deal to us, and we can have it approved and funded within a couple of days.
Cooper Pacific has over 22 years of experience providing customized lending products to borrowers and a proven track record of maximizing investors’ returns.
Investors benefit from a knowledgeable management team with a strong reputation for honesty, reliability, and integrity in business. This team is supported by one of the strongest, most respected Boards of Directors in the real estate industry. Cooper Pacific prides itself on its dedicated commitment to ensuring quality service to both investors and borrowers. As a local MIC, we can be nimble and flexible in the marketplace, adapting quickly to changes in the real estate market.
If you’re ready to learn more about how MICs work—and whether they’re right for your portfolio—our team at Cooper Pacific is here to help. Get in touch with Jordan on our team today. With decades of experience managing mortgage funds, we provide clarity, security, and opportunity in every investment.
821 Broughton St. Victoria BC, V8W 1E5
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Since 1994, Cooper Pacific Mortgage Investment Corporation has been helping communities and investors across Western Canada grow and prosper. As real estate experts, our goal is to offer investors outstanding mortgage investment opportunities with an attractive rate of return. We do this by offering short-term construction financing and interim mortgage funding to help builders and developers take projects from planning to completion.
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