In This Article What Is a Mortgage Investment Corporation? How MIC Lending Differs From Individual Private Lending Advantages of MIC Mortgages for Borrowers Lower Rates More Predictable Terms Higher Renewal Probability Professional Management Larger Loan Amounts How to Qualify for a MIC Mortgage Property Assessment Borrower Assessment What MICs Don't Usually Require Types of MICs Operating in Ontario Exploring MIC Mortgage Options? Small MICs ($5M–$50M portfolio) Mid-Size MICs ($50M–$200M portfolio) Large MICs ($200M+ portfolio) MIC Fees and Costs Example: $250,000 MIC First Mortgage MIC Risks and Considerations Renewal Is Not Guaranteed Less Flexible Than Individual Lenders Prepayment Terms Vary How to Find a Reputable MIC Through Your Mortgage Broker Due Diligence Questions MICs for Investors: The Other Side Frequently Asked Questions Find the Right MIC for Your Situation Table of Contents If you're exploring private mortgage options in Ontario, you'll encounter two main lender types: individual investors and Mortgage Investment Corporations (MICs). Understanding how MICs work helps you make a more informed choice — and in many cases, MICs offer better terms than individual private lenders. What Is a Mortgage Investment Corporation? A MIC is a pooled investment fund that collects capital from multiple investors and uses it to fund mortgage loans. Think of it as a private mortgage mutual fund: Investors buy shares in the MIC, earning returns from mortgage interest Borrowers receive mortgage funding from the MIC's pooled capital The MIC manages underwriting, collections, and investor distributions MICs are created under Section 130.1 of the Income Tax Act and must meet specific requirements: At least 50% of assets must be residential mortgages At least 20 shareholders No single shareholder can own more than 25% Must distribute all net income to shareholders How MIC Lending Differs From Individual Private Lending Individual Private Lender Capital source Pooled investor fund Single person's capital Lending capacity $5M–$500M+ portfolio Usually $500K–$5M Rate range 8–12% 10–15% Decision-making Committee/criteria-based Individual judgment Underwriting Standardized process Varies widely Renewal reliability High (institutional) Variable (personal decision) Speed 1–2 weeks Days to 1 week Flexibility Moderate (policies) High (negotiable) Regulation FSRA + Ontario Securities Commission FSRA (via broker only) Maximum loan $1M–$10M+ Usually under $2M Advantages of MIC Mortgages for Borrowers Lower Rates MICs typically charge 8–12% vs individual lenders' 10–15%. The difference: MICs achieve economies of scale and their investors accept slightly lower returns in exchange for portfolio diversification and professional management. On a $300,000 mortgage: MIC at 9%: $27,000/year in interest Individual at 12%: $36,000/year in interest Annual savings: $9,000 More Predictable Terms MICs have established lending criteria. You know what to expect: Published rate ranges Standard fee structures Clear qualification guidelines Documented renewal policies Individual lenders can change terms or decide not to renew based on personal circumstances — they might need their capital back for their own reasons. Higher Renewal Probability MICs are in the business of lending. As long as your account is in good standing and the property maintains value, renewal is likely. Individual lenders may not renew because: They need the money for something else They changed their mind about risk Personal financial circumstances changed They found a better investment opportunity Professional Management MICs employ professional underwriters, lawyers, and portfolio managers. This means: Proper documentation and contracts Clear communication channels Structured collections process if issues arise Regulatory compliance Larger Loan Amounts MICs with substantial portfolios can fund larger mortgages than individual investors. If you need $500,000+ in private financing, a MIC is often the only realistic option. How to Qualify for a MIC Mortgage MIC qualification is more structured than individual private lending but still far more flexible than bank financing: Property Assessment Independent appraisal required Maximum LTV typically 75% (some go to 80%) Property must be in acceptable condition Location within their lending area (most Ontario MICs focus on GTA+) Borrower Assessment Basic identification and background Current mortgage statement(s) Brief explanation of financing need Exit strategy (how you'll refinance out) Property insurance confirmation What MICs Don't Usually Require Minimum credit score Detailed income verification Debt ratio calculations Stress test qualification Types of MICs Operating in Ontario Exploring MIC Mortgage Options? Get connected with Ontario's top MIC lenders through an experienced broker. Get MIC Rate Quotes Small MICs ($5M–$50M portfolio) Often locally focused More flexible on property types May offer slightly higher rates Faster decision-making More personal service Mid-Size MICs ($50M–$200M portfolio) Regional coverage (Ontario-wide) Competitive rates Established track records Good balance of speed and pricing Large MICs ($200M+ portfolio) Provincial or national coverage Most competitive rates Longest track records Most rigorous underwriting May be slower to approve Your mortgage broker will recommend MICs based on your specific situation. The "best" MIC depends on your property, loan size, and timeline. MIC Fees and Costs MIC fees are typically lower than individual private lending: Individual Typical Lender fee 1–2% 2–3% Broker fee 1–1.5% 1–2% Legal (borrower side) $1,500–$2,000 $1,500–$2,500 Legal (lender side) $800–$1,200 $1,000–$1,500 Appraisal $350–$500 $350–$500 Total upfront 3–5% + legal 4–7% + legal Example: $250,000 MIC First Mortgage Amount Lender fee (1.5%) $3,750 Broker fee (1%) $2,500 Legal (your side) $1,800 Legal (lender side) $1,000 Appraisal $450 Title insurance $300 Total upfront $9,800 Annual interest at 9% $22,500 12-month total cost $32,300 Effective annual rate including fees: approximately 13%. MIC Risks and Considerations Renewal Is Not Guaranteed While more likely than with individual lenders, MIC renewal isn't automatic: Property value decreases may affect renewal Significant payment arrears could trigger non-renewal MIC policy changes may affect criteria Less Flexible Than Individual Lenders MICs follow policies. If your situation is unusual: Rural properties may not fit their criteria Very small or very large loans may be outside their range Unique property types may be declined Prepayment Terms Vary Some MICs are fully open (no penalty for early payoff). Others charge 1–3 months' interest. Confirm before committing — you want the ability to refinance to institutional lending without penalty. How to Find a Reputable MIC Through Your Mortgage Broker Licensed mortgage brokers maintain relationships with multiple MICs. A good broker: Knows which MICs suit your property type and location Has volume-based relationships for better pricing Can compare multiple MIC offers Understands each MIC's underwriting preferences Due Diligence Questions Ask about any MIC through your broker: How long have they been operating? What's their portfolio size and default rate? Are they registered with the Ontario Securities Commission? What are their renewal policies? What happens if I need to prepay? Compare MIC rates vs individual lender rates MICs for Investors: The Other Side While this article focuses on borrowing from MICs, it's worth noting that MICs also serve as investment vehicles: Returns typically 6–10% annually Income distributed as dividends (not capital gains) RRSP/TFSA eligible in most cases Portfolio diversified across many mortgages If you're a real estate investor, MICs offer exposure to mortgage lending without the complexity of originating individual deals. Ready to Get Started? Contact us today for personalized mortgage advice and competitive rates. Get Pre-Approved Call (416) 822-7357 Frequently Asked Questions What Is a Mortgage Investment Corporation? A MIC is a pooled investment fund that collects capital from multiple investors and uses it to fund mortgage loans. Think of it as a private mortgage mutual fund: Investors buy shares in the MIC, earning returns from mortgage interest Borrowers receive mortgage funding from the MIC's pooled capital The MIC manages underwriting, collections, and investor distributions MICs are created under Section 130. Exploring MIC Mortgage Options? Get connected with Ontario's top MIC lenders through an experienced broker. Get MIC Rate Quotes Are MIC mortgages regulated in Ontario? Yes. MICs are regulated by both FSRA (for mortgage activities) and the Ontario Securities Commission (for their investment structure). This dual regulation provides stronger consumer protection than individual private lending. Can I get a MIC mortgage for a rental property? Yes. Many MICs actively fund investment properties. Rates may be slightly higher than owner-occupied, and LTV limits may be lower (65–70%). How fast can a MIC fund a mortgage? Typically 1–2 weeks from application to funding. This is faster than banks but slower than individual private lenders who can sometimes close in days. What's the minimum MIC mortgage amount? Most MICs have minimums of $50,000–$100,000. For very small loans, individual private lenders may be the better fit. Do MIC payments get reported to credit bureaus? It depends on the MIC. Some report to Equifax or TransUnion, others don't. If credit rebuilding is part of your plan, ask your broker to find a MIC that reports payments. Can I negotiate MIC rates? Somewhat. MICs have published rate ranges, but your broker can negotiate based on LTV, property quality, and overall file strength. There's less flexibility than with individual lenders but some room for discussion. Back to complete Ontario private mortgage guide Find the Right MIC for Your Situation A licensed broker with MIC relationships can match you to the best option. Compare MIC Options
