Mortgage Investment Entities (MIEs) in Canada
What You Should Know
- A Mortgage Investment Entity (MIE) pools investor capital and lends it as mortgages secured by real estate. It can be structured as a corporation, trust, or limited partnership.
- A Mortgage Investment Corporation (MIC) is a specific type of MIE defined under the Income Tax Act that pays no corporate tax and passes all income to investors as interest.
- Returns typically range from 5% to 12%+ annually, depending on risk. Higher advertised yields signal higher credit risk, and returns are not guaranteed.
- Most MIEs are illiquid. Unlike GICs or savings accounts, they are not CDIC-insured, and investors may lose some or all of their capital.
What Is a Mortgage Investment Entity (MIE) in Canada?
A Mortgage Investment Entity (MIE) is a broad term used in Canada to describe an investment vehicle that pools capital from investors and uses those funds to lend money secured by Canadian real estate. MIEs operate as private or alternative lenders and are commonly used to finance borrowers who do not qualify for traditional bank mortgages.
An MIE can be structured as:
- A corporation (public or private)
- A trust
- A limited partnership
Mortgage Investment Entities in Canada
Note: Data is based on publicly available information and fund disclosures. Returns, LTV, and terms may vary by share class or offering. WOWA does not guarantee the accuracy, completeness, or currency of the information in this table. Figures change frequently and may already be out of date by the time you read this. Verify all details directly with each fund or its dealer before making any investment decision. Nothing in this table constitutes investment advice.
List of Mortgage Investment Entities in Canada
For informational purposes only. Data and estimates are not guaranteed and may be subject to errors, revisions, or changes without notice.
to see additional fund data, including LTV, fees, structure, and more.
| NameTo view a fund's page, click its name. | Assets Under Management | Return 2023 | Return 2024 | Return 2025 | Loan-to-Value (LTV) | Management Fee | Structure | First Mortgage | Data As Of |
| TD Greystone Mortgage Fund | $11B CAD | 6.57% | 6.2% | 5.62% | – | – | Trust (Open-end pooled fund) | 100% | December 31, 2025 |
| MCAN Mortgage Corporation | $8.3B CAD | 20% | 24.7% | 32.7% | 67.4% | – | Public Corporation | Predominantly | March 31, 2026 |
| PH&N Mortgage Pension Trust | $5.1B CAD | 7.2% | 6.4% | 5% | 49% | – | Pooled fund trust (institutional) | 100% | May 31, 2026 |
| ACM Commercial Mortgage Fund | $5.0B CAD | 6.85% | 6.83% | 5.15% | 65.3% | 0.6% | Trust | 93% | June 30, 2026 |
| Addenda Commercial Mortgages Pooled Fund | $3.8B CAD | 7.15% | 7.14% | 5.45% | – | – | Trust | 100% | March 31, 2026 |
| Romspen Mortgage Investment Fund (RMIF) | $2.3B CAD | -0.3% | 0% | -6.2% | 65% | 1% | Trust | 94% | March 31, 2026 |
| KingSett High Yield Fund | $1.8B CAD | – | – | – | – | – | Partnership | – | June 30, 2026 |
| KingSett Senior Mortgage Fund | $1.7B CAD | – | – | – | – | – | Partnership (open-ended LP) | 100% | June 30, 2026 |
| Scotia Mortgage Income Fund | $1.6B CAD | 3% | 6.4% | 2.8% | – | 1.46% | Trust | 100% | April 30, 2026 |
| IG Mackenzie Mortgage and Short Term Income Fund | $1.6B CAD | 5.5% | 6.4% | 4.2% | – | 0.44% | Open-ended mutual fund trust | – | March 31, 2026 |
| Timbercreek Financial | $1.2B CAD | 10% | 16.4% | 6.5% | 66.5% | 0.85% | Public Corporation | 94.7% | March 31, 2026 |
| First Mortgage LP (FMLP) | $1.2B CAD | – | – | – | – | – | Ontario limited partnership | Primarily | September 5, 2024 |
| Mortgage Company of Canada Inc. (MCOCI) | $1.2B CAD | – | – | – | – | – | Private Corporation (MIC) | Primarily | September 5, 2024 |
| Trez Capital Yield Trust U.S. | $1.2B CAD | 8.9% | 8.7% | -1.5% | 66.8% | 1.5% | Trust | 75.6% | March 31, 2026 |
| Amur Capital Income Fund | $1.1B CAD | 11.08% | 11.71% | 10.65% | 55% | 2% | Private Corporation (MIC) | 44.5% | March 31, 2026 |
| Nicola Canadian Mortgage Fund | $1.0B CAD | 8% | 8.2% | 6.7% | 68.9% | – | Trust | 80% | April 30, 2026 |
| Antrim Balanced Mortgage Fund | $922M CAD | 6.36% | 7.64% | 9.08% | 60% | 1% | Private Corporation (MIC) | 85% | October 24, 2025 |
| Atrium Mortgage Investment Corporation | $896M CAD | 10.2% | 12.3% | 14.7% | 61.4% | 0.85% | TSX-Listed Public Corporation (MIC) | 95.3% | March 31, 2026 |
| Canada Life Mortgage Fund — London Life Legacy Pool | $818M CAD | 2.5% | 4.39% | 2.61% | – | 0.9% | Segregated Fund (Individual Variable Insurance Contract) | – | December 31, 2025 |
| Timbercreek Real Estate Debt – U.S. Fund | $800M CAD | – | – | – | – | – | Trust | – | December 11, 2024 |
| Trez Capital Yield Trust | $785M CAD | 7.7% | 7.7% | -12.5% | 70.6% | 1.5% | Trust | 76.2% | March 31, 2026 |
| MortEq Lending Corp | $768M CAD | 9.15% | 10.28% | 9.22% | 52.9% | 1.5% | Private Corporation (MIC) | 88.9% | May 31, 2026 |
| Romspen U.S. Mortgage Investment Fund | $753M CAD | 7.8% | 7.2% | 5.8% | 65% | 1.25% | Partnership (LP) | 100% | March 31, 2026 |
| VWR Capital Corp. | $752M CAD | 7.95% | 10.19% | 10.35% | 62.5% | 1.4% | Private Corporation (MIC) | 78.4% | November 1, 2025 |
| Capital Direct I Income Trust | $683M CAD | 8.91% | 10.13% | 10.23% | 55.6% | 1% | Open-Ended Investment Trust | 68% | March 31, 2026 |
| PH&N Short Term Bond & Mortgage Fund | $607M CAD | – | – | – | – | 0.49% | Trust (open-ended mutual fund) | 100% | June 26, 2025 |
| Fiera Canadian Real Estate Debt Fund L.P. | $595M CAD | 9.37% | 5.63% | 6.91% | – | – | Open-ended limited partnership | 70.7% | March 31, 2026 |
| Firm Capital Mortgage Investment Corporation | $573M CAD | 10.7% | 19.3% | 6.9% | 55% | – | TSX-Listed Public Corporation (MIC) | 94.9% | March 31, 2026 |
| Westboro Mortgage Investment Fund | $566M CAD | 9.8% | 10.3% | 9.4% | 64.1% | 2% | Private Corporation (MIC) | 92.9% | June 30, 2026 |
| ACM Mortgage Fund Two | $550M CAD | – | – | – | – | – | Trust | – | June 30, 2026 |
| Peakhill Income Opportunity LP | $534M CAD | 11.09% | 10.06% | 9.38% | 70% | – | Open-ended limited partnership | – | December 31, 2025 |
| SLC Management Canadian Commercial Mortgage Fund | $526M CAD | – | – | – | – | – | Institutional Pooled Fund | Primarily first mortgages | June 30, 2022 |
| Neighbourhood Holdings Income Trust I (NHIT) | $484M CAD | 8.9% | 8.54% | 7.99% | 52.1% | 0.75% | Open-ended investment trust | 98% | March 31, 2026 |
| KV Mortgage Fund | $461M CAD | 8.22% | 8.84% | 8.67% | 62.5% | 1% | Open-Ended Corporation (MIC) | 82% | June 1, 2026 |
| Magenta Mortgage Investment Corporation | $459M CAD | 7.91% | 8.6% | 7.58% | 69.4% | – | Private Corporation (MIC) | 89.3% | May 31, 2026 |
| Cambridge Mortgage Investment Corporation | $443M CAD | 9.55% | 10.73% | 9% | 52.5% | 1.5% | Private Corporation (MIC) | 79.4% | March 31, 2026 |
| Calvert Home Mortgage Investment Corp (CHMIC) | $357M CAD | 10.76% | 10.36% | 10.85% | 64% | – | Open-Ended Private Corporation (MIC) | 94% | May 31, 2026 |
| Vector Mortgage Trust | $355M CAD | – | – | – | 53.7% | – | Open-Ended Investment Trust | 100% | February 28, 2023 |
| Bay Street High Yield Mortgage Fund (BSHY) | $350M CAD | – | – | – | – | – | Partnership | – | June 30, 2026 |
| Canguard Mortgage Investment Corporation | $319M CAD | 10.7% | 10.73% | 9.48% | 52.3% | 1.5% | Open-Ended Private Corporation (MIC) | 92% | March 31, 2026 |
| Fisgard Capital Corporation | $310M CAD | 7.39% | 8.63% | 7.33% | 55.4% | 2% | Private Corporation (MIC) | 97% | March 31, 2026 |
| AWM Diversified MIC | $295M CAD | 8.07% | 8.67% | 8.97% | 67% | 2% | Private Corporation (MIC) | 74% | March 31, 2026 |
| AP Capital Mortgage Fund | $285M CAD | 8.36% | 9.02% | 8.33% | 59% | 1.5% | Private Corporation (MIC) | 78.7% | May 30, 2026 |
| Three Point Capital Corp. | $280M CAD | 8.13% | 9.68% | 8.9% | 56.1% | 1.5% | Private Corporation (MIC) | 92% | March 31, 2026 |
| Capstone Mortgage Pool | $273M CAD | – | – | – | – | 1% | Trust | – | June 30, 2026 |
| Clifton Blake Mortgage Income Fund Trust | $261M CAD | 9.75% | 9.48% | 8.78% | 54.7% | 1% | Trust | 88.6% | December 31, 2025 |
| CMLS Mortgage Fund | $257M CAD | 7.56% | 8.24% | 7.06% | 62.5% | 1% | Trust | 69% | March 31, 2026 |
| Pacifica Mortgage Investment Corporation | $253M CAD | 9.78% | 10.02% | 8.32% | 53.3% | 2% | Private Corporation (MIC) | 82.7% | February 28, 2026 |
| Real Estate Debt Fund XIV (REDF XIV) | $253M CAD | – | – | 11.7% | 65.7% | – | closed-end fund | – | March 31, 2026 |
| Trez Capital Prime Trust | $252M CAD | 7.2% | 6.3% | -2.7% | 48% | 1.15% | Trust | 96.2% | March 31, 2026 |
| Kuber Mortgage Investment Corporation | $245M CAD | 10.53% | 10.4% | 9.24% | 71% | 0.65% | Private Corporation (MIC) | 81% | April 30, 2026 |
| First Circle Mortgage Investment Corporation | $243M CAD | 9.81% | 9.9% | 8.94% | 52% | 1.5% | Private Corporation (MIC) | 91% | January 1, 2026 |
| UMC Mutual Fund Trust | $241M CAD | 7% | – | – | 75% | 0.6% | Trust | – | December 31, 2023 |
| Foremost Mortgage Trust | $240M CAD | 8.75% | 8.23% | 8.3% | 50.2% | 1% | Trust | – | March 31, 2026 |
| Terrapin Mortgage Investment Corp. | $236M CAD | 8.5% | 11.2% | 11.07% | – | – | Private Corporation (MIC) | 87% | May 31, 2026 |
| RiverRock Mortgage Investment Corporation | $230M CAD | 8.57% | 9.11% | 8.57% | 66.9% | 1.25% | Private Corporation (MIC) | 83.3% | May 1, 2026 |
| Amur Capital Conservative Income Fund Inc. | $219M CAD | 8.29% | 10.75% | 9.1% | 43% | 1.5% | Private Corporation (MIC) | 75.6% | March 31, 2026 |
| CMI MIC High Yield Opportunity Fund | $219M CAD | 10.79% | 10.82% | 10.68% | 76.8% | 1% | Private Corporation (MIC) | 25.2% | March 31, 2026 |
| Peakhill Income Bridge, LP | $207M CAD | – | – | 13.8% | – | 1.5% | Delaware Limited Partnership | 100% | December 31, 2025 |
| Nicola U.S. Mortgage Fund | $201M CAD | 5.4% | 4.4% | 5% | 60.6% | – | Trust | 100% | April 30, 2026 |
| Ginkgo Mortgage Investment Corporation | $195M CAD | 9.75% | 9.75% | 8.5% | 65.5% | 1.5% | Private Corporation (MIC) | 87.9% | May 31, 2026 |
| YTM Capital Mortgage Income Fund | $184M CAD | 7.37% | 7.47% | 6.83% | 59% | 1.5% | Open-Ended Mutual Fund Trust | 96% | May 31, 2026 |
| Genesis Mortgage Investment Corporation | $180M CAD | 9.84% | 8.62% | 8.24% | 60.3% | 2% | Private Corporation (MIC) | 52.6% | March 31, 2026 |
| First Source Mortgage Fund | $179M CAD | 9.8% | 9.1% | – | 64.2% | 1.75% | Partnership (LP) and Trust | 80.3% | December 31, 2024 |
| Oakhill Lending Corp | $174M CAD | 11.61% | 12.42% | 11.36% | 61.8% | 2.5% | Private Corporation (MIC) | 20% | May 31, 2026 |
| CMI MIC Balanced Mortgage Fund | $153M CAD | 8.79% | 8.84% | 8.75% | 68.9% | 1% | Private Corporation (MIC) | 77.4% | March 31, 2026 |
| Trez Capital Yield Trust U.S. (USD) | $146M CAD | 9.4% | 8.9% | -0.4% | 63.9% | 1.5% | Trust | 77.8% | March 31, 2026 |
| Hosper MIC Balanced Fund | $143M CAD | 8.61% | 9.01% | 8.54% | 61.1% | 0% | Private Corporation (MIC) | 80% | June 30, 2026 |
| Amber Mortgage Investment Corp. | $142M CAD | 8% | – | – | 65% | 2% | Private Corporation (MIC) | 40.7% | February 15, 2023 |
| Addenda Eco-Social Commercial Mortgages Pooled Fund | $141M CAD | 8.05% | 6.98% | 6.31% | 55.2% | – | Trust | Primarily | December 31, 2025 |
| Cameron Stephens High Yield Mortgage Trust | $140M CAD | 9.16% | 10.04% | 7.46% | 60% | 1% | Mutual fund trust | 53.4% | December 31, 2025 |
| ACM Mortgage Fund One | $130M CAD | – | – | – | – | – | Trust | – | June 30, 2026 |
| Premiere Canadian Mortgage Corp. | $124M CAD | 7.11% | 8.5% | 9.13% | – | – | Private Corporation (MIC) | 96% | August 31, 2025 |
| New Haven Mortgage Income Fund | $122M CAD | 8.21% | 8.45% | 8.52% | 60.9% | 1.5% | Private Corporation (MIC) | 90% | July 31, 2025 |
| Bayfield Mortgage Investment Corp. | $120M CAD | 9.1% | 10.2% | – | 49% | 1.5% | Private Corporation (MIC) | 56.5% | April 30, 2025 |
| Sinclair-Cockburn Mortgage Investment Corporation (SCMIC) | $109M CAD | 8.4% | 7.6% | 5.4% | – | 2.04% | Private Corporation (MIC) | 64% | December 30, 2025 |
| Bancorp Balanced Mortgage Fund II | $87M CAD | 8.64% | 9.08% | 7.89% | 54% | 1.5% | Private Corporation (MIC) | 98% | March 31, 2026 |
| High Yield Mortgage Investment Corporation — CMCC High Yield MIC | $85M CAD | – | – | – | – | – | Private Corporation (MIC) | – | December 31, 2025 |
| Liahona Mortgage Investment Corp. (LMIC) | $84M CAD | 8.3% | 8% | 7.7% | 66% | 3% | Private Corporation (MIC) | 91% | April 1, 2026 |
| All Island Equity MIC | $82M CAD | 7.24% | 7.6% | 8.31% | 49.8% | – | Private Corporation (MIC) | 89.2% | July 31, 2025 |
| Morrison Financial Mortgage Income Junior Fund | $70M CAD | 9.62% | 9.72% | 9.08% | 52.7% | 1% | Trust | 83% | December 31, 2025 |
| Morrison Financial Mortgage Income Senior Fund | $70M CAD | 7.68% | 7.8% | 7.08% | 52.7% | 1% | Trust | 83% | December 31, 2025 |
| Western Canada High Yield Mortgage Fund (WCHY) | $70M CAD | – | – | – | – | – | Partnership | – | June 4, 2025 |
| Armada Mortgage Corporation | $69M CAD | 8.8% | 9.4% | 8.6% | 45.1% | 1.5% | Private Corporation (MIC) | 70% | March 31, 2026 |
| RESCO Mortgage Investment Corporation | $65M CAD | 8% | 8% | 7.73% | 71.8% | 0.75% | Private Corporation (MIC) | 77% | March 31, 2026 |
| Bancorp Growth Mortgage Fund II | $61M CAD | 11.5% | 10.84% | 8.01% | 69.3% | 1.75% | Private Corporation (MIC) | – | March 31, 2026 |
| Capstone First Mortgage Fund LP | $60M CAD | 9.3% | 9.3% | -12.4% | – | 0.75% | Partnership (LP) | – | June 30, 2026 |
| CareVest Mortgage Investment Corporation | $60M CAD | 7.46% | 6.71% | 5.42% | 58.1% | 1.35% | Private Corporation (MIC) | 100% | December 31, 2025 |
| Royal Canadian MIC | $55M CAD | 8% | 8.29% | – | 65.4% | 2% | Private Corporation (MIC) | – | April 1, 2025 |
| CareVest Senior Mortgage Investment Corporation | $54M CAD | 7.22% | 6.8% | 5.39% | 57.6% | 1.35% | Private Corporation (MIC) | 100% | December 31, 2025 |
| Cannect Mortgage Investment Corporation | $50M CAD | 8.73% | 8.86% | – | 51.2% | 2% | Private Corporation (MIC) | 59.8% | May 1, 2024 |
| Gentai Commercial Mortgage Fund | $50M CAD | 10.9% | 10.47% | 9.87% | 66.9% | 2% | Open-Ended Mutual Fund Trust | 33% | March 31, 2026 |
| Gentai Residential Mortgage Fund | $48M CAD | 7.51% | 7.36% | 7.43% | 68.8% | 2% | Open-Ended Mutual Fund Trust | 78.8% | March 31, 2026 |
| Amur Capital High Yield Fund Inc. (“ACHYF”) | $45M CAD | 14% | 13.8% | 13.7% | 70% | 2% | Private Corporation (MIC) | 0.2% | March 31, 2026 |
| Climate & Social Fund | $44M CAD | – | – | – | – | – | Trust | – | June 30, 2026 |
| Truvera Mortgage (Senior) -1 Limited Partnership | $36M CAD | 8% | 6.71% | – | 45% | 1.75% | Partnership (LP) | 100% | July 13, 2023 |
| Almore Capital Mortgage Fund Limited Partnership | – | – | – | – | 56% | 1% | Partnership (LP) and Trust | 100% | N/A |
| IMC Active Mortgage Fund | – | – | – | 7.39% | 57.9% | – | open-ended fund | – | December 31, 2023 |
| Morex Capital Corp | – | – | – | – | 70% | 1.37% (Class A) | Private Corporation (MIC) | 74% | March 2026 |
Past performance does not guarantee or indicate future results. Where multiple share classes exist, performance shown may reflect the best-performing class and may not be available to all investors. Investment involves risk, including possible loss of principal, and this material does not constitute investment advice. Please refer to the relevant offering documents before investing.
Main Investment Type
Fund Structure
Percentages represent share of MIEs; numbers in brackets show number of MIEs.
2025 Return Rate by Fund
How Mortgage Investment Entities Work
Mortgage Investment Entities generate returns by pooling investor capital and lending it out as short-term mortgages (typically 6–24 months) secured by Canadian real estate, with interest and fees flowing back to investors after expenses. Mortgage Investment Entities operate through a structured lending cycle — understanding this process helps investors evaluate how returns are generated and where risks arise.
- Step 1: Capital is Raised from Investors — Individuals or institutions invest capital in the MIE, either by purchasing shares (in a corporation), units (in a trust), or partnership interests.
- Step 2: Funds Are Deployed into Mortgages — The MIE manager originates or acquires mortgages, typically short-term (6 to 24 months), secured by Canadian real estate.
- Step 3: Borrowers Pay Interest and Fees — Borrowers make regular interest payments, often at higher rates than traditional mortgages due to increased risk or non-prime status.
- Step 4: Income Is Collected and Expenses Deducted — The MIE deducts management fees, servicing costs, and potential loan losses.
- Step 5: Net Income Is Distributed to Investors — Remaining income is distributed periodically (monthly, quarterly, or annually), depending on the structure.
| Stage | What happens | Key risk |
|---|---|---|
Capital raising | Investors commit funds to the MIE | Liquidity constraints |
Loan origination | Mortgages are issued to borrowers | Underwriting risk |
Interest collection | Borrowers make regular payments | Default risk |
Expense deduction | Fees and losses deducted from income | Fee drag |
Distribution | Net income paid out to investors | Variable returns |
MIEs are actively managed, and returns depend on loan performance, property values, and borrower repayment.
Stated annualized returns assume a fixed price of $10.00/unit. DRIP returns assume compounding at the Q1 2026 cash yield and full participation in the distribution reinvestment plan. Past performance does not guarantee or indicate future results. Almore Capital Ltd. is registered as an Exempt Market Dealer in the province of Ontario.
Mortgage Investment Corporation (MIC)
Mortgage Investment Corporations (MICs) are the most common and most standardized form of MIE from a tax perspective. While all MICs are MIEs, not all MIEs qualify as MICs.
The MIC structure was created under the Income Tax Act to encourage mortgage lending by allowing eligible corporations to act as flow-through entities, avoiding double taxation.
A Mortgage Investment Corporation is:
- One specific type of MIE
- Defined explicitly in section 130.1 of the Income Tax Act
- A Canadian corporation that meets strict criteria to receive favourable flow-through tax treatment.
Because of these rules:
- MICs pay no corporate tax on income distributed to shareholders
- All net income must be distributed to investors
- Distributions are taxed as interest income, not dividends
That makes MICs the most common and standardized form of MIE — but not the only one.
MIE vs. MIC: Key Differences
| MIE | MIC | |
|---|---|---|
| Structure | Corporation, trust, or partnership | Canadian corporation only |
| Tax Treatment | Depends on structure and accounting | Flow-through; no corporate tax |
| Regulatory Requirements | Varies by province and structure | Must meet strict Income Tax Act rules |
| Common Usage | Broad category | Standardized investment product |
Types of Mortgages Funded by MIEs
Mortgage Investment Entities typically fund private mortgages rather than conventional bank loans. These may include:
- First mortgages
- Second mortgages
- Construction or bridge financing
- Commercial mortgages
Interest rates on MIE-funded mortgages are generally higher than bank rates due to borrower risk and flexibility.
For securities compliance, introductions to the Morrison's Funds are to be conducted exclusively by registered dealers. Morrison Financial has retained Belco Private Capital Inc. as its exempt market dealer. All new or additional investments must be conducted through a registered dealing representative of an exempt market dealer. Past performance is no guarantee of future results. Actual performance may vary materially from the above-projected return.
Potential Benefits of Investing in an MIE
- Regular income from mortgage interest
- Exposure to real estate without direct property ownership
- Portfolio diversification beyond stocks and bonds
- Potential eligibility for registered accounts (in some structures)
Benefits depend on the specific MIE structure, lending strategy, and manager.
Risks of Mortgage Investment Entities (Detailed Breakdown)
Investing in an MIE involves several layers of risk that differ from traditional fixed-income or equity investments.
Borrower default risk
If borrowers fail to repay their mortgages, the MIE may incur losses. While loans are secured by real estate, recovery depends on property value and market conditions.
Loan-to-value (LTV) risk
Higher LTV ratios increase the likelihood that the loan balance exceeds the property value in a downturn, reducing recovery when a borrower defaults.
Real estate market risk
Declines in housing or commercial property prices can reduce collateral value and increase loss severity across the portfolio.
Liquidity risk
Most MIEs are not publicly traded. Investors may face lock-in periods, limited redemption windows, and delays in accessing capital.
Manager & underwriting risk
Returns depend heavily on the MIE manager's ability to properly assess borrower risk, diversify the portfolio, and manage defaults effectively.
Interest rate risk
Changes in interest rates can impact borrower demand, default rates, and the relative attractiveness of MIE investments vs. other fixed-income options. Changes in interest rate also change the present value of fixed-rate mortgages.
Concentration risk
Many MIEs focus on specific regions or property types. This lack of diversification can amplify losses during localized downturns.
Returns and Typical Yields of MIEs in Canada
Returns from Mortgage Investment Entities vary based on the risk profile of the underlying mortgages, geographic focus, and management quality. In Canada, MIEs have historically targeted:
- 5% to 10% annually for lower-risk portfolios (primarily first mortgages)
- 8% to 12%+ annually for higher-risk strategies (second mortgages, construction loans)
Returns are driven primarily by:
- Interest rates charged to borrowers
- Loan-to-value (LTV) ratios
- Default rates and recovery outcomes
- Fees charged by the MIE manager
MIE returns are typically income-based, derived from mortgage interest and fees, and are less correlated with public equity markets.
Important: Higher advertised yields often reflect higher credit risk or lower-quality collateral.
Tax Treatment of MIE Investments
How your MIE income gets taxed depends on the structure. MICs pass their income through as interest, which is fully taxable at your marginal rate with no dividend tax credit to soften the blow. MIEs set up as trusts or partnerships can pay out a mix of interest, capital gains, and return of capital — the last of which isn't taxed right away but lowers the adjusted cost base of your investment, so the tax catches up when you sell. Anyone investing should talk to a tax advisor about their own situation before making a decision.
Who Should Consider an MIE?
Mortgage Investment Entities may be considered by investors who:
- Are seeking income-oriented investments
- Understand real-estate-backed lending risks
- Can tolerate limited liquidity
- Want exposure to alternative mortgage lending
How MIEs Are Regulated in Canada
MIEs sit at an unusual intersection: they're at once mortgage lenders (regulated provincially in most cases, federally for the few that hold a bank or loan-company charter like MCAN) and securities issuers (a provincial matter). Three overlapping regulatory frameworks apply, and a serious problem in any one of them can take a fund off the rails.
The Federal MIC Rule (Income Tax Act s. 130.1)
To call itself a MIC, a fund must clear these tests:
- At least 50% of assets in residential mortgages or short-term cash-equivalent deposits
- Cannot directly own real estate except property acquired through foreclosure
- At least 20 shareholders
- No shareholder (with related parties) may hold more than 25% of any class of shares
In return for meeting these tests, the MIC pays no corporate tax on income it distributes – it acts as a flow-through. Distributions in shareholders' hands are taxed as interest, not as dividends, which is the single most important fact for tax planning purposes.
Trust MIEs (Romspen, Trez, Capital Direct I, Morrison, Neighbourhood, etc.) are taxed under the trust rules in sections 104–108 of the Act instead, and the federal MIC tests don't apply to them.
Securities Regulation
MIE units and shares are securities regulated by provincial commissions through the CSA. Almost all MIEs are sold under prospectus exemptions in National Instrument 45-106. The main exemptions are:
- Accredited Investor – the workhorse for higher-minimum funds. Qualifies with $200,000+ personal income (or $300,000+ with a spouse), $1 million+ financial assets net of liabilities, or $5 million+ net assets
- Offering Memorandum (OM) – lets retail investors into smaller-minimum funds. Investors sign a Risk Acknowledgement (Form 45-106F4); capped at ~$30,000/year for non-accredited investors (varies by province)
- Eligible Investor – broadly $75K+ income or $400K+ net assets; lets investors put more in than the standard OM cap
Mortgage Lender Licensing
Mortgage lending is split between federal and provincial regimes:
- Federal (OSFI) – amongst MIEs, only MCAN Mortgage Corporation holds this status
- Ontario – regulated by FSRA
- British Columbia – regulated by BCFSA
- Alberta – regulated by RECA
- Quebec – regulated by AMF
Recent Regulatory Action
The Romspen and Trez Capital redemption suspensions have sparked CSA discussions on liquidity disclosure and gating policies. Key developments:
- Investors who treated these funds as quasi-cash discovered they aren't – regulators are now sharper about how funds describe redemption terms
- Frontenac MIC was hit with an OSC failure-to-file cease trade order in July 2025 and is now winding down
- After the Fortress Real Capital scandal, Ontario tightened its regime for syndicated mortgages
- The CSA, OSC, and BCSC have all signalled increased scrutiny of private/exempt-market funds in 2025–2026
What This Means for an Investor
You'll be classified as Accredited, Eligible, or Non-Eligible – that controls which funds you can access and how much you can invest. Key things to know:
- Be prepared to fill out a Risk Acknowledgement and Subscription Agreement
- The OM governs the fund – read the redemption mechanics, gating language, and related-party disclosure carefully, because those are the parts that bite when something goes wrong
- Exempt market means exempt from the prospectus requirement, not exempt from regulation – disclosure standards are lower, and the secondary market is essentially nil
- If liquidity matters to you, choose a publicly-listed MIC (Timbercreek, Firm Capital, Atrium, MCAN) instead
With the exception of rare cases like MCAN Mortgage Corporation – which is both a MIC and a federally regulated loan company – most MIEs are not supervised by OSFI and instead operate under provincial mortgage and securities regimes.
For securities compliance, introductions to the Morrison's Funds are to be conducted exclusively by registered dealers. Morrison Financial has retained Belco Private Capital Inc. as its exempt market dealer. All new or additional investments must be conducted through a registered dealing representative of an exempt market dealer. Past performance is no guarantee of future results. Actual performance may vary materially from the above-projected return.
Frequently Asked Questions
A: Not in the way a GIC or a savings account is safe — there's no CDIC coverage, and you can lose some or all of your money. How risky an MIE actually is comes down to who's managing it, what kinds of mortgages are in the pool, how much they're lending against each property, and what the real estate market is doing. A fund that sticks to low-LTV first mortgages on Canadian homes is a different animal than one funding second mortgages or construction deals. Neither is guaranteed.
A: In most cases, yes — especially if it's a MIC. Mortgage Investment Corporations are set up under the Income Tax Act specifically so they qualify for registered accounts like RRSPs, RRIFs, and TFSAs. Trust-based MIEs often work too, but it varies fund by fund. Limited partnerships usually don't qualify. The safest move is to check the fund's offering documents before you commit.
A: If it's a MIC, your distributions are treated as interest income. That means it's fully taxable at your marginal rate, with no dividend tax credit to soften the blow. If the MIE is a trust or partnership, the income might come through as a mix of interest, capital gains, or return of capital depending on how the fund is run. Holding your MIE inside an RRSP or TFSA is one way to sidestep the tax hit.
A: It depends on the fund. Publicly traded MICs like Timbercreek, Firm Capital, Atrium, or MCAN can be bought through any brokerage for the price of a single share. Private MIEs are a different story — retail-friendly funds usually start somewhere between $1,000 and $25,000, while funds restricted to accredited investors can require $25,000 to $150,000 or more.
A: An MIE is the umbrella term for any pooled fund that lends money on Canadian real estate. An MIE can be a corporation, a trust, or a partnership. A MIC is one specific flavour of MIE: a Canadian corporation that meets a strict set of rules in the Income Tax Act and gets flow-through tax treatment in exchange. So every MIC is an MIE, but plenty of MIEs aren't MICs.
A: If the MIC is publicly traded, anyone with a brokerage account can buy in. Private MIEs are sold under securities exemptions, usually the Offering Memorandum exemption (open to most retail investors, with some investment limits) or the Accredited Investor exemption (you have to clear certain income or net-worth thresholds). A handful of funds also limit investors by province of residence.
A: Only if you're in a public MIC — those trade on the TSX and you can sell on any business day. Private MIEs are much stickier. Expect lock-up periods (often a year), monthly or quarterly redemption windows, notice requirements, and the manager's ability to pause redemptions entirely when things get rough. If you might need the cash soon, a private MIE probably isn't the right fit.
A: Historically, lower-risk MIEs focused on first mortgages have aimed for something in the 5% to 10% range annually. Higher-risk strategies — second mortgages, construction lending, more exotic commercial deals — have targeted 8% to 12% or more. Those are targets, not guarantees, and a higher advertised yield almost always means the fund is taking on more credit risk or weaker collateral.
A: The MIE enforces its security — typically through power of sale or, less commonly, foreclosure. The property gets sold and the proceeds go toward paying down the loan. Whether investors take a hit depends on what the property actually fetches, how much was owed, how much it costs to enforce, and how long the whole process takes. When the sale doesn't cover the loan, the shortfall eats into the fund's income and flows through to investor distributions.
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- Interest rates are sourced from financial institutions' websites or provided to us directly. Real estate data is sourced from the Canadian Real Estate Association (CREA) and regional boards' websites and documents.