Mortgage Investment Corporation (MIC) – Part II
Can a shareholder borrow money from Mortgage Investment Corporation (MIC)?
Now, this is a tricky question. We would like to explain it to you as follows:
1) Yes you can borrow money from the Mortgage Investment Corporation (MIC), provided that you have purchased your shares in the form of hard cash, subject to all the qualifications, rules, and regulations set up by the corporation
2) No, you cannot borrow money if you have purchased your shares of the Mortgage Investment Corporation (MIC) inside of your Registered Retirement Savings Plan (RRSP), Registered Retirement Income Funds (RRIF), or Registered Education Savings Plan (RESP), because of the Income Tax Act.
What kind of properties can Mortgage Investment Corporation (MIC) finance under the Income Tax Act Canada?
1) The Mortgage Investment Corporation (MIC) is allowed to invest in Canadian mortgages, subject to the limitations set out in the Income Tax Act, as per following:
a. Residential mortgages across Canada including houses, town-houses, and condos
b. Project equity loans
c. Construction loans
d. Interim loans
e. Land Servicing loans
A successful full-time Canadian real estate investor looking to invest with MIC should be aware of and educated on these different loans and mortgages. Remember: the more you know, the less risk you will have!
Can Mortgage Investment Corporation (MIC) lend money to non-resident Canadians whose property is located in Canada?
1) Yes, under the limitations set out in the Income Tax Act, you are allowed to lend mortgages to non-resident Canadians as long as the property is located in Canada, subject to all qualifications set up by the corporation.
For those who are successful in the world of full-time Canadian real estate investing, the MIC can offer new ways to partner and benefit from larger opportunities as a whole group.
We will continue our series on MIC in our next article.
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