Investors reach the same asset class two ways. In a direct or syndicated mortgage you hold a charge, or a share of one, registered against a specific property. In a MIC you hold shares in a corporation that owns a pool of mortgages. The difference is not a detail — it changes the risk, the paperwork, the regulator and the work you have to do.
| MIC shares | Direct / syndicated mortgage | |
|---|---|---|
| What you own | Shares in a corporation that owns a pool of mortgages | A charge, or an undivided interest in one, registered on title to a specific property |
| Diversification | Exposure to the whole book; one default is absorbed across the pool | One borrower, one property. Their default is your default |
| Who does the work | The manager and licensed administrator service, renew and enforce | You do — or you pay a licensed administrator to |
| Regulation of the offering | Securities law. Shares are securities, distributed under prospectus exemptions through a registered dealer | In Ontario, syndicated mortgages moved under securities regulation in 2021; non-syndicated private mortgages arranged by a brokerage remain under FSRA |
| Disclosure you receive | Offering memorandum with audited financial statements, plus statutory rights of action | An investor/lender disclosure statement signed by a licensed broker, delivered before funds are advanced |
| Liquidity | Illiquid; redemption per the articles and offering memorandum, with notice periods | Illiquid until the mortgage is discharged or the charge is sold |
| Tax | Dividends deemed to be interest | Mortgage interest, taxed as interest |
| Failure mode | Portfolio-level: a run of defaults or falling values compresses or suspends distributions | Single-file: enforcement, a power of sale, legal cost and time — on the one asset you own |
