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Real Estate Investment Trust - REIT
The primary business of an REIT is to buy, own and manage income-producing properties (via rent or leases). Profitability can be affected by vacancy and interest rate increases. They are bound to strict guidelines regarding income generated and distributions.
Mortgage Investment Corp - MIC
MIC funds are placed in a pool of secured private mortgages on property, however, the properties cannot be managed or developed like an REIT. Half (50%) of its assets must be invested in residential mortgages and they typically have a lower LTV ratio (< 80%).
Mortgage Trust - MFT
An MFT is legally structured as a mutual fund but have advantages over an MIC. Similar to an REIT, underlying assets are secured against property in the form of mortgages, but, unlike an MIC, the MFT can also hold real estate over the long term in the trust. In the event of an economic downturn, bankruptcy, foreclosure, power of sale, etc, mortgage trusts are able to seize the underlying asset and can choose to rent, hold, or sell. Mortgage Trusts are also not limited in the types of mortgages that can be invested and do not need to have 50% of their assets in residential mortgages.
