MORTGAGES

Given our lifelong appreciation of real estate, the Mortgage marketplace is an area of significant interest to us. In our opinion this is a marketplace where, similar to the Private Equity marketplace, an investor can get a decent annual rate of return while providing much better protection and preservation of capital compared to the publicly traded stock markets. In the Mortgage marketplace, if you are interested, we assist you in facilitating different private mortgage lending opportunities with most of these investments offering 2 mortgage security. In our opinion, private mortgage nd
lending seems to be misunderstood by many investors so we fulfill an important role by explaining how this works as well as explaining all the good, and the possible bad, related to private mortgage lending. Also, in the Mortgage marketplace, we deal with the very misunderstood concept of holding mortgages in your RRSP. There are many opportunities in this area and we just do not see many investment firms providing the necessary information for investors to make informed decisions. In fact, we’ll go as far to say that in our opinion the idea of holding mortgages in your RRSP is something the rest of the investment industry simply does not want you to know. Think of it this way, if you had a $100,000 mortgage with a bank (where the bank would be making at least a 2-3% profit spread) and you also had a $100,000 in your RRSP at that same bank (where the bank would be making a 2 1⁄2% management fee), do you really think the bank would suggest for you to use the $100,000 in your RRSP to hold your
own mortgage in your RRSP and pay off the $100,000 bank mortgage? Of course not, the answer is “no” because they would lose the 5-6% they make on your money, which makes us wonder whether you are really receiving the best possible investment advice from the banks.

Also, in the Mortgage marketplace, we deal with “syndicated mortgages”. This is a type of mortgage funding which is used to finance large condominium developments that you currently see in medium to large residential centers (most of the condominium developments you see in downtown Toronto are funded by syndicated mortgages). A syndicated mortgage is simply a mortgage registered against a building and that mortgage has the names of all the people who
have invested into the project so, yes your investment is registered against the building you are funding but your name is included with the names of all the other investors in the project. While syndicated mortgages have been around for some time, their popularity increased after the publicly traded stock market crash in 2008 after which the banks severely restricted the amount of financing they would provide to large development projects so, as a result, syndicated mortgages were used to finance what the banks would no longer fund.

Advantages of Mortgages no direct exposure to global stock markets; security against real property :

Disadvantages of Mortgages certain liquidity risks; mortgage payment defaults