What is a REMIC? | IRS Definition of a REMIC

A REMIC is a Real Estate Mortgage Investment Conduit. It’s a fairly complicated type of investment that is most easily understood as a way by which investors are able to invest in mortgages and mortgage-backed securities. Real estate mortgages and mortgage-backed securities are packed up, and then they can be sold and resold. Because the REMIC as an investment vehicle includes other types of investment, it also means that the REMIC itself is a separate entity with a separate EIN.

REMICs entered into public scope during the fall of the housing market in 2008. As many banks had invested in REMICs, the banking industry had also been impacted by the housing market crisis, which caused the economic impact to be greater than it otherwise would have been. Since then, regulations and laws surrounding REMICs have increased, and they have remained a useful investment which can support the fluidity of the real estate market.

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Written by Maurice Mallory

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