A multiple-class mortgage cash flow security. Also referred to as a Collateralized Mortgage Obligation (CMO).
a CMO that qualifies for special tax treatment and invests in certain mortgages principally secured by interests in real property and other permitted investments
a creation of the tax law that allows the trust to be a pass-through entity which is not subject to tax at the trust level
a nontaxable entity formed for the sole purpose of holding a fixed pool of mortgages secured by an interest in real property and issuing multiple classes of interests in the underlying mortgages
a "tax election" to sell mortgages in a securitized loan making them a tax-exempt status
a tax structure offering several advantages not previously available in MBS offerings
A tax treatment introduced by the 1986 Tax Reform Act for multi-class mortgage-backed securities such as CMOs, Strips and senior/subordinated pass-throughs. An objective of the REMIC legislation was to permit issuers to assume a more streamlined legal form than that of the owners trust under which most CMOs had previously been issued. Issuers have the option to elect REMIC tax treatment until 1992, when REMIC tax treatment becomes mandatory. REMIC treatment identifies the securities created as one or more "regular" interests and a single "residual" interest. In market parlance, the term REMIC is used to refer to a structured mortgage-backed security electing REMIC status. More loosely, it is used interchangeably with CMO.
See Real Estate Mortgage Investment Conduit.
REAL ESTATE MORTGAGE INVESTMENT CONDUIT. The Tax Reform Act of 1986 created a new entity, the REMIC. The purpose of a REMIC is to hold a fixed pool of mortgages and issue interests in itself to mortgage investors. A REMIC may be a partnership, corporation, trust, or separate pool of assets. REMICs are intended to become the exclusive means for issuing multiple-class mortgage backed securities in a form that avoids the corporate double tax.
Real Estate Mortgage Investment Conduit. A security that represents a beneficial interest in a trust having multiple classes of securities. The securities of each class entitle investors to cash flows structured differently from the payments on the underlying mortgages.
Real Estate Mortgage Investment Conduit. A REMIC is a vehicle created under the Tax Reform Act of 1986 for issuing mortgage-backed securities. REMICs may be structured as corporations, partnerships, trusts, or as a segregated pool of assets and will not be subject to taxation at the issuer level in compliance with the requirements of the act.
Real Estate Mortgage Investment Conduit. An entity through which an issuer can sell multiple class securities with call protection to investors. A REMIC may be a corporation, trust, association, or partnership, but in order to qualify, it must confine its investments to mortgages, cash, government securities, foreclosure property acquired in connection with imminent default of a mortgage, or other REMICs. Typically, a REMIC invests in a pool of mortgages, and sells interests in those mortgages through securities with one or more senior classes and a subordinated class that assumes the credit risk of defaults and delinquencies. This creates a form of self-insurance that increases the investment ratings for the senior securities. A REMIC does not keep its mortgage assets on its books, but sells them to investors through its securities.
Real Estate Mortgage Investment Conduit. A vehicle for issuing multiclass mortgage backed securities which allows the issuer to treat the security as a sale of assets for tax and accounting purposes.
Real Estate Mortgage Investment Conduit. Created by TRA '86; allows companies to be formed for trading in mortgage pools and escaping double tax imposed on corporations.
Real estate mortgage investment conduit. An entity that is formed for the purpose of holding a fixed pool of mortgages secured by interests in real property, with multiple classes of interests held by investors. These interests may be either regular or residual.
Real Estate Mortgage Investment Conduits. A multi-class mortgage pass-through security very similar to a CMO. REMIC certificates represent beneficial ownership interests in pools of mortgage loans or mortgage-backed securities. Most REMICs are multi-class pass-through bonds that pay in class order, e.g., class one must be paid in full before class two begins paying principal. The final class is usually an accrual class which pays no principal or interest until all prior classes are paid in full.
Real Estate Mortgage Investment Conduit. A tax entity that issues multiple classes of investor interests (securities) backed by a pool of mortgages. (See securitization)
Real Estate Mortgage Investment Conduit. A product of 1986 federal tax legislation in which a business entity such as a corporation, partnership, or trust in which substantially all of the assets consist of qualified mortgages and permitted investments, elects to be treated as a REMIC. Qualification avoids treatment as a corporation for tax purposes.
An investment grade mortgage bond that separates mortgage pools into different maturity and risk classes.
Real estate mortgage investment conduit. A kind of "mutual fund" that invests in real estate mortgages rather than stocks and bonds.
Real Estate Mortgage Investment Conduit; a specific tax status for a mortgage-backed security issuance. Often used synonymously with CMO, since almost all CMOs are issued as REMICs.
Real Estate Mortgage Investment Conduit -- View Real Estate Listings
Real Estate Mortgage Investment Conduit. As a result of a change in the 1986 Tax Reform Act, most CMOs are today issued in REMIC form to create certain tax advantages for the issuer. The terms "REMIC" and "CMO" are now used interchangeably.
A “real estate mortgage investment conduit†within the meaning of Section 860D of the Code.
Real Estate Mortgage Investment Conduit. REMICs may be partnerships, corporations, trust, etc. and are used to hold a fixed pool of mortgages, which are then marketed as tax exempt mortgage backed securities for investors.
A product of the Tax Reform Act of 1986, REMICs are designed to hold a pool of mortgages for the exclusive purpose of issuing multiple classes of mortgage-backed securities in a way that avoids a corporate double tax.