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What is a Mortgage Trust?

Mortgage trusts are an investment vehicle that lends investor money to commercial borrowers to finance land subdivision, property development or construction. These loans are generally secured by mortgages over property as the primary security. 

Many mortgage trusts will also invest a percentage of investors’ money in cash and fixed interest investments, which are considered liquid investments, to manage the Trust’s current and future cashflow requirements. 

They aim to generate a regular and competitive income for investors via loan repayments, interest and fees paid by the borrowers, as well as income from cash and other underlying investments held by the trust. 

Mortgage trusts are also commonly known as mortgage funds.

Potential benefits of a Mortgage Trust

Professional management

When you invest in a professionally managed mortgage trust, an experienced fund manager will source and acquire the mortgage, as well as take care of administration and ongoing management of the loan on your behalf – so you won’t have to.  

Exposure to the property sector

The Australian property market is a popular investment option among many investors. Mortgage trusts provide an alternative way to invest in the property sector without direct property ownership. 

Competitive income

For investors seeking income, mortgage trusts are designed to pay a competitive income via regular distributions. The level of yield will vary depending on the performance of the individual trust or specific mortgage. 

Portfolio diversification

Depending on the type of trust, pooled mortgage trusts may provide diversification across various borrowers, geographic locations, property sectors, project types, loan sizes and Loan to Valuation Ratios within the trust’s portfolio.  

Mortgage trusts may also be a suitable investment option to include as part of a diversified investment portfolio. 

Our mortgage trust investment option

Trilogy Monthly Income Trust

8.05% PA*

Minimum investment

Investment strategy 

An investment that seeks to provide income from a portfolio of loans secured by first mortgages over Australian property.

Distribution frequency 

Aims to pay monthly.

  • Open for investment
  • Minimum investment $10,000
  • Unit price of $1.001
  • Option to reinvest

*The net distribution rate paid to investors for the month ended 30 April 2024. Net distributions are variable each month and are quoted net of management fees, costs and assume no reinvestment. Distributions are calculated daily and paid monthly in arrears. Please note, past performance is not a reliable indicator of future performance.

1Whilst the unit price is fixed, capital losses can occur in circumstances where an asset of the Fund incurs a capital loss.

Learn more about Mortgage Trusts on our blog

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