Realty Investments Mortgage Corporation (RIMC) is evolving. RIMC came into being in the 80s, early 80s, actually 78, but this is where we were starting to do more and more with doctors and pension plans, and they didn't have a home for their money. The pension plans and the 401Ks were all put together by insurance people, and the insurance people went out and helped them start the corporation and set up the 401K, but all they had to sell them were insurance products, which were life insurance, annuities. They would generally bring a stockbroker in, but they couldn't provide anything else.
We started offering mortgages that were secured by the properties that other doctors owned, so instead of going to the bank to create the loan, we created the loan through a pension plan. The pension plan instead of getting 6% at the bank was getting 8 to 10% from us, so we're consistently about 4% above similar duration T-note. As we got farther and farther away from the doctors and the pension plans and the pension plans became more heavy regulated, then we started doing second trusts and creating more leverage than what the banks were willing to do.
Since leverage accelerates yield on appreciating property. If you invest 50% down and you earn 10%, your yield is 20% starting at the very first year, but if you have the same deal with 10% down, your yield is 100%. We started allowing our clients to invest in these mortgages, and for over 40 years we've never had a default ever. Our clients are able to, in today's market, earn 6% on money that they would earn 0.2% on the bank, so that's basically what those are for.
We've always done them as favors for our clients, so we aren't going to go beat the street and raise mortgage money necessarily, but we will turn around and say, "Well, Brett, if you have some extra cash and you got money in the bank, and you're losing that money to inflation. Right now on a 2-year CD, xxx Bank will pay you 0.2%. It's taxable, so after taxes, it's 1.5%, inflation's 3, so if every year you have the money in the bank, you're losing money on it. If instead I gave you 6%, after taxes, it's 4 to 4.5%." You're beating inflation and that's one of the few places that on a short-term basis you can beat inflation. You can't do it in bonds because that's longer term. Rates are going up, inflation's going up.