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MLI Select vs Conventional Calculator

Three numbers in, term sheet out. Enter purchase price, unit count, and NOI — max loan, what binds (LTV or DCR), and cash flow for MLI Select, MLI Standard, and conventional.

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MLI Select vs Conventional

Three numbers in — purchase price, units, NOI — term sheet out.

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LendCity™ Mortgages

Investment Financing Specialists

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This MLI Select vs Conventional Financing Calculator is just the beginning. Our team of specialists is ready to help you structure your next deal for maximum growth and cash flow.

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Program compare LTV · amort

Select, Standard, conventional

Select 50-year amort is new construction (existing 40-year). Standard 40-year. Conventional 25-year, 1.25 DCR.

Select 100 pts 95% LTC

Up to 50 years

Select 50 pts 85% LTV

Up to 40 years

MLI Standard 85% LTV

Up to 40 years

Conventional 75% LTV

Up to 25 years

Understanding Your Options

How to Compare Financing Options

Three numbers in, term sheet out. Enter purchase price, unit count, and NOI, then read max loan, the binding constraint, and cash flow for MLI Select, MLI Standard, and conventional.

  • № 01 01

    Enter three numbers

    Purchase price, unit count, and annual NOI. Unit count is display-only; loan math uses price, NOI, rate, and amortization.

  • № 02 02

    Set building type and rates

    Toggle existing vs new construction (Select 40- vs 50-year amort). Adjust CMHC and conventional rates.

  • № 03 03

    Read the term sheet

    Each column sizes loan as the lesser of LTV and DCR, shows what binds, then payments, cash flow, and DSCR. Export a PDF and book a strategy call.

Understanding Your Options

MLI Select, MLI Standard, and Conventional Financing Explained

Learn how each financing option works and which might be best for your multifamily investment strategy.

When financing a multifamily property in Canada, you have three primary options: CMHC MLI Select (government-insured, points-based), CMHC MLI Standard (government-insured, no points), and conventional financing (non-insured). Each option has distinct advantages and trade-offs that significantly impact your down payment, monthly payments, cash flow, and long-term returns.

Understanding these differences is critical because the choice of financing can mean the difference between a highly profitable investment and one that struggles to generate adequate cash flow. The right financing option depends on your capital availability, property characteristics, desired cash flow profile, and investment timeline.

The Three Financing Options at a Glance
  • № 01

    MLI Select (CMHC)

    95% LTV | 40-year existing / 50-year new construction | Min DCR 1.10 | Mortgage insurance required | Affordability, energy, or accessibility points

  • № 02

    MLI Standard (CMHC)

    85% LTV | 40-year amortization | Min DCR 1.30 (5-year) / 1.20 (10-year) | Mortgage insurance required | No points

  • № 03

    Conventional

    75% LTV | 25-year amortization | Min DCR 1.25 | No insurance | Higher rates

MLI Select: Maximum Leverage with Point-Based Rewards

MLI Select is CMHC's enhanced program for multifamily properties that commit to social or environmental outcomes. It's the most aggressive financing option, allowing 95% loan-to-value and up to 50-year amortization for properties earning sufficient points in affordability, energy efficiency, or accessibility.

The key advantage: minimizing down payment. On a $2.5M purchase, MLI Select requires only $125,000 down (5%), versus $375,000 (15%) for MLI Standard or $625,000 (25%) for conventional. This preserves capital for closing costs, reserves, or additional investments. The extended 50-year amortization (at maximum points) further reduces monthly payments, dramatically improving cash-on-cash returns.

The trade-off: mortgage insurance premiums (2.4–4% of the loan), added to your financed amount, increase total interest cost over time. Additionally, MLI Select requires documentation of your commitment (rent-restricted units, energy certification, accessible design), adding some administrative complexity.

MLI Standard: The Middle Ground

MLI Standard is CMHC's base multifamily program. It allows 85% LTV and 40-year amortization without requiring the points system or commitments of MLI Select. Most properties that don't qualify for or don't want MLI Select points use MLI Standard.

MLI Standard still requires mortgage insurance (typically 1.8–3% premium). Min DCR is 1.30x on a 5-year term and 1.20x on a 10-year term — never 1.10x. For a property that doesn't meet MLI Select thresholds or where the affordability/energy/accessibility commitment isn't appealing, MLI Standard offers the best CMHC terms without additional conditions.

Conventional Financing: No Insurance, Higher Requirements

Conventional financing means the lender (typically a bank or mortgage company) holds all credit risk—no government insurance backing. This requires a larger down payment (25% minimum for multifamily), shorter amortization (25 years typical), and higher interest rates (typically 50–100 basis points above CMHC).

Conventional lenders typically require 1.20–1.30x DSCR. That is in the same band as MLI Standard (1.30x / 1.20x by term). MLI Select standard rental is the CMHC program at 1.10x.

The advantage: no mortgage insurance costs. The disadvantage: significantly higher monthly payments due to the larger down payment, shorter amortization, and higher rates. On a $2.5M property generating $300,000 annual income, monthly payments can be $500–$1,000+ higher on conventional versus MLI Select.

Financial Impact: The Numbers Matter

Financial Impact: The Numbers Matter

Consider a $2.5M multifamily property with $300,000 annual gross income and $100,000 annual operating expenses (NOI = $200,000):

MLI Select $125,000

~$10,500/mo · 1.90x DSCR

MLI Standard $375,000

~$11,200/mo · 1.78x DSCR

Conventional $625,000

~$12,800/mo · 1.30x DSCR

Notice: MLI Select preserves $500,000 in capital versus conventional while improving monthly cash flow by $2,300. Over 5 years, that's $138,000 additional cash flow plus capital preserved for other investments.

Which Option is Right for You?

Which Option is Right for You?

  • № 01

    Choose MLI Select if

    Your property qualifies (affordability, energy, or accessibility commitments), you want minimal down payment, you prioritize cash flow, or you're building a portfolio on limited capital. Purpose-built rentals and value-add energy retrofits often benefit most.

  • № 02

    Choose MLI Standard if

    Your property doesn't qualify for MLI Select points, you want CMHC terms without additional commitments, or the point requirements don't fit your strategy. It's the most common CMHC option.

  • № 03

    Choose Conventional if

    You have substantial down payment capital (25%+), you want to avoid mortgage insurance costs, your property doesn't meet CMHC lending criteria (too small, non-standard), or you prefer a simpler underwriting process without CMHC insurance paperwork.

Making Your Decision

Making Your Decision

Use this calculator to model your specific property. Enter your purchase price, income, expenses, and current interest rates. Compare the down payment required, monthly payment, cash flow, and DSCR across all three options. The highlighted results show which option optimizes for each metric, helping you make an informed decision.

Then book a strategy call with our lending specialists. We can review your property details, discuss whether MLI Select points are achievable, model various interest rate scenarios, and guide you toward the financing option that maximizes returns while meeting your capital and cash flow goals.

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Making Your Decision

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FAQ Q & A

MLI vs Conventional Financing FAQs

Common questions about comparing MLI Select, MLI Standard, and conventional multifamily financing options.

MLI vs Conventional Overview

MLI Select (CMHC government-insured) allows 95% LTV with 50-year amortization, requires insurance, and typically has lower rates. Conventional financing offers 75% LTV max, 25-year amortization, no insurance, but requires higher rates and stronger DSCR. MLI Select is better for capital-constrained buyers; conventional works when you have larger down payments and want to avoid insurance costs.
Choose MLI Select when: you want minimal down payment (5% vs 25%), prefer lower monthly payments and better cash flow, or your property qualifies for affordability/energy/accessibility commitments. The 95% LTV and extended amortization reduce monthly debt service significantly. Conventional is better when you have capital available and want to avoid insurance premiums.
MLI Standard is CMHC's base multifamily program: 85% LTV, 40-year amortization, mortgage insurance required, no point system. It's the middle ground between MLI Select (95% LTV with points) and conventional (75% LTV, no insurance). Most properties fit MLI Standard if they don't qualify for MLI Select points.
Yes, insurance premiums are added to your loan amount at closing, not charged annually. For example, a $2M loan at 95% LTV with 4% insurance adds $80,000 to the financed amount. This improves the upfront cash requirement but increases total interest over the loan term.

Financing Terms & Costs

MLI Select standard rental needs 1.10x DCR. MLI Standard is 1.30x on a 5-year term and 1.20x on a 10-year term. Conventional lenders typically require 1.20–1.30x. This calculator shows your DSCR so you can see if you meet those minimums.
CMHC insures the lender's risk, so they're comfortable offering lower rates. With conventional financing, the lender bears all risk, so they charge higher rates to compensate. This rate difference can save thousands in interest over 5–10 years with CMHC programs.
Savings depend on your situation. On a $2.5M property purchase, MLI Select vs conventional can save $150–$300+ monthly in debt service. Over 5 years, this could be $9,000–$18,000+. Use this calculator with your actual property details to see precise savings for your deal.
Yes, you can refinance from conventional to CMHC MLI if rates drop or your property improves (especially if it now qualifies for MLI Select). Refinancing has closing costs, so you'd want a meaningful rate reduction or term benefit to justify it.

Cash Flow & Investment Returns

Cash-on-cash return is your annual cash flow divided by your actual down payment. It shows the percentage return on your invested capital. For example, if you put down $150,000 and receive $12,000 annual cash flow, your cash-on-cash return is 8%. Higher cash-on-cash returns (6–10%+) indicate strong investment performance.
Lower monthly payments directly increase annual cash flow. MLI Select's 95% LTV and extended amortization can reduce monthly debt service by $200–$500+ compared to conventional. On a $2.5M property, this compounds to $24,000–$60,000+ additional annual cash flow, dramatically improving investment returns.
NOI is gross rental income minus operating expenses (property taxes, insurance, maintenance, etc.). Lenders use NOI to calculate your DSCR. Higher NOI improves your DSCR and qualification strength. This calculator uses your entered NOI to show how well each financing option performs.
Total interest directly impacts long-term profitability. A 50-year amortization spreads payments over longer, reducing monthly costs but increasing total interest paid. Over 25–30 years (typical holding period), understanding interest cost helps you evaluate long-term wealth building and refinancing opportunities.

Qualifying & Application Process

Both require: property appraisal, recent financial statements, T1 Generals or business tax returns, rent roll and lease agreements, property tax and insurance statements, and proof of liquid reserves. MLI Select may require additional documentation for affordability, energy, or accessibility commitments.
Typical timeline is 10–15 business days from complete application to approval. MLI Select may take slightly longer due to point verification and commitment documentation, but not significantly. Having all documents organized upfront accelerates the process.
Standard deductible expenses include: property taxes, insurance, utilities (if landlord-paid), maintenance and repairs, property management (typically 4–8% of rent), landscaping, pest control, and capital reserves (3–5%). Don't include debt service, principal repayment, or major renovations in NOI calculations.
Yes. Pre-approval letters are available for both CMHC and conventional financing. With CMHC, you may get conditional pre-approval without a specific property. Conventional lenders may require property details. Pre-approval strengthens your offer to sellers and shows your financing is solid.

Specific Scenarios

Absolutely. PBRs with affordability components often score well for MLI Select points, unlocking 95% LTV and potentially 50-year amortization. This significantly improves cash flow. Run this calculator with your property details and compare to conventional to see the advantage.
Not necessarily. Even with 40% down, you could use CMHC at 60% LTV (40% down) and avoid insurance entirely. Compare both: CMHC allows better terms (longer amortization, lower rates), while conventional gives you flexibility in structuring. Use this calculator to compare both scenarios.
At 1.15x, MLI Select standard rental (1.10 min) is the CMHC path that still clears. MLI Standard needs 1.30x (5-year) or 1.20x (10-year). Conventional lenders typically want 1.20–1.30x, so a 1.15x file is usually Select-only.
Yes. If you originally used conventional financing and your property now qualifies for MLI Select (or you just want to access CMHC rates and terms), you can refinance into CMHC MLI or Standard. Closing costs apply, but the monthly savings could justify it.

Advanced Topics

MLI Select (95% LTV) requires less down payment, preserving capital for other investments while maintaining good cash flow. Over 10 years, lower debt service plus preserved capital compounds significant wealth advantage. Conventional (75% LTV) ties up more capital upfront but avoids insurance. The 'best' depends on your investment strategy and capital availability.
CMHC and conventional rates sometimes move differently. CMHC may have more stable pricing tied to government rates, while conventional can be more volatile. During rising rate environments, CMHC may become more attractive. This calculator uses your current assumptions, but sensitivity test by adjusting rates to see impact.
This calculator uses static income and expenses for today's economics. In reality, rents grow 2–3% annually and expenses inflate similarly. Conservative analysis uses current numbers (as shown here), but you may model growth separately to project 5–10 year returns and long-term wealth building.
MLI Select commitments are binding (typically 5–7 years for affordability/energy/accessibility). This might affect future buyers' flexibility, but purpose-built rentals and value-add properties with these features often trade at premiums. Plan for long-term hold or ensure exit buyers align with your commitment type.
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