Common Questions About the MLI Select Program in Alberta

mli select investors



What is the MLI Select Program?

MLI Select is a CMHC (Canada Mortgage and Housing Corporation) program that offers insurance incentives for multi-unit residential properties. It uses a point system based on affordability, energy efficiency, and accessibility commitments. It allows you to purchase 5 or more “doors”, that have to be side-by-side, for only 5% downpayment and on a 50 year mortgage for those who qualify.

What is the net worth requirement for CMHC MLI Select?

Your net worth must be at least 25% of the property’s purchase price. For example, for a $2 million property, your net worth must be at least $500,000.

What is the minimum property size eligible for MLI Select?

The minimum property size is 5 units. This can be achieved by purchasing a multi-family unit or multiple adjacent properties (e.g., three detached homes, each with legal suites).

How does the MLI Select point system work?

The program uses a point system based on commitments to affordability, energy efficiency, and accessibility. The more points you accumulate, the better the affordable housing incentives. You can focus on a single area or combine commitments to increase your points.

What are the key criteria for qualifying for MLI Select?

Key criteria include:

  • Net worth requirement (25% of property value)
  • Liquidity requirement (10% of property value in liquid assets)
  • Proximity to property (living within commutable distance preferred)
  • Minimum property size of 5 units
  • Debt Service Coverage Ratio (DSCR) of 1.1 or higher2

Is it hard to get CMHC approval for MLI Select?

While the process can be complex, approval is achievable if you meet the criteria and provide thorough documentation. The application review process typically takes 4-6 weeks, with potential requests for additional information.

What is the difference between RCFI and MLI Select?

While both are CMHC programs, MLI Select specifically focuses on multi-unit properties with an emphasis on affordability, energy efficiency, and accessibility. RCFI (Rental Construction Financing initiative) is geared towards new construction of rental housing.

What are the benefits of using MLI Select for multi-unit properties in Calgary?

Benefits include:

  • Access to reduced premiums
  • Longer amortization periods
  • Ability to purchase properties with as little as 5% down payment
  • Potential for 50-year amortization

How long does the MLI Select application process typically take?

The application review process typically takes 4-6 weeks, though this can vary depending on the complexity of the project and the completeness of the application.

What documentation is required for an MLI Select application?

Required documentation includes:

  • Valuation report
  • Mortgage insurance details
  • Amortization schedule
  • Energy efficiency assessment
  • Financial statements
  • Market analysis
  • Project overview4

Can out-of-province investors qualify for MLI Select in Calgary?

Yes, but CMHC favors investors who live within a commutable distance from their investments. Out-of-province investors can partner with someone locally to meet this requirement.

How does MLI Select impact down payment requirements?

MLI Select can allow investors to purchase multi-unit properties with as little as 5% down payment, significantly lower than traditional financing options.

What types of properties are eligible for MLI Select in Calgary?

Eligible properties include new and existing affordable, energy-efficient, and/or accessible housing projects such as standard rental housing, single room occupancy (SRO), supportive housing, and retirement homes. Student housing projects are only eligible under energy efficiency and accessibility criteria.

How does MLI Select address affordability in Calgary's real estate market?

MLI Select encourages affordability by offering better incentives for projects that provide a higher percentage of units with rents at or below established thresholds. For example, offering 25% of units at a maximum of 30% of median renter income can earn 100 points in the program’s scoring system.

What energy efficiency measures are considered in MLI Select applications?

Energy efficiency measures considered include high-efficiency HVAC systems, LED lighting, advanced insulation, and solar panels. These measures are evaluated based on their expected annual savings and environmental impact.

Are MLI Select Projects open to international collaborations?

While MLI Select is primarily designed for Canadian investors, international collaborations may be possible. However, CMHC favors investors who live within a commutable distance from their investments. International investors might need to partner with local entities to meet this requirement

What is the process for applying for MLI Select in Calgary?The application process for MLI Select in Calgary involves:

  • Creating an account on the CMHC application portal
  • Completing the application form with detailed project information
  • Uploading required supporting documents
  • Submitting the application for review
  • Responding to any requests for additional information
  • Awaiting final approval and finalizing agreements with CMHC

How do I track the status of my MLI Select Projects application?

You can track the status of your MLI Select application through the Canada Mortgage and Housing Corporation application portal. After submitting your application, you’ll receive updates on its progress, including any requests for additional information

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