Stepping into the world of multi-family investing is exciting, especially in a growing market like Calgary. But if you’re looking to buy your first 12-unit apartment building, one of the biggest questions you’ll face is how to finance it. Do you go the traditional mortgage route or take advantage of CMHC-insured financing programs like MLI Select?
Let’s break down both options so you can make a smart, strategic decision that fits your long-term goals.
Option 1: Traditional Commercial Mortgage
How it works:
This is the classic route usually offered by a bank or credit union. You’ll typically need:
- 25–30% down payment
- 25-year amortization
- Higher debt coverage ratio (DCR) requirements
- No insurance premiums, but higher monthly payments
Pros:
- Faster processing and approvals
- More lender flexibility
- Better for shorter-term holds or value-add projects
Cons:
- High down payment = more upfront capital needed
- Shorter amortization = higher monthly payments
- May limit your ability to scale quickly
Option 2: CMHC-Insured Financing (e.g., MLI Select)
How it works:
Backed by the Canada Mortgage and Housing Corporation, this program is designed for long-term, sustainable rental housing. Qualifying properties may get:
- As little as 5% down
- Amortization periods up to 50 years
- Lower interest rates
- Insurance premiums rolled into the loan
Pros:
- Lower upfront capital = entry with less cash
- Longer amortization = dramatically lower monthly payments
- Helps properties qualify more easily under debt service ratios
Cons:
- Longer approval timelines (90+ days in some cases)
- Stricter building and operational requirements
- Insurance premiums add to the total loan cost over time
A Quick Example:
Let’s say you’re buying a $3 million 12-unit building in Calgary.
| Financing Type | Down Payment | Monthly Mortgage (est.) | Amortization | Notes |
| Traditional | $900,000 (30%) | ~$14,000 | 25 years | High cash needed |
| CMHC-MLI Select | $150,000 (5%) | ~$8,500 | 50 years | Lower monthly cost, long-term play |
What Makes Sense for You?
If you’re a newer investor with limited capital but a strong long-term vision, CMHC might give you the leverage to enter the market. If you’re more focused on flipping, renovating, or faster cycles, traditional financing might give you the speed and flexibility you need.
Regardless of your choice, always consider:
- Cash flow stability
- Future refinancing potential
- Exit strategy
At Green Casa Property Management, we work closely with Calgary investors from first-timers to seasoned prosand we can connect you with trusted mortgage brokers, lenders, and underwriters to help navigate the financing maze.
Your next apartment deal might be closer than you think.
