Updates to CMHC Multi-Unit Mortgage Loan Insurance

Updates to CMHC Multi-Unit Mortgage Loan Insurance

CMHC Announces Major Financing Changes – Effective July 14

Highlights

1. Advice 263 – Rental achievement holdbacks will no longer be a policy requirement for MU loan applications submitted under the MLI market rental product. Therefore, loans can be advanced up to 85% of the loan-to-cost/loan-to-value (whichever is less) without the need for a rental achievement holdback. This change applies to all loan purposes under the MLI market rental product. For loan applications submitted under the MLI Select product, in alignment with current policy, a rental achievement holdback may still be applied depending on the characteristics of the application.

2. Advice 264 Specific premium rates will apply to both the Market Rental and MLI Select products based on the Loan-to-Value (LTV) ratio, as determined by CMHC, and the loan purpose, i.e., construction financing or all other loan purposes (purchase or refinance of existing properties and completion take-outs). Two premium schedules will be in place based on shelter types i.e., standard rental housing or all other shelter models (single room occupancy, student housing, retirement homes and supportive housing).

Surcharges will apply to both the Market Rental and MLI Select products based on loan characteristics. A new surcharge will apply where effective gross income is not met at the time of first advance. All surcharges are in addition to the base premium unless otherwise noted.

A new premium discount schedule will apply to all MLI Select applications where borrowers commit to affordability, energy efficiency and/or accessibility outcomes. The size of the discount increases with the number of points awarded and applies to the base premium plus any applicable surcharges.

Advice 264 – Summary of Changes

Structure of Premium Schedules

Existing (Current) Structure:

1. Premium rates are based on:
   1. Loan Purpose (purchase, refinance, or construction of multi-unit buildings of 5+ units)
   2. Product Type (Market Rental vs. MLI Select)
   3. Effective Gross Income (EGI) Status – Two tiers:
      1. EGI met: rent levels at underwriting have been achieved
      2. EGI not met: rent levels not yet achieved

Updated (Effective July 14):

1. Premium rates are now determined by:
   1. Loan-to-Value (LTV) ratios
   2. Loan Purpose (purchase, refinance, or construction of multi-unit buildings of 5+ units)
   3. Shelter Type (Standard, single room occupancy, student housing, retirement homes and supportive housing)
2. Surcharges now include:
   1. Effective Gross Income surcharge - 0.25% of the net loan amount will apply where effective gross income is not met at the time of first advance.
3. MLI Select Discount Schedule:
   1. A premium discount schedule will apply to all MLI Select applications where borrowers commit to affordability, energy efficiency and/or accessibility outcomes. The size of the discount increases with the number of points awarded and applies to the base premium plus any applicable surcharges.

LTV and Premium Rate Comparison

Standard Rental Housing (Existing vs. Updated)

All Other Shelter Models

Includes: Single Room Occupancy, Student Housing, Retirement Homes & Supportive Housing.

MLI Select Discount Schedule

Implementation and Effective Date

The above noted policy changes are effective July 14, 2025, and will be applied to applications submitted on or after the effective date.

For more information on this announcement, or to discuss any of your financing needs, please contact your CMLS Origination expert today.