01
The most important distinction: program, insurance, or lender product
ACLP is a direct CMHC loan program. MLI Select is CMHC mortgage loan insurance arranged through an approved lender. Conventional and bridge/private loans are lender products whose terms depend on the lender and file. Calling all four “CMHC options” or comparing only their quoted rates obscures who supplies the money and what has to happen before funding.
A route can also change during the project. A borrower may use conventional or private acquisition debt, ACLP or another facility for construction, and MLI Select or conventional debt at stabilization. The transitions need to be designed as one capital plan.
Sources: Canada Mortgage and Housing Corporation; Canada Mortgage and Housing Corporation
02
MLI Select: insured flexibility tied to measurable commitments
MLI Select applies to eligible new and existing multi-unit projects and uses points for affordability, energy efficiency, and accessibility. As of this review, eligible projects generally require at least five units, and non-residential space must remain within CMHC’s stated limits.
CMHC’s current public table shows new-construction flexibilities beginning at 50 points with up to 95% loan-to-cost, minimum 1.10 debt coverage for standard rental, and up to 40-year amortization. At higher point levels, amortization may extend to 45 or 50 years and limited-recourse treatment may become available. For existing properties, the table shows up to 85% loan-to-value at 50 points, up to 95% at 70 points, and amortization increasing by points to as much as 50 years.
These are ceilings and flexibilities, not automatic proceeds. The approved lender and CMHC still assess valuation, income, borrower, property, documentation, and the claimed commitments. Affordability commitments generally last at least 10 years; a 20-year commitment currently earns additional points.
Current-rule note: CMHC also publishes annual rules for certain affordability rent increases. For any live file, verify the current year’s program page and compliance documents rather than copying an older model.
03
ACLP: construction through stabilized operations
The Apartment Construction Loan Program provides direct low-cost financing for eligible rental construction and certain conversions. CMHC states that the program is open for applications and that standard-rental loans begin at $1 million for projects with at least five rental units.
Current public features include a fixed rate locked at first advance, potential amortization up to 50 years, up to 100% loan-to-cost for residential space and 75% for non-residential space depending on application strength, interest-only treatment through construction and stabilization mechanics, monthly construction draws, and integrated CMHC mortgage insurance.
Eligibility also includes supply, residential-use, viability, documentation, and affordability requirements. CMHC currently requires the standard-rental affordability commitment for at least 10 years. Projects are prioritized, then proceed through conditional approval, external underwriting, term sheet, loan agreement, and advances. At the end of the term, the borrower must arrange take-out with a CMHC-approved lender.
04
Conventional: lender policy without a social-outcome program
Conventional financing can fund acquisition, construction, or permanent debt when a bank, credit union, or institutional lender is satisfied with the borrower, property, cash flow, value, equity, recourse, and timing. There is no single conventional term sheet for the Ontario market.
It may be a better fit when the requested leverage is moderate, the property is already stable, program timing is too long, or the borrower does not want to undertake program commitments. It may be a poor fit when the asset is transitional, the requested proceeds exceed lender policy, construction risk is unresolved, or recognized NOI is not yet established.
Compare debt coverage, amortization, term, recourse, prepayment, annual review, reserves, security, reporting, and refinance flexibility. A faster approval is not the same as an unconditional or certain closing.
05
Bridge/private: buy time only when the fix is measurable
Bridge capital is useful when the property or timing does not fit permanent financing today—for example, a rapid acquisition, renovation, vacancy, lease-up, incomplete records, or an expiring loan. The lender may be a bank, debt fund, mortgage investment corporation, company, or individual; “bridge” describes the job, not one standardized product.
FSRA’s Ontario consumer guidance says alternative/private mortgages are generally short-term, can carry higher interest and fees, and are often interest-only. It emphasizes full cost disclosure and a realistic exit strategy. Sophisticated commercial borrowers should apply the same discipline: model the maturity balance, extension terms, default remedies, and permanent-lender timeline before closing.
Bridge/private is usually a poor fit when the exit depends only on appreciation, unspecified refinancing, perfect future occupancy, or new equity that has not been committed.
06
A borrower’s route test
Answer these questions before requesting quotes. They reveal which route is structurally plausible and which is only attractive in a headline comparison.
- Is the request for acquisition, construction, stabilization, or permanent debt?
- Is the property already producing lender-recognizable stabilized NOI?
- Can the borrower document and maintain affordability, energy, or accessibility commitments?
- Does the closing date allow program application, underwriting, legal, and funding?
- How much recourse, reporting, reserve control, and prepayment restriction is acceptable?
- What is the all-in cost through the expected hold period, including premiums and fees?
- What happens if costs rise, lease-up slows, or permanent proceeds fall?
07
Compare offers on one page
Build a common comparison using the same cost budget, NOI, valuation, closing date, and downside assumptions. Do not let each quote use a different version of the project.
| Economics | Execution | Long-term obligations |
|---|---|---|
| Gross and net proceeds | Approval and funding path | Affordability or other commitments |
| Rate basis and interest reserve | Required reports and third parties | Recourse and guarantees |
| Insurance premium and lender fees | Draw and equity mechanics | Ongoing reporting and reserves |
| Amortization and payments | Conditions and timing risk | Prepayment, refinance, and sale flexibility |
| Extension and default costs | Fallback if the target close slips | Maturity and take-out requirements |