Chattel Mortgage

What is a chattel mortgage?

A Chattel Mortgage is a finance product that enables a customer to take ownership of a commercial use chattel (car, truck etc) at the time of purchase. The financier then takes a mortgage over the chattel as security for the loan and registers their interest with PPSR. Upon full payment of the finance contract this security interest is removed and the customer takes full and clear title over the chattel.

Some benefits of a chattel mortgage for suitable customers can be:

• Flexible loan terms available from 2 to 7 years
• The ability to contribute a deposit and also add a residual value to tailor payments to suit
• Available to company, partnership and sole trader applicants provided the chattel is for business use
• A tax deduction if the chattel is used for business purposes*
• An input credit on a customers next BAS (Business Activity Statement) may be claimed for the GST on the chattel purchase price if they are registered for GST *
• A large depreciation claim on the purchase price of the chattel may be claimed by eligible customers as ownership of the chattel is immediate*
• No GST is paid on the monthly payments or any balloon/residual added to the structure of the loan*

(*please refer to your accountant or tax specialist to check eligibility)

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