Chattel mortgage
You own the asset from the start and the lender holds security over it. Popular with owners who want the asset in the business name.
Own it from day one
Chattel Mortgage for Australian Businesses
Buy the vehicle or machine in your business name, take it home straight away and pay it off over a term that suits your cash flow.
How it works
What is a chattel mortgage, in plain English?
A chattel mortgage is a business loan used to buy a movable asset, such as a ute, truck, excavator, coffee machine or CNC router. Your business owns the asset from the day of purchase, and the lender takes a mortgage over that asset as security until the loan is repaid.
Because the asset itself backs the loan, lenders can often look at a chattel mortgage more quickly than an unsecured loan. Once the final repayment is made, the lender's interest is removed and the asset is yours with nothing owing on it.
It is one of the most common ways Australian businesses fund vehicles and gear, and it often suits owners who want the asset on their own balance sheet. If you are still weighing up structures, our guide to equipment lease versus loan sets the options side by side.
A chattel mortgage is a secured business loan for buying equipment or vehicles, where your business owns the asset from day one and the lender holds a mortgage over it until the loan is repaid. Repayments are fixed over an agreed term, an optional balloon can lower them, and next-business-day settlement is possible for straightforward applications.
Know your options
Chattel mortgage compared with the alternatives
Each structure handles ownership and repayments differently, so the right pick depends on how you run your business.
Finance lease
The lender owns the asset and you lease it for a set term, usually with a residual at the end. You can then pay out, refinance or hand it back, depending on the agreement.
Hire purchase
The lender buys the asset and hires it to you, with ownership passing once the final instalment is paid. Less common now, but still offered for some assets.
How fast can a chattel mortgage settle?
Speed mostly comes down to paperwork. When the tax invoice or dealer quote, your ID and recent business bank statements are ready, approval and settlement can move fast, and next-business-day settlement is possible for straightforward applications.
Picture a landscaper whose tipper died on a Tuesday with three jobs booked for the following week. With a dealer quote in hand and statements downloaded, a chattel mortgage can be one of the quicker paths to getting a replacement on the road. For more on time-critical purchases, see urgent equipment finance.
What can you buy with a chattel mortgage?
Almost any identifiable, movable asset used mainly for business can be considered. Lenders like assets with a serial number, VIN or clear resale market, because that is what gives the security its value.
- Utes, vans, cars and light commercial vehicles
- Trucks, prime movers and trailers
- Earthmoving, construction and agricultural machinery
- Forklifts and warehouse gear
- Commercial kitchen, medical and manufacturing equipment
- New or used assets, from a dealer or, in many cases, a private seller
How does a balloon payment work?
A balloon (sometimes called a residual) is a lump sum left owing at the end of the term. Setting one lowers your regular repayments, which can help cash flow while the new asset starts earning its keep.
The trade-off is that you will owe that amount at the end, and you will usually pay more interest overall because the balance stays higher for longer. Many owners plan to sell, trade in or refinance the asset when the balloon falls due. Choose a figure you are comfortable with, not just the biggest one offered.
Apply today… cashed up tomorrow!
Need the gear on site this week?
Start the 60-second enquiry now. When your documents are ready and the deal is straightforward, being cashed up as soon as tomorrow is possible for eligible applicants.
What about GST and tax on a chattel mortgage?
Because your business owns the asset, a GST-registered business may be able to claim the GST included in the purchase price on its BAS, and interest and depreciation may be deductible. How this applies depends on your structure, how you report GST and how much the asset is used for business.
Tax rules, including any asset write-off settings, change from year to year. Talk to your accountant before you sign so you know how the purchase will land in your books, especially around EOFY.
Can I get a chattel mortgage if my credit isn't perfect?
Often, yes. Because the asset secures the loan, some lenders will look past older defaults or a patchy history if the business is trading well and the explanation makes sense. A larger deposit or trade-in can also help.
If you know there are marks on your file, say so up front. Our page on bad credit equipment finance explains what lenders tend to weigh up, and low doc equipment finance covers options if your tax returns are behind.
What do I need to apply?
Getting these together before you enquire is the single best way to speed things up. Every application is subject to lender approval, but having everything ready removes most of the back-and-forth.
- Tax invoice or quote showing the asset, seller and price
- Driver licence for each director or owner
- ABN and, for companies, the ACN
- Recent business bank statements
- Details of any trade-in or deposit
Ready to get the gear moving?
Tell us what you are buying and when you need it. There is no credit check when you first enquire, a real person looks over your situation, and your details are not sprayed out to a pile of lenders.
Please fill in the form accurately so we can match you first time. You can start the 60-second enquiry now, or read more about equipment finance first.
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Australian business context
Enquiries can include ABN, BAS, ATO, bank statement and asset details where relevant.
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Approval, pricing, loan amounts and funding times depend on lender assessment.
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Loanster helps identify what information may be needed before a lender can make a decision.
Common questions
Chattel Mortgage FAQs
Who owns the asset under a chattel mortgage?
Your business owns it from the day you buy it. The lender registers a security interest over the asset until the loan is fully repaid, and that interest is then removed.
Is a chattel mortgage better than a lease?
Neither is better for everyone. A chattel mortgage suits owners who want the asset in the business name, while a lease can suit those who prefer to upgrade regularly. Your accountant can tell you which fits your tax position.
Can I use a chattel mortgage for a used vehicle?
Yes. Many lenders fund used vehicles and equipment, including some private sales, though age limits and inspection requirements can apply. A clear invoice and the VIN or serial number help.
Do I need a deposit for a chattel mortgage?
Not always. Some applicants can borrow the full purchase price, while others may be asked for a deposit or trade-in depending on credit history, time in business and the asset itself.
Can I pay a chattel mortgage out early?
Usually, yes, though some contracts carry early payout costs. Ask about payout terms before you sign so there are no surprises if you sell or upgrade.
How quickly can I get approved?
Straightforward applications with the invoice, ID and bank statements ready can move very quickly, and next-business-day settlement is possible. Missing paperwork is the most common cause of delay.
Related finance options
Explore connected Loanster pages
Equipment Finance for Australian Businesses
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Equipment Lease vs Loan: Which Suits Your Business?
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Fast Equipment Finance: Same Day Decisions, Next Day Settlement
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Equipment Finance Checklist: Everything You Need to Get Approved
A practical checklist to work through before you finance a truck, machine, oven or forklift, so approval and settlement move quickly.
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Last reviewed: 24 October 2026
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