Chattel Mortgage Finance

With a Chattel Mortgage Agreement, the financier lends you the money to buy the goods in your name and secures its loan by registering a charge over the goods. You repay the loan over a period of time and upon making your last payment, the financier removes their charge over the goods.

Because you own the goods, you can reduce the amount being borrowed by making a deposit.

The loan requires you to pay the full amount over the term or you can have a Balloon Payment due at the end that should reflect the market value of the goods.

For accounting purposes, you claim the GST on the purchase price, the interest on the loan and the depreciation of the goods through your Profit & Loss Statements.