What is a chattel mortgage?

A quick overview

Chattel mortgage – A loan that is secured by the asset you purchase.

This is one of the most common types of asset finance arrangement. Businesses own the asset from the start of the loan term but the lender holds a mortgage over the asset as security. It is very similar to a mortgage for residential property but applied to business assets. The reason it is so popular is that the asset is owned by the business which means it is on their balance sheet and GST, depreciation, and interest payments are tax-deductible.