There are many types of loans, leasing and mortgage deals in the lending industry today to cater to the different needs of the consumers. There is a plethora of items that are purchased or desired by different consumers which need some form of financial assistance.

Clients

Besides the common car and housing loans and leasing, a chattel mortgage caters to a different group of consumers who need financing assistance. This type of loan allows different businesses to enjoy a cheap motor loan. A chattel mortgage is often offered to sole proprietors, small to medium corporations and even to large corporations for any motor vehicle loan.

Businesses that are planning to renew or replace any of their corporate vehicles should consider a chattel mortgage to their advantage as it gives them higher savings.

A chattel mortgage can benefit sole proprietors with an ABN if such traders are seeking a new car to be used in boosting their business opportunities.

Advantages

There are certain advantages to a chattel mortgage that prompt many corporate takers. A chattel mortgage allows a wider spread of repayment for the loan taken out on the vehicle. Structured payments are made with lower repayment amounts that will ease the cash flow of the business.

However, there are certain qualifications to be met to enjoy a chattel mortgage; the vehicle to be financed must be allotted for at least 50% business use; the repayments must be regular as in monthly payments that are prompt. Companies seeking a chattel mortgage should have a good credit standing.

There are usually no exit fees for a chattel mortgage. Companies do not have to pay any early termination fees if they wish to settle the loan earlier.

Any experienced and professional chattel mortgage provider would discuss the loan terms professionally with the purchaser so that the loan would be suited to the consumer’s requirements.

A chattel mortgage benefits those who want a fast and smooth processing loan for their vehicles without too much documentation involved.

Tax implications

Although there are many advantages to a chattel mortgage, there are also possible tax implications attached depending on the type of business car loans. There may be a GST on top of the interest incurred which can be claimed under deductions.

The qualified and experienced accountant or any tax consultant would be able to advise the consumer about the relevant tax benefits.

A chattel mortgage allows one to own the vehicle immediately while regular payments are made.

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