Chattel Mortgage for Freight Companies: A Smart Financing Option!

For freight and logistics companies, having the right trucks and equipment is essential for smooth operations. However, purchasing commercial vehicles outright can put a strain on cash flow. This is where a chattel mortgage can be a smart financing option, allowing freight businesses to own the vehicles they need while enjoying tax benefits and flexible repayment terms.

In this guide, we’ll describe how a chattel mortgage functions, its advantages for freight companies, and how to secure the best financing option.

What is a Chattel Mortgage?

A chattel mortgage is a type of business loan used to finance vehicles and equipment. The term "chattel" refers to the asset being financed (such as a truck or trailer), while "mortgage" refers to the lender holding security over the asset until the loan is fully repaid.

Unlike leasing, a chattel mortgage gives the borrower immediate ownership of the asset, while the lender registers a mortgage over it as security. Once the loan is paid off, the mortgage is removed and the asset is fully owned by the business.

Benefits of Chattel Mortgage for Freight Companies

Immediate Ownership – Your company owns the vehicle from the start, unlike leasing where the lender retains ownership.

Tax Benefits – Businesses can claim GST on the purchase price, as well as depreciation and interest costs.

Flexible Loan Terms – Choose repayment terms that suit your cash flow, typically 1 to 7 years.

Balloon Payment Options – Reduce monthly repayments by opting for a lump sum balloon payment at the end of the loan term.

Competitive Interest Rates – Lower rates compared to unsecured loans because the vehicle serves as security.

How Freight Companies Can Use a Chattel Mortgage

Freight businesses can use a chattel mortgage to finance:

🚚 New or Used Trucks – Semi-trucks, prime movers, rigid trucks and more.

📦 Trailers & Containers – Refrigerated trailers, flatbeds or curtain-sided trailers.

🏗 Heavy Equipment – Forklifts, cranes and other transport machinery.

⚙ Fleet Expansion – Add more vehicles to meet business growth demands.

A chattel mortgage enables you to acquire the necessary assets without significant initial expenses, ensuring your business operates smoothly.

Eligibility for a Chattel Mortgage

To qualify for a chattel mortgage, most lenders require:

An active ABN (Australian Business Number)

GST registration (In most cases)

The vehicle or equipment to be used for business purposes (50% or more)

Proof of business income (Bank statements, BAS, or financials)

A good credit score (For better interest rates)

If you’re a sole trader, contractor, or new business, low-doc or no-doc chattel mortgage options may also be available.

How to Apply for a Chattel Mortgage

The process of getting a chattel mortgage is quick and straightforward:

Select the vehicle or equipment necessary for your freight business.
Apply for financing through a lender or broker.
Provide the required documents, including business information and bank statements.
Receive approval and sign the loan contract.
Acquire the asset and make fixed repayments.

Most applications are processed within a few days, making it a fast and efficient way to finance your freight business.

Why Choose Proactive Lending Solutions?

At Proactive Lending Solutions, we focus on chattel mortgage financing for freight and transport companies. We can identify the best financing option tailored to your requirements :

Expert guidance on loan structuring to optimize tax advantages
Quick approvals with minimal documentation
Adaptable repayment options to fit your cash flow
Competitive interest rates from reputable lenders
Financing solutions for sole traders, contractors, and fleet operators

Need finance for your freight business? Let’s make it happen!

📞 Call Shaun: 0424 513 740

📧 Email: info@proactivelending.com.au

🌐 Apply now: www.proactivelending.com.au