Chattel mortgage · Manufacturing
Chattel mortgage for manufacturing
Manufacturing finance is capital equipment lending combined with working capital for raw materials, covering CNC machines, presses and packaging lines as well as the gap between buying stock and being paid for finished goods.
How a chattel mortgage works for manufacturing
For a GST-registered manufacturer a chattel mortgage over a press, router or packaging line means ownership from settlement and a GST claim on the full purchase price in the next BAS. On a $400,000 machine that is a meaningful cash injection at the exact moment you have just committed capital. Depreciation and interest are deductible. It is the standard structure for plant you intend to run for a decade, which describes most Australian factory equipment — machines here are typically kept far longer than the finance term.
The cash-flow pattern we plan around
Cash out for raw materials, then weeks of work in progress, then 30–60 day terms on finished goods — a cycle that lengthens as the business grows.
What manufacturing typically fund
- CNC machines, lasers and press equipment
- Packaging and materials handling lines
- Raw materials and imported componentry
- Forklifts and factory logistics
- Factory fit-out, power upgrades and compliance works
Chattel mortgage for manufacturing: the numbers
| Typical amounts | $10,000 – $2,000,000 |
|---|---|
| Term | 12–84 months |
| Indicative rates | 6.9% – 14.5% p.a. |
| Repayments | Monthly (weekly or fortnightly available) |
| Speed | 24–48 hours for low-doc up to $150k; longer for full-doc |
| Documents manufacturing usually need | ABN, GST registration and two years of financials · Supplier quote or proforma invoice for the machine · Debtor ledger and aged receivables report |
Rates shown are indicative ranges observed across our lender panel for the period stated. They are not an offer or quote. Your rate depends on your business, the lender, the amount, the term and the security offered. The lender makes the final credit decision.
Key terms
Manufacturing equipment finance
Manufacturing equipment finance is secured lending for production machinery such as CNC machining centres, laser cutters and packaging lines, often structured to fund supplier progress payments and to commence repayments on commissioning.
Working capital cycle
The working capital cycle is the time between paying for raw materials and receiving payment for the finished goods made from them, during which the business funds the value of that inventory itself.
What is a chattel mortgage?
A chattel mortgage is a business loan used to buy a movable asset (a chattel) such as a ute, truck, excavator or equipment. The business takes ownership immediately and the lender registers a security interest over the asset until it is paid off.
Chattel mortgage balloon payment
A balloon is a lump sum, typically 0–40% of the purchase price, paid at the end of the term. It lowers regular repayments but must be paid, refinanced or covered by selling the asset when the term ends.