By the Loan Phone team Reviewed by Anthony Moncada, M.App.Fin, Cert IV Finance & Mortgage Broking
Chattel mortgage rates Australia wide typically start from around 6.3% p.a. for strong applicants, with many deals falling in the 7–12% p.a. range and specialist cases extending to 20% p.a. or higher as of August 2026. Rates depend heavily on your business’s trading history, financial strength, credit profile, and the asset type (indicative only). Established businesses with 2+ years of trading and strong financials may access the lowest rates, while newer businesses, those with less established financials, or those financing older/specialist assets often see higher rates.
Actual rates require individual assessment. Modern comparison platforms allow businesses to receive personalized rate quotes from a large panel of lenders efficiently, ensuring you find an optimal rate.
| Business Profile & Asset Type | Indicative Rate Range | Key Considerations |
|---|---|---|
| Established (2+ years, strong) for New Passenger Vehicles | 6.3-8.5% p.a. | Lowest risk, strong financials, new asset |
| Established (2+ years, strong) for New Commercial Assets & Standard Equipment | 7-10% p.a. | Good financials, standard new commercial assets |
| Standard (1-2 years trading) for Used Commercial Vehicles | 9-14% p.a. | Moderate risk, asset age and condition influence rate |
| Established/Standard for Trucks & Prime Movers | 8-15% p.a. | Higher value assets, specific industry considerations |
| Developing or Higher Risk Profile for Older or Specialist Equipment | 12-20%+ p.a. | Higher risk, older assets, unique or niche equipment |
All rate ranges are indicative examples only and depend on individual circumstances, including credit profile, asset age, loan term, deposit amount/LVR, ABN/GST tenure, and lender policy.
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Understanding Chattel Mortgage Rates
Chattel mortgage rates are the annual interest charged on funds borrowed to purchase a business asset. Unlike a fixed price, rates are tailored to each borrower based on a lender’s risk assessment. This means two businesses buying identical equipment may receive different rates. For more detail, see our complete chattel mortgage guide.
Factors Affecting Your Rate
Your interest rate is determined by a combination of factors, including:
- Business Trading History: Lenders prefer at least 1-2 years of history.
- Financial Strength: Strong revenue and cash flow lead to better rates.
- Credit Profile: Both business and director credit scores are assessed.
- Asset Type & Age: New, standard assets typically receive lower rates than older, specialist equipment.
- Loan Structure: The deposit amount, loan term, and loan size all influence the final rate.
Rate Comparison: Banks vs Specialists
Different types of lenders cater to different business profiles, which is reflected in their rate ranges.
| Lender Type | Indicative Rate Range | Target Market |
|---|---|---|
| Major Banks | 6.3-11% p.a. | Established businesses with strong financials |
| Specialist Lenders | 9-18% p.a. | Broader market, including developing businesses and some higher-risk profiles |
| Non-Bank Lenders | 10-20%+ p.a. | Alternative lending, varied credit accepted, includes higher-risk/specialist deals |
Fixed vs Variable Rates
The vast majority of chattel mortgages in Australia use fixed interest rates. This provides certainty for your business by locking in your repayment amount for the entire loan term, protecting you from market fluctuations. Variable rates are uncommon for this type of finance.
Total Cost Considerations
The interest rate is only one part of the total cost. When comparing loans, always consider:
- Fees: Establishment fees, monthly account fees, and PPSR registration costs.
- Loan Structure: How the term length and balloon payment affect the total interest paid.
- Tax Benefits: The after-tax cost is reduced by deductions for interest and depreciation.
A loan with a slightly higher rate but lower fees might be cheaper overall. For detailed examples, see