To use the chattel mortgage calculator, you’ll need to enter some details about your loan. These are explained below:
Once you have filled in your chattel mortgage loan details, simply click ‘See My Repayments’ to view an estimated repayment amount. You can then select Monthly, Fortnightly, or Weekly repayments to see what your repayment amount will be at various frequencies.
The chattel mortgage calculator uses what is called an amortisation calculation. This provides a more accurate representation of repayments based on the annual interest rate applied to your loan, dependent on the loan term.
A chattel mortgage is established for a fixed rate over a fixed term. However, your repayments will need to cover both the interest on your loan, and the principal amount. When you first begin repaying your chattel mortgage, a greater portion of the repayments will go toward repaying the interest amount. Over time, this will reduce as the amount put toward repaying your principal amount increases.
When expressed a mathematical formula, this calculation can seem somewhat complex. However, once you understand how interest is calculated on a loan amount over time, you should even be able to perform the calculations yourself.
The simple formula for calculating Loan Repayments is: Loan Amount / Discount Factor
However, the calculations become a little more complex when finding the discount factor, which is calculated by dividing the interest rate of your loan by the number of payments per year (12 for monthly, 26 for fortnightly, or 52 for weekly) to first obtain the Periodic Interest Rate.
The formula is expressed as: (((1 + i) ^n) - 1) / (i (1 + i)^n)
|Chattel mortgage amount||5% interest||7.5% interest||10% interest|
In the example below, we’ll use a $30,000 loan at a 6% interest rate, repaid monthly over 5 years without a balloon applied:
If you want to quickly calculate your repayments without creating your own spreadsheet with the above calculations, you can use our free chattel mortgage calculator.
Calculated your Chattel Mortgage and need to look at other estimated repayments or interest calculations? We have a range of financial calculators for almost any situation. You can use these to calculate your pay, estimate equipment finance repayments, calculate capital gains tax (CGT), and much more.
You can qualify for a chattel mortgage if you want to finance a vehicle which will be used for business purposes at least 51% of the time.
Yes, but you should make sure there are no early termination or repayment fees before you agree to a chattel mortgage. A chattel mortgage is not dictated by the National Consumer Credit Protection (NCCP) Act, so lenders aren’t required to advertise all information as they would with a consumer loan.
A balloon payment is a percentage of your chattel mortgage loan amount which is not factored into your monthly repayments. Instead, the balloon amount acts as a residual payment, which you will be required to either pay in full at the end of your loan term, or refinance into another loan.
A business using a chattel mortgage to acquire company vehicles can claim back the GST on the initial purchase price if it is registered for GST on a cash basis — i.e. the business records all business income and expenses as they happen. You can claim back the GST amount on your next Business Activity Statement (BAS).