Chattel Mortgage with Major Tier One Bank


  • For a self-employed client with only 4 months of financials, it was necessary to reduce the loan amount so servicing would pass on YTD income without annualisation
  • Presenting a 12-month cash flow projection to support the application
  • The client’s strong net asset position including two properties and good savings
  • The asset type was a brand new car from a dealer.


A talented software developer in his late twenties was looking to buy a brand new Mercedes Benz as his one which was 10 years old was getting a little tired! The purchase price for the new car was $82K.

For his young age, he had 6 years of solid industry experience predominately as a PAYG Lead Developer or Senior Software Engineer previously with several companies.

He decided to become self-employed to earn more income by being able to take on work from several sources at a time rather than the salary of one employer.

He had a strong net asset position with two properties, over $150K in savings and a greater amount in shares.



The major challenge was that the lender had concerns that our client didn’t have enough experience ‘running a business’, and that being technically good at software development was viewed separately.

Our client demonstrated his technical skills having worked on several impressive projects. However, when we discussed this scenario at a high level, the feedback from a major / tier one lender was that the software development industry talent pool was saturated and he had only started his business five months ago.

Due to this the client only had four months of trading income available from management accounts and BAS. Generally even for car loans an ABN registration for at least six months would be required.



To overcome this challenge, this is what we did.

  • We assessed the four months of income available by deriving the EBIDTA and found there was substantial surplus even without annualising this income. Given the weaker impression the lender had of the client’s business experience and industry we discussed with the client and he was happy to finance just enough for the loan to service based on four months of income alone
  • From this we back solved that the client would need to put in a 30% deposit ($25K out of $82K purchase price) however it meant his financial position presented very strongly, especially in conjunction with his net assets. To make the application even stronger we also supplied a 12-month cash flow forecast
  • An application was put in with ANZ for a Chattel Mortgage, with $25K deposit, submitting the management accounts, BAS statements, a 12-month cashflow statement, and evidence of assets & liabilities.

As a result the loan was approved with a tier one major bank at a very competitive rate (3.88% pa) and over a 5 year term. Repayments are $802 per month over 5 years with a $18K balloon payment.