Asset finance
Fund vehicles, equipment or machinery over 2 to 7 years, own it at the end with a chattel mortgage, or hand it back with a finance lease. Which one fits depends on the asset, not just the rate.
Asset finance funds a specific vehicle, piece of equipment or machinery, using the asset itself as security rather than property. Repayments are spread over the asset’s useful life (typically 2 to 7 years), so you’re not tying up cash buying it outright.
The first real decision isn’t the rate. It’s whether you want to own the asset at the end of the term or not, and that answer changes depending on what you’re actually financing.
What’s the difference between a chattel mortgage and a finance lease?
A chattel mortgage means you own the asset from day one and it sits on your balance sheet, with the lender holding a mortgage over it until you’ve paid it off. A finance lease means the lender owns the asset and you pay to use it, usually with the option to hand it back, extend, or buy it out at the end. Which one is right comes down to a single question: do you want to own this asset at the end of the term?
- 01Say you’re financing a coffee machine for a two-year lease, hand it back at the end and get a newer model, rather than owning a machine with a shrinking resale value. A lease usually suits an asset that ages out fast.
- 02Now say you’re financing a truck and trailer for a five-year contract. Repayments sit well below what the contract earns you, and owning the asset at the end (when resale liquidity for a truck and trailer is genuinely strong), is the smarter play. A chattel mortgage usually suits an asset worth holding onto.
- 03Balloon payments on either structure help cashflow during the term, but the balloon still has to be paid out at the end. Balloon refinance products exist in the market, and if the asset doesn’t qualify for one, a term loan or overdraft can often cover the payout instead.
- 04Rate isn’t always the deciding factor. Early payout penalties (or the lack of them), and credit limit increases some lenders offer after 12 months of clean repayments, can matter more than a slightly cheaper headline rate.
Can you finance an older asset?
Yes, some lenders on our panel now have no age restrictions at all. What does change is the rate: the newer the asset, the cheaper the rate tends to be, because a newer asset carries stronger resale liquidity if the lender ever needed to recover it. An older asset isn’t excluded, it’s just priced differently.
Can a startup get asset finance?
Yes, with the right supporting information. A signed works contract and clear cashflow forecasts from your accountant are usually enough to get a startup considered, even without years of trading history behind it. Lenders want to see the revenue case for the asset, not necessarily a long track record. See our startup business loans guide for the other paths startups typically use.
Terms are matched to how long the asset is expected to earn its keep, a fast-ageing piece of equipment and a long-life truck and trailer don’t belong on the same structure.
How much can you borrow, and what does the application need?
There’s no hard ceiling, facility size scales with the asset and the business case behind it. Above $250,000, expect more application requirements: full financial statements, and a clear justification of why the business needs that specific asset at that price. Below that threshold, applications typically move faster with less documentation. Our asset finance calculator lets you model repayments against the asset price and structure before you apply.
| Term | Typically 2 to 7 years, matched to the asset’s useful life |
| Security | The asset itself, not property, chattel mortgage or finance lease |
| Asset age | No hard cut-off with some lenders; newer assets usually price cheaper |
| Above $250,000 | Full financial statements and a clear justification for the purchase |
Why work with a broker instead of comparing lenders yourself?
Because the cheapest rate on the page isn’t always the right structure for your business case. Early payout penalties, credit limit increases after a clean repayment history, balloon refinance eligibility, age restrictions, there are enough intricacies in asset finance that working through them properly, before you sign, is where a broker earns their place. (More on how a business loan broker actually works.)
Two things people get wrong about asset finance
The cheapest rate isn’t always the right fit
Early payout penalties, additional limits available after 12 months of clean repayments, and how the structure matches your business case can matter more than shaving a fraction off the rate. It comes down to the asset and the deal, not just the number.
Age and startup status don’t automatically rule you out
Some lenders now finance assets with no age cut-off, and a startup with a signed works contract and clear cashflow forecasts can still qualify, you’re just priced differently, not excluded.
When is asset finance not the right call?
If what you actually need is general working capital rather than funding for a specific vehicle, piece of equipment or machinery, asset finance isn’t the right tool, a term loan or line of credit fits better. It’s also worth pausing before taking a balloon structure if you don’t have a clear plan for the payout at the end of the term; know whether a balloon refinance product will be available for that asset before you commit to one.
If either of those sounds like your situation, say so on the call. Redirecting you to the right product costs us nothing and saves you a facility that doesn’t fit.
Compare this against
Not sure asset finance is the right shape?
Need cash in hand rather than funding for one asset?
A term loan gives you a lump sum you control, not a facility tied to a specific purchase.
See Term loans →Funding stock or inventory rather than equipment?
Trade finance is built around a supplier purchase, not a piece of equipment or a vehicle.
See Trade finance →Want funding without tying it to one asset?
An unsecured loan is assessed on the business, not secured against the thing you’re buying.
See Unsecured business loans →How do you actually get asset finance?
Tell us the asset, roughly what it costs, and your ABN, and we take it to the panel without a formal application or a credit check at that stage. We’ll walk through chattel mortgage versus finance lease and whether a balloon structure suits the asset before you commit to either.
Want the numbers first? Try the asset finance calculator →
Run a transport or logistics business? See how finance bridges 30-90 day terms →
Run a trades or construction business? See how finance differs by construction type →
Run a hospitality or retail business? See how finance works in this sector →
New to working with a broker? See how a business loan broker works →
Give us the basics below and Andrew will come back with the two or three offers actually worth your time, usually within a business day.