Chattel Mortgage

A chattel mortgage is a type of loan used to buy movable property, like vehicles or equipment. In this arrangement, the borrower retains ownership of the asset but gives the lender a security interest—meaning if they fail to repay the loan, the lender can take possession of the item. The borrower can use the asset while repaying the loan, making it a flexible financing option. This setup helps both parties: the borrower gets necessary funds, and the lender has assurance through the security interest that the loan will be repaid.