*Australian example prepared by Auscorp Finance for electricians, carpenters, plumbers and other trades (including apprentices transitioning to subcontractor status).
At a glance:
- Client: Electrical sole trader (ABN), Western Sydney, 6 years trading
- Objective: Replace ute, add trailer and consolidate multiple tool purchases into one simple repayment
- Assets: 2019 dual‑cab ute, enclosed box trailer, racking & signage, test gear, power tools & consumables
- Total funded: $67,500 incl. GST
- Facility: Chattel Mortgage (asset finance) covering multiple suppliers on one contract
- Security: Charge over financed assets; director/owner guarantee
- Settlement: 48 hours from full docs; vendor payments split across ute dealer, trailer supplier and tool merchant
The situation:
Like many tradies, the client had accumulated tools on separate store cards and a small personal loan. The ute was ageing and fuel‑inefficient, and weekend jobs were spilling into weekdays because gear was spread across multiple cases with no secure trailer storage.
The goal was to bundle everything into a single, tax‑efficient asset finance facility: a later‑model ute, an enclosed trailer with shelving, and a complete upgrade of power tools and test equipment. Cash needed to be preserved for wages and materials, not sunk into upfront purchases.
Our assessment & credit rationale
- Confirmed stable weekly deposits from maintenance contracts and a new builder client.
- Mapped the multi‑supplier invoice flow and structured a single facility with staged settlement so each vendor was paid on delivery.
- Set a 20% balloon to align repayments with expected resale value of the ute and trailer at term end and helped manage cashflow.
- Required comprehensive insurance noting the lender’s interest.
The finance we implemented
- Facility: Chattel Mortgage (multi‑asset)
- Amount: $67,500
- Term: 60 months
- Balloon: 20% ($13,500)
- Suppliers paid:
- Ute dealer ($43,000)
- Trailer supplier ($5,500)
- Tool merchant(s) & test gear ($14,300)
- Fit‑out/racking/signage & contingencies ($4,700)
- Settlement: Staged; final draw once racking was installed and serials verified
- Tax treatment: Client owns asset from day one; may be able to claim GST on the purchase and depreciate assets per ATO rules (seek independent advice)
Alternative structures considered
Essential Benefits of UTE in Asset Finance
- No‑balloon variant for faster principal reduction
- Seasonal step‑down repayments during winter for carpentry & landscaping clients
- Split facility when some tools were already owned (refinanced via sale‑and‑hire‑back with vendor evidence)
Documents we requested (typical)
- Driver’s licence(s) & secondary ID
- ABN/ACN details and business structure
- Quotes/invoices from ute dealer, trailer supplier and tool merchants
- Insurance certificate noting lender’s interest
Outcomes for the tradie
- One repayment instead of multiple cards/loans
- Reduced setup/pack‑down time with secure trailer racking
- Improved job capacity and fuel efficiency with a later‑model ute
- Predictable weekly cash flow; freed up working capital for materials
- Clear end‑of‑term options: refinance residual, trade in, or payout
Why this works for tradies
- Consolidates vehicle + trailer + tools into a single, tax‑effective structure
- Preserves cash for materials and wages
- Direct supplier payments keep deliveries on schedule
- Balloon/residual keeps repayments workable while matching asset life
Risks & mitigants
- Over‑gearing → Size the facility from average weekly deposits, not best weeks
- Asset mismatch → Align balloon to vehicle residual; tools amortised inside term
- Insurance gaps → Comprehensive cover and list accessories/racking
- Seasonality → Option for step‑down repayments or small buffer in the amount financed
*Compliance & important information*
- This case study is an illustrative example only, not financial or tax advice, and not a credit offer.
- Credit is subject to lender approvals, verification and applicant profile.
- Tax outcomes depend on your circumstances. Please seek independent tax/accounting advice.
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