Medical Equipment Loans

Items acquired for use in an enterprise in the medicine field would be generally considered as physical assets and eligible for commercial financing. These may include vast selection of machines, devices, and apparatus as well as the furniture required for patient treatment, reception areas, staff workstations and waiting areas.

A balloon applies to CHP and Chattel Mortgage and a similar option – a residual, applies to a Lease. This is a set portion of the amount requested, which is set aside from the repayments and due for full payment after the last repayment is made. Balloons and residuals are usually represented as a percentage.

Interest rates vary for the different commercial credit products and for different applicant credit profiles. Different rates can apply for new and second-hand goods. The rates advertised by lenders will usually be their lowest current rate on new goods for enterprises with a good credit rating.

When applying for funding, doctors and other practitioners can decide which credit product will best suit their practice set-up, the acquisition and their objectives. The products are Chattel Mortgage, CHP, Rent to Own and Lease. Where a lender does not accept the goods as suitable for these types of asset acquisition funding, doctors may consider a secured or unsecured commercial credit option.

Yes. The IT, computer and technical hardware and systems required by surgeries and practices may be acquired using commercial funding. The most suitable credit product may depend on the specifics of the tech – hardware or software, and lender guidelines.

All commercial lending products have tax deductible elements. But these vary with the product. Interest charges are fully deductible. Monthly payments on Lease and Rent to Own are considered an operating expense by the ATO and are deductible. The value of depreciating the asset is a deduction with CHP and Chattel Mortgage.

The treatment of GST varies with the types of asset acquisition credit products. GST is not applied to interest charges for any products. GST is applied to monthly lease payments and can be claimed on the relevant BAS. With Chattel Mortgage, buyers can claim the full amount of GST applicable to the purchase, not the loan, at the time of purchase. No GST is then applied or claimed on repayments or balloon.

Asset acquisition funding products – Chattel Mortgage, Lease, CHP and Rent-to-Own typically attract a fixed interest rate. The rate is fixed for the entire term of the lending and does not change with RBA rate decisions.

The term approved on a commercial lending application can be subject to lender approval and/or based on the preference or request of the applicant. Lenders may take into account the credit profile of the applicant, the age and condition of the goods and the total amount requested. Terms of up to 7 years are achievable on commercial asset funding.

The collateral or security required for approval of commercial funding will depend on the application details. For many applications for Chattel Mortgage, Rent to Own, CHP and Lease, the goods being purchased are approved as the security. In some instances, lenders may request additional collateral be provided. This can be offered as property, personal guarantee or other assets.