This Chattel Mortgage is a form of mortgage security where an item of moveable property is used as security for a loan. The assets subject to the security are specific chattels identified in Schedule 1 to the agreement.
This Chattel Mortgage takes a charge over the chattels by way of :
- legal mortgage;
- fixed charge; and
- an assignment of the benefit of any contracts (particularly insurance arrangements) as they relate to the chattels.
This document has been created as a deed and evidences the intention of the parties to transfer title to the chattels until the debt has been repaid. Beyond this legal mortgages that are created by companies over their chattels do not usually require extra formalities to make them effective. However depending on the nature of the secured chattels, it may be necessary to perfect title to the security by registering with Companies House or on certain asset registers.
As with our other security documents, this chattel mortgage has been drafted in as basic a form as possible. As security is a complex area of the law and there are many different considerations, it is recommended to seek independent legal advice whenever you are considering taking a security charge.
This template has been created for use by companies with moveable property; it is NOT suitable for individuals and personal chattels.
This document contains the following clauses:
- Grant of Security
- Obligations of the Debtor
- Inspection & Information
- Notice of Mortgage
- Applicable Law & Jurisdiction
- Schedule 1 – Description of the Chattels
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