Which of the following best describes the purpose of a chattel mortgage?

The purpose of a chattel mortgage primarily revolves around securing financing for moveable property. Unlike real property, which refers to land and permanently attached structures, chattels are tangible, movable items, such as machinery, vehicles, or furniture. A chattel mortgage allows the borrower to obtain funds to purchase these items while giving the lender a security interest in the property until the loan is repaid.

This type of mortgage enables businesses and individuals to finance assets that are crucial for their operations or personal use, it offers the flexibility to use the items immediately while making payments over time. The lender retains the right to repossess the chattel in case of default, thereby protecting their investment.

In contrast, securing real property pertains to fixed assets such as land and buildings, and that falls under different types of financing instruments, such as a standard mortgage. Long-term financing doesn’t specifically relate to moveable assets, and while a chattel mortgage could indeed facilitate commercial transactions, it is not the defining feature of its purpose. Hence, the correct understanding is focused on the financing of movable property.