Commercial finance facilities which are finance products used for the purchase of equipment by business entities, include an option for a balloon or residual. Different terms apply to the different finance products but essentially the concept is the same. The concept is that a portion of the loan amount, which in most cases is 100% of the equipment purchase price, is set aside from inclusion in calculating the repayments and is due for payment at the end of the finance term. This is represented as a percentage of the purchase price and is arrived at partially as the preference of the borrower but in negotiation with the lender. Individual lenders may place limits on the amount they allow. With Chattel Mortgage and Commercial Hire Purchase this is known as a balloon, with Leasing a residual and with Rent to Own as buyback. By including this element in the finance structure, it allows businesses to reduce the monthly repayments to meet cash flow requirements while making high priced equipment more affordable.