Debt is borrowed money like mortgages that gets repaid first and safer for lenders. Equity is your cash ownership that only gets paid after all debt is settled and captures what's left over.
Are you in the deal room? Debt is safer for the lender. They get paid first. Equity is riskier for the owner. If the deal goes bad, equity can get wiped out first. In one sentence, debt is borrowed money that must be repaid. Equity is ownership money that gets the profits after the debt is paid. Real deal version: in most real estate deals, debt equals mortgage, hard money, private loan, construction loan, Equity equals your cash, partner cash, investor cash. If you want, I can explain this next using your actual deal numbers so it clicks fast.
