Debt gets paid back first, which is why lenders prefer it. Equity is ownership that only gets profits after debt is satisfied, making it riskier. Common debt sources are mortgages and construction loans; equity comes from cash or investors.
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.
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