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4 September, 04:16

How do debt financing and equity financing affect the balance sheet differently?

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  1. 4 September, 04:41
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    Debt financing is paying off debt using another method. Like paying off a house loan by taking out another lower interest loan. Equity financing is taking a loan out of your equity. Such as drawing cash from a house that has equity. Equity financing injects cash into a balance sheet at the expense of future expenses (paying off the equity loan) while debt financing just changes the monthly payments to pay off a given debt.
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