is debt financing good or bad 
debt financing can be both good and bad if a company can use debt to stimulate growth it is a good option however the company must be sure that it can meet its obligations regarding payments to creditors a company should use the cost of capital to decide what type of financing it should choose the bottom linemost companies will need some form of debt financing additional funds allow companies to invest in the resources they need in order to grow small and new businesses especially need access to capital to buy equipment machinery supplies inventory and real estate the main concern with debt financing is that the borrower must be sure that they have sufficient cash flow to pay the principal and interest obligations tied to the loan 