1. replacing an old obligation or contract with a new one, typically involving the substitution of a new debtor or creditor
Usage: legal/commercial term; present participle of 'novate'

Examples

• The bank is novating the original loan agreement with updated terms.
• By novating the contract, the parties agreed to release the original debtor from liability.
• The company considered novating its supplier agreement to include a new vendor.
• Novating the debt allowed the creditor to transfer the obligation to a third party.
• The legal team drafted documents for novating the commercial lease.