# novation

> English word · Noun · IPA /noʊˈveɪʃən/ · frequency rank #95,197

## Definitions
1. Replacement of a contract with one or more new contracts, in particular in financial markets the replacement of a contract between a particular buyer and seller with contracts between the clearing house and each party.
2. A new contract between the original contracting parties whereby the first obligation is extinguished and a new obligation is substituted.

## Etymology
Borrowed from Latin novātiō (“a renewing, rennovation”), from novō, from novus (“new”). Compare novel, novelty.

## Source
Compiled from Wiktionary via kaikki.org (CC BY-SA). Data vintage: 2026-05-06.
Canonical page: https://plainspell.com/en/word/novation