A debt is defined as an obligation, whether certain or contingent, to pay a sum of money either immediately or at a future date. An existing debt means a debt created or arising before the effective date of, and otherwise than in connection with, the transaction. This will include transfers of property subject to a mortgage where the mortgage is granted by way of security for the giving of a guarantee.

The amount of a debt is the principal amount payable, together with the amount of any interest that has accrued due on or before the effective date of the transaction

(Sch. 4, para. 8(3)).

Example

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