There is article on novation and the difference between novation and assignment at Net Lawman (I can't post the link because I am new). Novation changes the parties to a contract, and doesn't change the contract itself. The consideration doesn't have to be less than the original debt, it could be any deal. There are lots of circumstances in which a debt might be novated, and the one you mention is just one. A more common one is where a company is sold, and the debt obligations are transferred to the buyer (for example, stock on loan). Novation requires the consent of all parties involved, a letter like the one you refer to is usually just an assignment of the debt, which isn't always possible in all circumstances.