Always in debt, but respected (7)
I believe the answer is:
revered
'respected' is the definition.
(revering is a kind of respecting)
'always in debt' is the wordplay.
'always' becomes 'ever' (synonyms).
'in' indicates putting letters inside.
'debt' becomes 'red' ('in the red' means 'in debt').
'ever' put within 'red' is 'REVERED'.
'but' is the link.
(Other definitions for revered that I've seen before include "Idolised" , "Venerated" , "worshipped" , "Highly respected" , "Held in awe" .)