Bound to be in extremely terrible, indebted state (8)
I believe the answer is:
tethered
'bound' is the definition.
(similar in meaning)
'extremely terrible indebted state' is the wordplay.
'extremely' says to hollow out the word (remove centre letters) (only the extremes of the word are used).
'indebted state' becomes 'the red' (to be 'in the red' is to owe money).
'terrible' with its middle removed is 'te'.
'te'+'thered'='TETHERED'
'to be in' acts as a link.
(Other definitions for tethered that I've seen before include "Confined in range by tied rope" , "limited movement" , "Tied to something with a rope" , "Fastened with rope or chain, like animal" , "Of animal, secured or hobbled" .)