What is an executory contract?

An executory contract refers to a contract that has been signed by the parties involved but has not yet been fully executed or performed. In this context, the term "executory" suggests that there are still obligations or actions that need to be completed by one or both parties as outlined in the agreement.

This concept is significant in real estate transactions, as many contracts, like purchase agreements, are considered executory until the terms of the contract, such as the transfer of property title and payment, have been fulfilled.

The other possibilities describe different concepts. A fully performed contract is one where all parties have completed their obligations, while a contract contingent on future performance implies that certain conditions must be met for the contract to become enforceable. Verbal agreements, while sometimes valid, do not typically fall under the definition of executory contracts in a legal sense, especially in real estate, where agreements usually need to be in writing to be enforceable.