What is the meaning of “executory contract”?

An executory contract is a type of contract between two parties in which a promise has been made and the parties have yet to fulfill the terms of the agreement. In North Carolina, this type of contract is applicable in creditors’ rights law when a debtor is unable to pay the full amount of their debt, and the creditor agrees to accept partial repayment. The contract dictates that the debtor makes regular payments until the entire debt is paid back. During this process, the obligations of both parties must be met. The debtor must make regular payments in order to satisfy their debt obligation as outlined in the contract. On the other hand, the creditor must accept payments according to the terms of the contract and not demand the full payment in order to avoid risk of breach of contract. Executory contracts are an important part of creditors’ rights law in North Carolina because they allow creditors to be paid back without the debt being canceled, and the debtor to rebuild their credit while still satisfying their obligations under the contract. It is important that both parties understand the structure and terms of the contract in order to successfully resolve the debt in question.

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What is the meaning of “executory contract”?

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