- Official section
- National V.B: Contract Types
- Broker weight
- Part of 19% of the national portion
- Expected scored items
- The current PSI broker outline assigns about 19 of 100 scored national items to Contracts
Contracts exam concept
Executed vs. executory contracts
A signature tells you that a document was signed. It does not tell you that the deal was performed. A signed purchase agreement waiting for closing is executory because payment and conveyance remain ahead. Once the promised exchange is completed, the contract is executed in the exam's performance sense. Keep those two uses of executed separate and most questions become straightforward.
Last updated: August 1, 2026
What is the difference at a glance?
Short answer: Executed means the required performance is complete. Executory means material performance remains due by one or both parties. A contract can be valid, signed, bilateral, and still executory. A sale contract typically moves from executory after acceptance to executed through completed closing, while a lease or installment contract can remain executory for years. Solve the question by listing every material duty, marking each performed, excused, discharged, or outstanding, and checking whether any obligation survives the stated event.
Executed has two legitimate uses. It can describe a document that has been signed, and it can describe a contract whose performance is complete. PSI-style contract classification usually contrasts executed with executory and therefore asks about performance. Statutes use executory in specialized settings such as bankruptcy and receivership, where the governing definition and remedies can differ from an entry-level exam shorthand. This guide reflects primary sources reviewed through August 1, 2026.
What changes from one term to the next?
- Terms
- Executed vs. executory
- Difference
- Executed means the material performance being classified is complete. Executory means material performance remains due.
- Question cue
- Finished exchange versus future obligation.
- Terms
- Executed document vs. executed contract
- Difference
- An executed document can mean a signed instrument. An executed contract in the exam's performance classification means the parties completed their duties.
- Question cue
- Signed paper versus completed performance.
- Terms
- Executory vs. unenforceable
- Difference
- Executory describes unfinished performance. Unenforceable describes a legal defense that blocks a judicial remedy.
- Question cue
- Work remains versus court remedy blocked.
- Terms
- Executory vs. voidable
- Difference
- Executory concerns performance stage. Voidable concerns a protected party's power to avoid an agreement because of a qualifying defect.
- Question cue
- Timeline status versus avoidance power.
- Terms
- Executed vs. valid
- Difference
- Executed addresses performance. Valid addresses legal sufficiency. A valid contract can be executory, and completed conduct can still be challenged for fraud or illegality.
- Question cue
- Did parties perform versus did law recognize the bargain.
- Terms
- Partial performance vs. full performance
- Difference
- Partial performance satisfies some duties. Full performance satisfies all material duties within the classification being asked.
- Question cue
- Some boxes checked versus no material box left.
- Terms
- Contract to sell vs. completed sale
- Difference
- A contract to sell promises a future transfer and can create equitable consequences. A completed sale includes the actual transfer of legal title.
- Question cue
- Promise to convey versus conveyance accomplished.
- Terms
- Closing vs. recordation
- Difference
- Closing completes the parties' settlement exchange when required acts occur. Recordation gives public notice and protects priority; it is not always the event that makes the deed effective between grantor and grantee.
- Question cue
- Transaction performance versus public record notice.
- Terms
- Breach vs. execution
- Difference
- Breach is failure to perform a duty. Execution in the performance sense is completion of the duty.
- Question cue
- Promise broken versus promise completed.
- Terms
- Termination vs. full performance
- Difference
- Termination ends specified future obligations under contract or law. Full performance ends them because the promised work was completed.
- Question cue
- Duties ended versus duties fulfilled.
How does the distinction change the answer?
Signed purchase agreement before closing
Scenario: A seller accepts the buyer's written offer. Earnest money has been delivered, but inspection, financing, title review, final payment, and deed delivery remain ahead.
- A binding contract may have formed and the document is signed.
- Both buyer and seller still owe material performance.
- The signature does not complete the purchase transaction.
Answer: The purchase contract is executory in the performance sense.
Completed purchase closing
Scenario: The buyer delivers the required funds, the seller delivers the deed, the settlement documents are completed, and possession is transferred as the contract requires. No material sale duty survives.
- The price and conveyance exchange occurred.
- The required possession and closing documents were delivered.
- The facts identify no material outstanding obligation.
Answer: The purchase contract is executed under the exam's completed-performance classification.
Seller has delivered but buyer has not paid
Scenario: A seller delivers the required instrument into a valid closing escrow, but the buyer fails to deposit the remaining purchase money by the deadline.
- The seller may have completed the stated delivery duty.
- The buyer's material payment duty remains unmet.
- The buyer's failure may be a breach, but it is not full performance.
Answer: The contract remains executory or partially executed, with a possible buyer breach.
Five-year lease in year two
Scenario: A landlord and tenant signed a five-year lease, the tenant took possession, and three years of rent, occupancy, repair, and surrender duties remain.
- The lease document was executed in the signature sense.
- The parties performed some obligations during the first two years.
- Material continuing duties remain for the balance of the term.
Answer: The lease is executory during the ongoing term.
Installment contract before final deed
Scenario: A contract buyer has made 84 of 120 scheduled payments and occupies the home. The seller retains legal title and must deliver a deed after the final qualifying payment.
- Substantial performance has occurred, but installments remain.
- The seller's final conveyance duty also remains.
- Possession and equitable rights do not equal completed legal-title transfer.
Answer: The installment contract remains executory.
Closing with a surviving repair escrow
Scenario: The deed and purchase money are exchanged, but the seller must complete roof work within 20 days and money is held in escrow to secure that promise.
- The core conveyance and payment exchange is complete.
- A material repair obligation expressly survives closing.
- The question may require a qualified answer rather than treating every duty as finished.
Answer: The sale closed, but the contract remains executory as to the surviving repair and escrow duties.
The P-E-R-F-O-R-M status test
- Pinpoint the contract and the exact time the question asks you to classify.
- Enumerate the material promises: payment, conveyance, possession, service, rent, repair, document, or continuing covenant.
- Record each promise as performed, outstanding, waived, excused, breached, or discharged.
- Find whether one party finished while the other still owes a material duty.
- Observe conditions and contingencies separately from the performance they trigger.
- Read executed in context: signature usage or completed-performance usage.
- Mark surviving duties, escrow holdbacks, warranties, and post-closing obligations.
- Make the classification and support it with the document, closing record, payment proof, deed delivery, or release.
- Status
- Executory
- Performance position
- Material duties remain for both parties
- Real estate example
- Signed purchase contract before closing
- Key evidence
- Contract and open contingency log
- Status
- Partially executed
- Performance position
- Some performance complete, some material duty remains
- Real estate example
- Buyer paid deposit, seller still owes deed
- Key evidence
- Payment proof and outstanding obligation
- Status
- Executed
- Performance position
- Material exchange complete
- Real estate example
- Price paid and deed delivered at closing
- Key evidence
- Settlement record and delivered deed
- Status
- Executed document
- Performance position
- Instrument has been signed
- Real estate example
- Purchase agreement signed by all parties
- Key evidence
- Signatures and effective delivery
Where do similar terms create traps?
- Trap
- A signed contract is always executed for classification purposes
- Correction
- A signed purchase agreement can still be executory because payment, conveyance, and other material duties remain.
- Trap
- Executory means invalid
- Correction
- A valid and enforceable contract is often executory between formation and completion.
- Trap
- Executed means enforceable
- Correction
- Performance status does not resolve fraud, illegality, capacity, limitation, or other validity and remedy issues.
- Trap
- The purchase contract transfers legal title when signed
- Correction
- A contract to sell promises future conveyance. Legal title ordinarily transfers through effective deed delivery.
- Trap
- Equitable conversion completes the sale
- Correction
- Equitable consequences can arise during an executory contract while legal title remains with the seller.
- Trap
- One party's complete performance makes the whole contract executed
- Correction
- A material duty still owed by the other party keeps the contract executory as to that performance.
- Trap
- Partial performance and full performance are interchangeable
- Correction
- A deposit, inspection, installment, or service step does not finish every material promise.
- Trap
- Breach counts as performance
- Correction
- Breach is nonperformance and can create remedies or discharge, not a fictional completion of the promise.
- Trap
- Every closing makes every obligation executed
- Correction
- Check repair escrows, possession agreements, tax adjustments, indemnities, title covenants, and express survival clauses.
- Trap
- An expired contract was fully performed
- Correction
- Expiration can end a contract without the contemplated transaction occurring. It is a different reason duties ended.
- Trap
- Recordation is required before any contract is executed
- Correction
- Recording concerns public notice and priority. Contract performance and effective deed delivery are separate questions.
- Trap
- Bankruptcy's executory-contract treatment controls every exam question
- Correction
- Use the general performance distinction unless the facts expressly invoke 11 U.S.C. 365 or another specialized statute.
Can you separate the terms in a new fact pattern?
These questions are original study items aligned to the published outline. They are not copied, recalled, or predicted PSI questions.
1. A buyer and seller have signed a valid purchase agreement, but closing will occur in 30 days. How is the contract classified by performance status?
- Executory
- Executed
- Void
- Unenforceable
Show answer and explanation
Answer: Executory
The buyer's payment and the seller's conveyance remain material future obligations.
2. Which facts most strongly support classifying a purchase contract as executed?
- The buyer paid and the seller delivered the deed as required
- The buyer submitted an offer
- The parties scheduled an inspection
- The lender ordered an appraisal
Show answer and explanation
Answer: The buyer paid and the seller delivered the deed as required
Completed payment and conveyance establish the core performed exchange rather than a preliminary step.
3. A landlord and tenant signed a three-year lease yesterday. Which statement is best?
- The document is signed, but the lease is executory because future duties remain
- The lease is fully executed because signatures end every obligation
- The lease is void until the final month
- The tenant already owns legal title
Show answer and explanation
Answer: The document is signed, but the lease is executory because future duties remain
Future rent, possession, and other covenants keep the lease executory during its term.
4. The buyer has fully paid, but the seller still owes the deed. What is the contract's performance status?
- Executory as to the outstanding conveyance
- Fully executed
- Automatically void
- Unilateral only
Show answer and explanation
Answer: Executory as to the outstanding conveyance
One party's completion does not erase the other party's material unperformed promise.
5. Which statement correctly distinguishes executed from valid?
- Executed concerns performance, while valid concerns legal sufficiency
- Executed and valid always mean the same thing
- A valid contract can never be executory
- Only an oral contract can be executed
Show answer and explanation
Answer: Executed concerns performance, while valid concerns legal sufficiency
Performance stage and legal status are independent classifications.
Where do these ideas appear on the outline?
- Topic
- Executed contract
- What to know
- Completed performance, buyer payment, seller conveyance, deed delivery, closing documents, possession, completed exchange, no material duty remaining, historical transaction, survival clause, and proof
- Best exam move
- Choose executed when the facts establish that the material promises being classified have been performed.
- Topic
- Executory contract
- What to know
- Binding agreement, future performance, pending duty, payment, conveyance, inspection, financing, title cure, closing, possession, rent, maintenance, installment, condition, and deadline
- Best exam move
- Choose executory when one or both parties still owe material performance.
- Topic
- Signed versus performed
- What to know
- Execution ceremony, signature, electronic signature, delivery, acceptance, binding date, document usage, performance usage, context, executed copy, executory status, and no synonym
- Best exam move
- Read what executed is contrasted with. Signed versus unsigned tests execution of the document; executed versus executory tests performance.
- Topic
- Purchase contract timeline
- What to know
- Offer, acceptance, effective date, earnest money, attorney review, inspection, disclosure, loan application, appraisal, title, survey, insurance, walkthrough, Closing Disclosure, closing, deed, funds, possession, and recordation
- Best exam move
- Treat the formed purchase contract as executory while the essential closing exchange remains unfinished.
- Topic
- Closing and execution
- What to know
- Settlement, signatures, tender, funds, deed delivery, title transfer, keys, possession, escrow instruction, recording, closing statement, final condition, and completion
- Best exam move
- Verify performance rather than assuming that arrival at the closing table completed every duty.
- Topic
- Surviving obligations
- What to know
- Representation, warranty, title covenant, indemnity, tax adjustment, escrow holdback, repair escrow, post-closing possession, document correction, cooperation, confidentiality, and express survival
- Best exam move
- State which part is performed when a question includes a duty that expressly survives closing.
- Topic
- Partial performance
- What to know
- Deposit paid, inspection completed, loan approved, work begun, installment made, one party complete, other party outstanding, partially executed, material remainder, proof, and no automatic completion
- Best exam move
- Partial performance does not make the whole contract executed while a material promise remains due.
- Topic
- One party fully performed
- What to know
- Seller delivered, buyer owes payment, buyer paid, seller owes deed, service completed, commission unpaid, rent unpaid, unilateral completion, outstanding reciprocal duty, breach, and remedy
- Best exam move
- A contract remains executory as to the party's outstanding material obligation even if the other side finished.
- Topic
- Installment land contract
- What to know
- Contract seller, contract buyer, installment payment, possession, legal title, equitable interest, taxes, insurance, maintenance, final payment, deed delivery, default, forfeiture, foreclosure, and consumer protections
- Best exam move
- Choose executory while future installments and final conveyance remain required.
- Topic
- Lease
- What to know
- Landlord, tenant, possession, future rent, quiet enjoyment, maintenance, repair, access, insurance, renewal, surrender, security deposit, continuing covenant, expiration, and holdover
- Best exam move
- A signed lease with future occupancy and rent duties is executory during its term.
- Topic
- Brokerage agreement
- What to know
- Client, sponsoring broker, designated agent, marketing, showing, search, negotiation, minimum services, compensation, procuring cause, expiration, protection period, closing, records, and ongoing duty
- Best exam move
- A signed brokerage agreement remains executory while brokerage services or a contingent compensation duty remains outstanding.
- Topic
- Option contract
- What to know
- Optionor, optionee, consideration, fixed period, irrevocable offer, exercise, notice, purchase contract, expiration, performance, separate option promise, and no automatic sale
- Best exam move
- Classify the option promise separately from any purchase contract created by a valid exercise.
- Topic
- Equitable conversion
- What to know
- Valid enforceable sale contract, equitable interest, seller legal title, purchase money, risk allocation, insurable interest, death, creditor, remedy, closing, deed, and no completed legal-title transfer
- Best exam move
- Equitable consequences can begin while the sale contract remains executory and legal title has not transferred.
- Topic
- Conditions and contingencies
- What to know
- Condition precedent, condition subsequent, financing, inspection, appraisal, title, sale of existing home, waiver, satisfaction, failure, excuse, prevention, deadline, and duty maturity
- Best exam move
- A satisfied condition can make performance due, but it does not itself prove that the required performance occurred.
- Topic
- Breach and discharge
- What to know
- Nonperformance, material breach, minor breach, anticipatory repudiation, notice, cure, damages, specific performance, rescission, mutual release, accord, satisfaction, impossibility, termination, and duty discharge
- Best exam move
- Do not relabel breached performance as executed; identify whether duties remain, were excused, or were discharged by another doctrine.
- Topic
- Death or incapacity before conveyance
- What to know
- Legally subsisting contract, decedent, ward, representative, petition, court order, deed, lease, warranty, estate liability, equitable right, description, compromise, and completion
- Best exam move
- A party's death does not automatically erase an executory real estate contract when law permits the representative to complete it.
- Topic
- Special statutory meaning
- What to know
- Bankruptcy, 11 U.S.C. 365, assumption, rejection, cure, assignment, unexpired lease, receivership, court approval, purchaser in possession, timeshare interest, and specialized remedy
- Best exam move
- Use the governing statute when the question expressly moves from general contract vocabulary into bankruptcy or receivership.
- Topic
- Broker documentation
- What to know
- Executed copy, true copy, 24 hours, corrected document, written consent, initials, blanks, electronic agreement, transaction file, contingency date, closing confirmation, surviving item, and referral to counsel
- Best exam move
- Deliver and preserve signed documents promptly, track remaining duties, and avoid telling a party that signature alone means the transaction is complete.
How do you make the distinction stick?
- Session
- Session 1
- Focus
- Separate signature from performance
- Proof you are ready
- Classify 20 uses of executed as signed-document usage or completed-performance usage and explain the context clue.
- Session
- Session 2
- Focus
- Build the purchase timeline
- Proof you are ready
- Place formation, contingency work, financing, title, walkthrough, funds, deed delivery, possession, and recordation in order.
- Session
- Session 3
- Focus
- Inventory remaining duties
- Proof you are ready
- For 15 contracts, list each party's material promise and mark it performed, outstanding, waived, excused, breached, or discharged.
- Session
- Session 4
- Focus
- Practice long-duration agreements
- Proof you are ready
- Resolve leases, installment contracts, options, brokerage agreements, repair escrows, and surviving-warranty scenarios.
- Session
- Session 5
- Focus
- Keep status labels separate
- Proof you are ready
- Describe 20 agreements with both a validity label and a performance label without mixing voidable, unenforceable, breached, and executory.
- Session
- Session 6
- Focus
- Run the P-E-R-F-O-R-M test
- Proof you are ready
- Score at least 90% and identify time, promises, performance, conditions, context, surviving duties, and evidence for every miss.
Do not count recognition as mastery. Close the notes and explain the rule, apply it to a new fact pattern, and identify why each distractor fails.
Turn the comparison into a test-day decision
From concept to decision
Drill this topic, then review the explanation
Pass Illinois gives you original national and Illinois questions, topic-by-topic study, clear explanations, timed practice, flashcards, progress tracking, and Math Coach. Start free, find the weak distinction, and focus the next session there.
Questions students ask about Executed vs. Executory Contracts
What is an executed contract in real estate?
For the standard real estate exam classification, an executed contract is one whose required performance has been completed. In a purchase transaction, that usually means the buyer paid as required, the seller delivered the deed, title transferred, and the closing obligations were performed. A surviving warranty or indemnity can require a more precise answer about which duties are complete.
What is an executory contract?
An executory contract is a formed contract with material performance still due by one or both parties. A signed purchase agreement awaiting inspection, financing, closing, payment, or deed delivery is executory. So are an ongoing lease with future rent and possession duties and an installment land contract awaiting final payment and conveyance.
Is a signed purchase contract executed or executory?
It is normally executory when the exam is asking about performance status because closing duties remain. The word executed can also mean signed in document practice, so a lawyer may call it an executed purchase agreement. Read the question's contrast: executed versus unsigned concerns signing, while executed versus executory usually concerns completion of performance.
When does a real estate purchase contract become executed?
Under the exam model, it becomes executed when the parties complete the obligations that make up the transaction, ordinarily at or through closing. Do not rely on the calendar label alone. Confirm payment, deed delivery, possession if due, document delivery, and any condition that the question identifies as essential.
Is a contract executory if only one party still owes performance?
Yes. If one party has fully performed but the other still owes a material duty, the contract remains executory as to the outstanding performance. It may also be described as partially executed. The clean exam question is whether any material promised performance remains due.
Does signing a real estate purchase contract transfer legal title?
No. Illinois authority distinguishes a contract to sell from the completed sale. A valid enforceable contract can create equitable-conversion consequences, but the seller ordinarily retains legal title until the deed is delivered through the required transaction. Signing alone is not the legal-title transfer.
Is an ongoing lease executed or executory?
An ongoing lease is generally executory because future obligations remain, including possession, rent, maintenance, access, repair, insurance, or other covenants. The lease may be signed and possession may have begun, but future performance keeps it executory under the exam classification.
Does breach turn an executory contract into an executed contract?
No. Breach means promised performance was not supplied. It can create remedies, termination rights, or a discharge of remaining duties, but it does not rewrite nonperformance as completed performance. Identify what was due, what was breached, and whether later agreement or law discharged the obligation.
Can an executed contract still lead to a lawsuit?
Yes. Completion of performance does not prove the agreement was validly induced or that every representation was true. Claims can concern fraud, defective performance, title covenants, warranties, indemnities, recording, or obligations that expressly survive closing. Executed describes performance status, not freedom from every claim.
Are these official PSI exam questions?
No. They are original questions aligned to the national Contracts outline effective June 24, 2026. The current PSI bulletin, Illinois statutes, administrative rules, and official Illinois court opinions were reviewed through August 1, 2026.
Primary sources
- PSI Illinois Candidate Information Booklet dated June 24, 2026
- Carollo v. Irwin, 2011 IL App (1st) 102765, executory contract to sell versus completed sale
- In re Estate of Pawlinski, 2014 IL App (1st) 131973, executory purchase contract and equitable conversion
- 755 ILCS 5/20-17, completion of a decedent's or ward's contract to convey or lease real estate
- 765 ILCS 10, current Illinois Seals and Real Estate Contracts Act
- 740 ILCS 80/2, current Illinois Statute of Frauds for interests in land
- 68 Illinois Administrative Code 1450.775, written real estate agreements current through August 1, 2026
- 765 ILCS 1090/17, current Illinois receivership rules for executory contracts
- 11 U.S.C. 365, current federal treatment of executory contracts and unexpired leases
The current official outline controls the tested scope. Statutes, regulations, and official agency materials control when a general study rule and a jurisdiction-specific rule differ.
Editorial status
Checked against primary sources
The Pass Illinois editorial team last checked this guide on August 1, 2026. Every practice question is an original study item, and the source links above let you verify the rules that support the lesson.